Legal Definition

Law n. 4.131 of 1962 is the primary law that regulates foreign capital in Brazil. The law guarantees that foreign capital in Brazil will be treated on an equal footing with domestic capital unless the investment falls within one of the few exceptions. It’s important to stress that, since 1995, Brazilian law considers that companies incorporated in the country are national companies, regardless of national or foreign control.

The same law defines foreign capital as being an asset, machinery or equipment which enters Brazil, as well as financial or monetary resources, intended to produce goods and services or to be used in economic activities in the country. In all cases, it must belong to individuals or legal entities residing, domiciled, or with headquarters outside Brazil.

You can find below concise information about the entry of capital in Brazil for productive investment:

Legal Framework:

• Law n. 4.131 of September 3, 1962 (Foreign Capital Law) and Law n. 4.390 of August 29, 1964.
• Decree n. 55.762 of February 17, 1965, and its subsequent amendments.
• Law n. 11.371 of November 28, 2006 (provides for exchange transactions, registration of foreign capital), as well as rules of the National Monetary Council (CMN) and the Central Bank of Brazil (BCB) - in particular, CMN Resolution n. 3.568 of May 29, 2008 and BCB Circular 3.691 of December 16, 2013 (for exchange transactions); BCB Circular n. 3.689 of December 16, 2013 (for registration of foreign capital); and BCB Circular n. 3.857 of November 14, 2017 (for administrative regulation).

Definition of Foreign Direct Investment (FDI)

• For registration purposes, FDI is defined as permanent interests in companies in Brazil, held by an investor (individual or legal entity) not resident in the country or resident, domiciled or headquartered abroad, through the ownership of shares or quotas representing the capital stock of Brazilian companies, and the outstanding capital of foreign companies authorized to operate in Brazil.

Registration at the Brazilian Central Bank (BCB)

• The registration at BCB is made through the Electronic Declaratory Registry - RDE-IED, in the case of FDI or the Financial Operations Declaratory Registry - RDE-ROF, in the case of financial transactions (such as Direct Loans, Securities, Import Financing, Advance Receipt of Exports, Leasing and Property Rights (royalties), including renegotiation, assumption and conversion transactions).
• The Non-Resident Declaratory Register – RDE-CDNR is required of individuals or legal entities that are not resident in the country and wish to register transactions involving foreign capital in the RDE-ROF and in the RDE-Portfolio. The RDE-Portfolio allows the registration of foreign investments in the financial and capital markets, investment funds and DRs (Depositary Receipts).
• The registration of non-residents is usually done through a Brazilian company. Regarding FDI, it is mandatory that a foreign company constitute a legal Brazilian entity with a registered number known as CNPJ (the acronym in Portuguese for “National Register of Legal Entities”) which acts as a representative of the non-resident in Brazil. This registration must be done prior to the electronic registration at BCB.
• The Brazilian company is required to keep documents supporting the registration for 5 years, counting from the registration date, for presentation to BCB if requested.
• The registrations are done in the electronic system of Banco Central – SISBACEN -, informing the amount invested in foreign currency and its equivalent in national currency (art. 4, Law n. 4.131/1962). Such registration is necessary and mandatory for future remittances of profits abroad, repatriation of invested capital and registration of reinvestment of profits, among others.

Taxes

• Foreign capital that enters the country destinated to FDI is not subject to taxation, except for the Tax on Credit, Exchange and Insurance Operations or Related to Securities (IOF).

You can find below concise information about the entry of capital in Brazil for productive investment:

Legal Framework:

• Law n. 4.131 of September 3, 1962 (Foreign Capital Law) and Law n. 4.390 of August 29, 1964.
• Decree n. 55.762 of February 17, 1965, and its subsequent amendments.
• Law n. 11.371 of November 28, 2006 (provides for exchange transactions, registration of foreign capital), as well as rules of the National Monetary Council (CMN) and the Central Bank of Brazil (BCB) - in particular, CMN Resolution n. 3.568 of May 29, 2008 and BCB Circular 3.691 of December 16, 2013 (for exchange transactions); BCB Circular n. 3.689 of December 16, 2013 (for registration of foreign capital); and BCB Circular n. 3.857 of November 14, 2017 (for administrative regulation).

Definition of Foreign Direct Investment (FDI)

• For registration purposes, FDI is defined as permanent interests in companies in Brazil, held by an investor (individual or legal entity) not resident in the country or resident, domiciled or headquartered abroad, through the ownership of shares or quotas representing the capital stock of Brazilian companies, and the outstanding capital of foreign companies authorized to operate in Brazil.

