Foreign Capital in Brazil


Foreign capital may enter freely into Brazil and is not subject to prior approval by the government. There are no conditions regarding the total amount of investment that can be made in Brazil.

A small number of exceptions exist in accordance with the Brazilian Constitution and federal laws, prohibiting or limiting FDI in specific sectors:



  • Foreign capital may be subject to limitations, or prior authorization from public authorities may be required;
  • Acquisition or rental of rural property (permissions may be requested from INCRA or the National Congress);
  • Financial institutions (permission may be requested from Cade and the BCB)
  • Media, including television networks, magazines, newspapers and radio broadcasting stations (the government prevents foreign investment in the ownership and administration of media – the Brazilian Constitution of 1988 stipulates that at least 70% of the total capital of media companies must be owned directly or indirectly by Brazilians born in Brazil or Brazilians naturalized for a period of at least ten years);
  • Mining sector;
  • Health assistance;

It is worth noticing that restrictions to foreign capital on air transportation companies were wiped out by Law n. 13.842 of 201


  • Taxation in Brazil occurs at three levels of government: federal, state, and municipal. In broad terms, the main federal taxes cover excise duties, import and export duties, financial transactions, taxes on revenue, profits and income, as well as contribution charges that fund social security and employment benefits, managed by the Federal Revenue Service (“Receita Federal").
  • Aware of its complexity, the government is committed to simplifying the Brazilian tax system. The Federal Government reforms package includes proposals to standardize some taxes, namely ICMS – which is currently defined individually by the States and often differs from one to another – and PIS and Cofins, currently divided into two categories (the non-cumulative regime, with a rate of 9.25% that allows deducting credits on the acquisition of inputs; and the cumulative one, with a rate of 3.65% without deducting credits).
  • The Brazilian government, through its Department of Registration of Business and Integration and other federal agencies, is responsible for authorizing the nationalization or installation of offices, agencies, branches or facilities of a foreign company in Brazil. The incorporation of a Brazilian subsidiary is not subject to a similar authorization process. All these legal entities must calculate and pay taxes regularly (monthly, quarterly, or annual, depending on the tax due) and file a yearly tax return consolidating the results from the previous calendar year. Regardless of capital control, the law acknowledges as a domestic company any foreign corporation that has a subsidiary, branch, agency, office, representative, or the like in Brazil. Therefore, all companies should obtain a Corporate Taxpayer Identification Number (CNPJ) to collect taxes in the Brazilian system.

Property and land

  • Foreigners can acquire real estate in Brazil, even without the involvement of local partners. However, there are rules that must be observed when it comes to specific areas, such as maritime territory, islands, rural land, and areas near Brazil’s international borders, regarded by the government as crucial for security.
  • Brazilians and foreigners have similar rights and obligations when it comes to buying or leasing property. Properties can be registered only once, and that must happen at a register of deeds (Cartório de Registros Imobiliários) located in the same jurisdiction of the property. The resulting document shall contain all information about the property, such as its transaction history and physical identification. It is important to note that these records are always public. Registry costs vary from one state to another.

Rural Land Acquisition/Leasing

  • Regarded as prized assets by many, rural properties in Brazil can be purchased or leased by foreigners, with certain legal limitations, especially concerning the size of the property. For purposes of rural land acquisition or leasing, foreigners in Brazil are foreign individuals who are not naturalized, even if they are married to a Brazilian citizen with a community property system and have Brazilian children.

Environmental Policy, Regulation, and Licenses

  • It is important to keep in mind that Brazil is a global leader for environmental issues, with a long history of environmental protection. Its first Forest Code was implemented in 1934. In 2012, the Code was updated to suit the more recent Brazilian reality better.
  • The Ministry of the Environment (MMA) is the main department concerning environmental policy in Brazil. It is responsible for formulating policies on climate change and environmental quality, biodiversity and forests, water resources, and sustainable urban and rural development..
  • A core directive of Brazil’s environmental policy is the strict liability for factories, which are held accountable for the pollution they cause. Subsequent legislation has authorized public prosecutors and NGOs to act in defense of the environment, and a number of regulations have been issued regarding conservation and environmental licensing, as well as oil and gas exploration and production.



