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Types of Companies in Brazil

Types of Companies in Brazil

You can register various company types in Brazil like limited liability companies, anonymous companies, partnerships, and branches. Despite differences in company legislation compared to Europe or the USA, entrepreneurs can easily incorporate their chosen business structure. Our specialists in company formation in Brazil can provide complete assistance and information regarding the document preparation and other requirements.

 Quick Facts  
Main types of companies/structures

– limited liability company (LTDA),

– limited liability corporation (SA),

– EIRELI

Foreign entities in Brazil

– branches,

– subsidiaries,

– representative offices

Minimum share capital

None, except for EIRELI (at least 100 times the current minimum wage)

Legal framework

– Brazilian Civil Code,

– National Trade Registry Department

General steps in company formation in Brazil

– select business structure,

– appoint representative agent,

– draft documents,

– obtain tax identification number,

– register with local municipality

General required documents

– Articles of Association,

– incorporation certificate,

– power of attorney (if applicable),

– ID documents,

– legal entity brochure,

– taxpayer certificate, etc.

Special licenses and permits

Industry-specific (healthcare, transportation, finance, construction etc.)

Corporate income tax rate

15%;

A surcharge of 10% applies to companies with annual taxable income over 240,000 BRL

Incorporation time

8 weeks (approx.)

Indirect taxes (VAT) registration

VAT is implemented through various indirect taxes and registration is mandatory for all businesses.

Company secretary required (YES/NO)

NO

Minimum shareholders required

– 2 for LTDA and SA,

– 1 for EIRELI

Virtual office possibility (YES/NO)

YES

Residency requirement

Foreigners are not allowed to open an EIRELI, but can open the other company types in Brazil.

Assistance

We assist in selecting the company type for your business needs and assist throughout the entire process of company incorporation in Brazil.

Main company types in Brazil

There are several available legal entities for international investors who want to open a company in Brazil. The entire incorporation process can be conducted remotely, with the help of our team.  The main types of companies in Brazil are as follows:

  • Limited Liability Company;
  • Limited Liability Corporation (anonymous company);
  • Branch Office;
  • EIRELI (Empresa Individual de Responsabilidade Limitada – Individual Limited Liability Company/ sole proprietorship).

There is also the possibility of opening a subsidiary, or representative office in the country, if this meets your business needs. You can also form a consortium (consórcio), although this doesn’t constitute a corporate entity. The consortium refers to a collaborative arrangement or partnership between multiple companies, who jointly undertake projects or provide services.

We can help you with Brazil company formation for any type of company mentioned above. We also invite you to watch a video about the business forms:

Limited liability company in Brazil

In accordance with the Civil Code in Brazil, one can establish a limited liability company, one of the most suitable forms of business in the country, which offers limited liability to the partners whether local or foreign. In tax matters, an LLC in Brazil respects the same provisions and requirements as for a corporation. A limited liability company in Brazil can be set up by at least two stockholders or companies and there is no need for a minimum share capital. We mention that the members of an LLC in Brazil must appoint a board of managers who will be in charge of several operations in the company with a prior written authorization from the company’s representatives.

Anonymous company in Brazil

An anonymous company in Brazil is the same as a business corporation, where at least two shareholders are necessary to form such entity. This business form can be closed or public and must comply with the provisions of the Corporate Law in Brazil. When incorporating an anonymous company in Brazil, there is no need for a minimum share capital, and the business may register both assets and finances. As the main condition when registering an anonymous company in Brazil from abroad, one should consider hiring a national officer or manager in the firm. In matters of drafting the documents for such entity and the needed licenses and permits, you may address your requests to our company incorporation agents in Brazil.

Branch in Brazil

The Ministry of Development, Industry, and Trade in Brazil issues the authorizations for branches of foreign companies in the country. When registering a branch in Brazil, the parent company must provide a specific capital and please consider that such entity is subject to the taxation system in the country. One should know that the withholding tax is not imposed on the transfer of profits to the parent company.

Foreign companies willing to open a branch in Brazil can request the services offered by our team of incorporation agents. We can provide detailed information about the local requirements and special approvals for the branch, depending on the industry in which it will activate. We advise foreign investors to reach out to us as soon as they decide to open a branch.

Independent contractors in Brazil (EIRELI)

EIRELI is a suitable choice for independent entrepreneurs seeking limited liability protection. Such business form is registered by a single individual who owns 100% of the paid-in capital which must represent 100 times the minimum wage in Brazil. This kind of entity offers complete control to the owner, for obligations and also debts.

Similar to a traditional limited liability company (LLC), the owner’s personal assets are protected from the company’s debts and liabilities. In the case of business-related obligations, creditors can only access the assets of the company, not the owner’s personal assets. To establish an EIRELI, there is a minimum capital requirement, which varies on the local minimum wage. We can assist in Brazil company formation for sole proprietors.

Subsidiaries in Brazil

Investors have the opportunity to open a branch in Brazil or subsidiary, depending on their needs and business goals. To establish a subsidiary in Brazil, several steps are typically required:

  • File articles of organization;
  • Register with the Board of Trade;
  • Obtain a Tax ID;
  • Establish a visa;
  • Open a bank account;
  • File a business license to operate within a specific municipality;
  • Register with Brazil’s “Inscrição Estadual” for tax purposes;
  • Apply for authorization to use “Notas Fiscais,” which is essential for filing tax documents and other paperwork;

You also need, within the first 30 days of operations, to register with Brazil’s Social Security Institution and obtain a CNPJ (company ID number), even if the company doesn’t have employees.

Most of the time, the type of company in Brazil used for subsidiaries is the limited liability company. Therefore, to comply with local laws, a subsidiary with this legal entity requires at least two shareholders at all times. Additionally, at least one Brazilian resident must manage the local business at all times, and this person should be appointed in the Articles of Association.

Even though it might seem complex, our team handles the procedure of company incorporation in Brazil remotely and hassle-free.

Statistics about companies in Brazil

If you wish to know more about the types of companies in Brazil and the country’s business environment, we have gathered some interesting statistics related to this subject:

  • In 2021, Brazil had approximately 1.89 million legally registered retail and trade companies. This is the largest industry for companies in Brazil, about 33% of all legally registered companies in the country;
  • During the same year, there were slightly over 106,000 companies registered in the agricultural sector;
  • Brazil is a great country for start-ups, regarded as the leading start-up hub in Latin America. Over the past decade, Brazil has generated more than 13,000 startup companies and is home to 8 unicorn companies (as of 2024).

For investors who want to open a company in Brazil, understanding the differences between the different types of companies is an essential step. Our team offers counseling for entrepreneurs looking o make this choice and is able to provide you with a detailed comparison, depending on the size of the business you are looking to incorporate, as well as the number of employees and the business field.

For a better understanding of the requirements when setting up a company in Brazil, we suggest you get in touch with our team of company incorporation agents in Brazil.