  • Before making any travel arrangements, investors should check whether they will be required a visa. Currently, Brazil has agreements with nearly 90 countries for visa exemptions, supported by the principle of reciprocity adopted by the Brazilian government. This reciprocity means that if a certain country does not require visas for Brazilians, citizens of that country will not be required visas to enter Brazil.
  • For citizens in countries that are not exempt from visas, it is advised to apply for a business/tourism (visit) visa at the Brazilian consulate in their country of origin. These visas allow for a maximum stay of 90 days, which can be extended for an additional 90 days under request at the Federal Police. They are valid for up to 5 years, depending on the country.


  • In 2017, a new Immigration Law was approved, altering some requirements for requesting permanent visas. Adopting a more humanitarian perspective, Brazil will now issue residence visas to stateless individuals whose life may be at risk, foreigners whose countries are affected by war, conflicts or natural disasters, people submitted to slave labor conditions and victims of human trafficking.
  • Some traditional residence visas are still being granted, such as the family reunion visas. Anyone who marries or has a civil union with a Brazilian or an immigrant who has a temporary residence visa is entitled to obtain a permanent residence visa. These are valid for both heterosexual and same-sex couples. Foreigners who have Brazilian parents, grandparents, siblings, children or are legally responsible for a Brazilian individual may also obtain permanent residence.


  • Non-Brazilians who intend to invest in activities with economic, social, scientific, technological or cultural value, generating jobs and wealth in the country, may also apply for a residence visa, as well as those who have received job offers in Brazil, according to new legislation.
  • Nowadays, investors who invest the equivalent of BRL 500,000 in foreign currency in Brazil and present plans to create new jobs may receive a permanent visa. For those who intend to invest in technology and R&D activities, the starting value is BRL 150,000.

Establishing a business - Main types of companies in Brazil

Main types of companies

("Empresa Individual de Responsabilidade Limitada")

a.1 Applicable Legislation
a.2 Classification
  • Individual company;
  • For profit.
a.3 Legal name
  • Firm Name (“Firma”): Proprietor’s full name, followed by “Eireli”;
  • Corporate Name (“Denominação”): Corporate purpose, followed by “Eireli”.
a.4 Owners
  • Only one proprietor; a one-person undertaking (meaning that once the individual opts for an Eireli, he/she can run only one company of that type);
  • Individual (of Brazilian or foreign origin).
a.5 Articles of Organization/Incorporation
  • Articles of Organization;
  • Registration and filing at the Commerce Registry (“Junta Comercial”) of competent jurisdiction.
a.6 Capital
  • Given that the company relies on a sole proprietor, capital is not required to be divided into units of ownership;
  • The minimum capital required may not be less than one hundred times the sum of the highest minimum salary applied in Brazil on the date of filing for registration;
  • Once it is immediately paid in, capital may be increased at any time;
  • Capital may be reduced, as long as the minimum value required by law is maintained.
a.7 Payment
  • A statement, in the articles of organization, that capital has been fully paid in;
  • Any assets can be used for payment, provided they are susceptible to cash valuation.
a.8 Ownership/Partnership Liability
  • Limited to paid-in capital;
  • Unlimited: in case capital is as of yet unpaid, not observing the minimum capital requirement.
a.9 Control and Management
  • Controlled by the sole proprietor;
  • An Eireli may be managed by one or more people, being the owner or a non-owner, as indicated in the articles of organization. The legal entity cannot be a manager;
  • A foreign individual may be appointed as manager, provided that he/she has a permanent visa and is not otherwise prevented from occupying management positions. Citizens from Mercosur countries (Argentina, Paraguay and Uruguay) and associated nations (Bolivia and Chile) who hold a 2-year Temporary Residence visa can be both owner and manager of an Eireli, in accordance with IN DREI n.34/2017.
a.10 Termination/Dissolution
  • Compliance with Limited Liability Company’s rules, wherever applicable.

("Sociedade Limitada”)

b.1 Applicable Legislation
  • Brazilian Civil Code (Law No. 10,406/2002; from Article 1,052 to Article 1,087);
  • Normative Ruling No. 10, of December 5, 2013 (IN DREI n.10/2013), issued by the Department of Corporate Registration and Integration (DREI), establishing the Registry Manual for each different type of company. Amended by Normative Ruling No.38, of March 6, 2017 (IN DREI n.38/2017). 
b.2 Classification
  • Business company formed by individuals or capital;
  • For profit.
b.3 Legal name
  • Firm Name (“Firma”): Name of one or more of the company's partners, with “e companhia” (& Cia.) and “limitada” (Ltda.), in full or abbreviated;
  • Corporate Name (“Denominação”): Corporate purpose followed by “limitada” (Ltda.), in full or abbreviated.
b.4 Owners
  • 2 (two) or more partners;
  • Individuals or legal entities, of Brazilian or foreign origin.
b.5 Articles of Organization/Incorporation
  • Articles of Organization/Bylaws;
  • Registration and filing at the Commerce Registry (“Junta Comercial”) of competent jurisdiction.
b.6 Capital
  • Divided into membership units;
  • No minimum capital requirement;
  • An increase in capital is admitted, providing all subscribed membership units are paid in;
  • The capital may be subject to reduction in the following cases: 
    • (i) the occurrence of losses; or 
    • (ii) capital is excessive pursuant to the company´s corporate purpose.
b.7 Payment
  • The articles of incorporation must establish the means and deadline for payment;
  • Any assets can be used for payment, provided they are susceptible to cash valuation.
b.8 Ownership/Partnership Liability
  • Limited to paid-in capital;
  • In cases in which capital has not been fully paid, the partners shall be deemed unlimitedly and jointly liable.
b.9 Control and Management
  • Control defined by number of membership units;
  • Resolutions are made during meetings (up to 10 partners) or general meetings (more than 10 partners);
  • The company may be managed by one or more people, partners or non-partners, as indicated on the articles of organization;
  • The company may be managed by a non-partner, if unanimously approved by partners when capital has not been paid, and if approved by 2/3 (two-thirds) when capital is fully paid;
  • A foreigner may be appointed as manager, provided that he/she has a permanent visa and is not otherwise prevented from occupying management positions. Citizens from Mercosur countries (Argentina, Paraguay and Uruguay) and associated nations (Bolivia and Chile) who hold a 2-year Temporary Residence visa can be both owner and manager of an LLC, respecting IN DREI n.34/2017.
b.10. Termination/Dissolution
  • Dissolution occurs in the following cases (as in Article 1,033; Article 1,034; and Article 1,087 of the Brazilian Civil Code):
    • (i) at the end of its term;
    • (ii) unanimous resolution of all members;
    • (iii) resolution of members representing an absolute majority, in companies with an open-ended duration;
    • (iv) insufficient plurality of members;
    • (v) expiration of company’s license to operate;
    • (vi) court decision;
    • (vii) bankruptcy;
  • Judicial or extrajudicial liquidation will take place after the company is terminated. The remaining assets will be distributed to the members proportionally to their respective membership units.

c. CORPORATION (S.A. or Cia.)
("Sociedade Anônima")

c.1 Applicable Legislation
  • Law No. 6,404/1976, a.k.a. "Lei das S.A.", supplemented by Law No. 10,303/2001.
  • Normative Ruling No. 10, of December 5, 2013 (IN DREI n.10/2013), issued by the Department of Corporate Registration and Integration (DREI), establishing the Registry Manual for each different type of company. Amended by Normative Ruling No.38, of March 6, 2017 (IN DREI n.38/2017) 
c.2 Classification
  • Business corporation formed by either public or private capital (either publicly or closely held companies);
  • For profit.
c.3 Legal name
  • Corporate Name (“Denominação”): Fictitious business name and/or founder's, shareholders' and involved people's names, with “Sociedade Anônima” (S.A.) or “Companhia” (Cia.), in full or abbreviated. The latter cannot be placed at the end of the legal name.
c.4 Owners
  • At least two shareholders for closely held companies and three for publicly held ones;
  • Individuals or legal entities (of Brazilian or foreign origin).
c.5 Articles of Organization/Incorporation
  • Articles of Incorporation/Bylaws;
  • Registration and filing at the Commerce Registry (“Junta Comercial”) of competent jurisdiction.
c.6 Capital
  • Divided into shares;
  • No minimum capital requirement, but shareholders must pay in at least 10% of the issuance price of the shares subscribed in cash;
  • The articles of incorporation establish the number of shares, and whether the shares will have an even value or not;
  • Capital may be increased in the following cases:
    • Issuance of shares provided for in the articles of incorporation;
    • Conversion of bonds (debentures) and participation certificates into shares;
    • Resolution of the Annual General Meeting regarding capitalization or reserves or issuance of new shares;
  • The capital may be reduced in the case of a loss or capital that is excessive for the company’s corporate purpose.
c.7 Payment
  • The articles of incorporation must establish the deadline for payment;
  • Any assets can be used for payment, provided they are susceptible to cash valuation.
c.9 Ownership/Partnership Liability
  • No liability: shares subscribed and paid in;
  • Limited to the shares that shareholders have subscribed for and have not yet paid in.
c.10 Control and Management
  • Control defined by shareholders with voting rights. The controlling shareholder owns a majority portion of the voting capital;
  • In compliance with company’s articles of incorporation, corporate management will be performed by the Board of Directors ("Conselho de Administração”) and the Executive Committee ("Diretores"), or solely by the Executive Committee;
  • The chair of the Executive Committee, whether a shareholder or not, must reside in Brazil;
  • The members of the Board of Directors may reside abroad, provided they appoint a representative resident in Brazil.
c.11 Termination/Dissolution
  • Dissolution comes into effect either by court order or by the ruling of administrative authorities with jurisdiction. Incorporation, merger and spin off are forms of dissolution;
  • Judicial or extrajudicial liquidation will take place after the company is terminated. The remaining assets will be distributed to the shareholders proportionally to their respective shares.

Hiring Employees

  • The Consolidation of Labor Laws (“CLT”) was issued in 1943 and remains the main piece of legislation governing employment contracts in Brazil. In 2017, the law was updated by the National Congress in order to better reflect modern-day working relations. These updates went into effect in November of the same year.
  • One of the biggest goals of this reform is to increase the number of people employed under the CLT regime, which is to say “formal” or “registered employees”. All of these workers, including foreigners, must hold a work permit (“Carteira de Trabalho”), in which the terms of employment must be recorded by the hiring company.
  • Other types of professionals are public servants, autonomous professionals and legal entities (generally a single-member company holder who provides services under his or her legal entity). Rural and domestic workers also have their own set of regulations.
  • Outsourcing companies' activities (“terceirização”) is a legal practice in Brazil and it has undergone important changes in 2017. In March of 2018, the government sanctioned a new law, the “Outsourcing Law” (n. 13.429/2017), allowing unlimited outsourcing for businesses, including their core activity (“atividade fim”). Before that, only non-core activities (“atividades meio”) were allowed to be outsourced, such as maintenance, cleaning or security. 


  • CLT rules make no distinction between skilled and unskilled workers or between those engaged in manual, office or professional work. Registered workers are also entitled to benefits such as minimum wage, maximum working hours, overtime pay, paid leave and holidays.
  • Employers must keep official records or cards containing detailed information about each employee. Each year they must file returns listing all of their employees to the local office of the Ministry of Economy, including reporting the number of foreigners and underage workers. Companies are allowed to employ foreign workers up to a limit of 1/3 of their total staff.
  • After last year’s revamp, the CLT has become more comprehensive. Besides regular working contracts, it also regulates intermittent work. For this type of work, there must be a written contract and the contractor cannot earn less per hour than the other hired employees. He or she is also free to work for other companies as well. The new rules also foresee regulation for home office arrangements.
  • One of the most important changes is that collective agreements between unions, employees and companies are placed above the terms of the law, meaning that issues such as vacation conditions, length of daily work hours or lunch breaks may be decided on a case-by-case basis, as long as those terms respect certain limits established by the CLT.
  • Another advance is the possibility to end a labor contract on common grounds: the employer does not have to pay a heavy fine and allows the employee to have access to the Guarantee Fund for Continuing Service (FGTS) - the worker savings account withdrawn in case of dismissal, to buy residential properties, retirement, and other circumstances.
  • It also aims to diminish the number of judicial disputes related to employment relationships. In Brazil, those are decided by specialized labor courts (“Justiça do Trabalho”) which are present in all states of the country and headed by the Superior Labor Court (TST).


The Federal Constitution and CLT provide for a series of minimum benefits that remain untouched by reforms and must be granted by the employer to its employees throughout the employment relationship. Some of these minimum benefits are:

Minimum wage

  • The Federal Government is responsible for establishing the minimum wage. No employee in Brazil shall receive less than the minimum wage. which is reviewed and adjusted every year.
  • Additionally, each category of workers (e.g., salesmen, drivers, doctors, etc.) has a professional minimum wage, which shall not be lower than the minimum wage established by the Federal Government. Wage rates set by local labor unions are typically higher than the general minimum wage.
  • Each state may also establish a local minimum wage by law.

Maximum Hours/Overtime Pay

  • Regular working hours are limited to 8 hours per day and 44 hours per week. Under the CLT regime, as long as the weekly limit of 44 hours is respected, the employees’ regular work schedule can be increased by overtime hours, which cannot exceed the legal limit of two hours per day.
  • Overtime work during business days requires an additional overtime payment of at least 50% more than the regular rate.
  • Work on Sundays and holidays requires a permit from the Ministry of Labor and a minimum overtime payment of at least 100% more than the regular rate.
  • Collective bargaining agreements can provide for higher overtime payments.

Paid leave

  • In Brazil, every employee is entitled to an annual paid leave of 30 calendar days, in addition to holidays occurring during the year. The employee’s vacation right is acquired after one year of continuous employment. The leave must be taken in the course of the 12 months following the anniversary date of employment. They can also be split into up to three different periods - one over 14 consecutive days and two others, more than 5 consecutive days each.
  • The Federal Constitution also states that employers must pay an additional 1/3 of the monthly salary as a vacation bonus during the month the employee is on vacation.

Paid holidays

  • The following are the national legal paid holidays that must be observed. As mentioned above, an employee required to work on any of these holidays must be paid at the rate of at least 100% over his or her normal wage.
    • New Year’s Day | January 1;
    • Carnival | varies, February;
    • Good Friday/Easter | varies, April;
    • Tiradentes Day (Brazilian Martyr for National Independence) | April 21;
    • Labor Day | May 1;
    • Corpus Christi | varies, June;
    • Independence Day | September 7;
    • Our Lady of Aparecida | October 12;
    • All Souls’ Day | November 2;
    • Republic Day | November 15;
    • Christmas Day | December 25.
    • There are also paid state and municipal holidays.

Christmas Bonus (“13th Salary")

  • The Constitution also provides that all employers must pay a Christmas Bonus, which is commonly known as the “13th salary”. This is an additional monthly salary payment at the end of each year. This payment is made in two installments: the first is paid between February and November of each year and the second installment is paid on or before December 20. The Christmas Bonus is paid based not on the base salary, but on the employee’s entire compensation, including the usual overtime and bonuses.

Health and safety

  • Although the CLT contains a chapter that deals exclusively with health and safety matters, the Ministry of Labor also publishes Administrative Rules which establish specific provisions in connection with, among other matters, the prevention of and protection from accidents, personal safety equipment, building safety requirements, transportation and handling of materials, hazardous work conditions, and environmental contamination.
  • Also, some employers must establish an internal accident prevention committee in every establishment. This committee comprises employer and employee representatives and must hold periodic meetings to prevent on-the-job accidents.

Paid maternity leave

  • Female employees in Brazil are entitled to 120-days of paid maternity leave.
  • Salary payments during maternity leave are made by the employer, who may offset the corresponding amount against Social Security charges.
  • Under the CLT, an employer cannot dismiss pregnant employees from the confirmation date of the pregnancy until at least five months after the birth.

Other benefits

  • In addition to the rights established above, employers may voluntarily provide further benefits at their discretion. In Brazil, employers usually provide health care plans and life insurance policies to their employees. Most usual fringe benefits granted to employees (i.e., health insurance, pension fund, life insurance, education, etc.) are not considered salary for any purpose.