Registration at the Brazilian Central Bank (BCB)

• The registration at BCB is made through the Electronic Declaratory Registry - RDE-IED, in the case of FDI or the Financial Operations Declaratory Registry - RDE-ROF, in the case of financial transactions (such as Direct Loans, Securities, Import Financing, Advance Receipt of Exports, Leasing and Property Rights (royalties), including renegotiation, assumption and conversion transactions).
• The Non-Resident Declaratory Register – RDE-CDNR is required of individuals or legal entities that are not resident in the country and wish to register transactions involving foreign capital in the RDE-ROF and in the RDE-Portfolio. The RDE-Portfolio allows the registration of foreign investments in the financial and capital markets, investment funds and DRs (Depositary Receipts).
• The registration of non-residents is usually done through a Brazilian company. Regarding FDI, it is mandatory that a foreign company constitute a legal Brazilian entity with a registered number known as CNPJ (the acronym in Portuguese for “National Register of Legal Entities”) which acts as a representative of the non-resident in Brazil. This registration must be done prior to the electronic registration at BCB.
• The Brazilian company is required to keep documents supporting the registration for 5 years, counting from the registration date, for presentation to BCB if requested.
• The registrations are done in the electronic system of Banco Central – SISBACEN -, informing the amount invested in foreign currency and its equivalent in national currency (art. 4, Law n. 4.131/1962). Such registration is necessary and mandatory for future remittances of profits abroad, repatriation of invested capital and registration of reinvestment of profits, among others.

Taxes

• Foreign capital that enters the country destinated to FDI is not subject to taxation, except for the Tax on Credit, Exchange and Insurance Operations or Related to Securities (IOF).

No Restrictions on Most FDI

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:

Prohibitions:

• Activities involving nuclear energy (Some nuclear radioisotopes are available to the private sector for medical uses. Regarding the production of nuclear energy, the Angra 3 Nuclear plant concession is expected to establish a new legal model allowing the participation of foreign companies. The Brazilian government is also considering allowing foreign companies to participate in uranium mining);
• Mail and telegraph services, except parcel delivery;
• Aerospace (launch and deployment of satellites, vehicles, aircraft). The prohibition does not apply to the manufacturing or trading of these goods or to the launch of satellites, vehicles and aircraft authorized by Brazil and the USA in Alcantara Space Center, in accordance with Decree n. 10.220/2020.

Restrictions and Limitations*:

• Acquisition or rental of rural property (authorization requirements from the National Institute for Rural Settlement and Agrarian Reform (INCRA) may apply or authorization by the National Congress may be demanded for larger areas);
• Financial institutions (permission from the BCB may be demanded on specific circumstances)
• 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 in general, with specific provisions for operations on border regions or indigenous territory;
• Health assistance provision by foreign companies is restricted to a specific set of possibilities, relating to (i) the establishment and operation of hospitals and clinics; (ii) the establishment and operation of family planning research organizations; (iii) support health services provided by companies to their own labor force; (iv) activities related to donations from United Nations bodies; and (v) other cases provided in specific legislation.

* Foreign capital may be subject to limitations, or prior authorization from public authorities may be required

It is worth noticing that restrictions to foreign capital on air transportation companies were wiped out by Law n. 13.842 of 2019.

For more information, talk to our team.

Private Equity Funds

Brazilian Private Equity Investment Funds (in Portuguese “Fundo de Investimento em Participação” - FIP) are ruled by Instructions n. 578/16 and n. 579/16 issued by the Brazilian Securities and Exchange Commission ("Comissão de Valores Mobiliários” – CVM). Both instructions are considered very important steps to comply with international benchmarks. Together they modernize the rules on the constitution, operation and administration of Equity Investment Funds (FIPs).

CVM Instruction 578 addresses the constitution, operation and administration of FIPs while CVM Instruction 579 provides accounting criteria for the recognition, classification and measurement of assets and liabilities, as well as those for revenue recognition, appropriation of expenses and disclosure of information in the financial statements of FIPs. According to CVM Instruction 578, FIPs are considered closed-ended funds, so they are not organized as companies, corporations, partnerships or trusts but as a pool of assets jointly owned by the funds’ shareholders under the structure of a co-property (condominium), with no legal entity status, despite its ability to undertake duties and obligations, as well as to sue and be sued.

The CVM Instruction 578/16 consolidated the current categories of FIP´s as follows:

• Seed Capital FPI / “Capital Semente”: Companies with annual gross revenue up to R$ 16 million in the year immediately prior to the FIP’s first investment or said amount collectively in the last 3 financial years.
• Emerging Companies (FIP-EE)/ “Empresas Emergentes”: Companies with annual gross revenue up to R$ 300 million in the year immediately prior to the FIP’s first investment or said amount collectively in the last 3 financial years.
• Infrastructure (FIP-IE)/ ”Infraestrutura”: Companies that develop projects in the industries of energy, transportation, water and sanitation, irrigation and any other prioritized industries. *
• Research & Development (FIP-PD&I)/ “Produção Econômica Intensiva em Pesquisa, Desenvolvimento e Inovação”: Companies in the field of research, development and innovation. *
• Multi-strategy/ Multiestratégia: Those which do not fit in the other categories.

* Each FIP-IE and FIP-PD&I must have at least 5 (five) quota holders, and each quota holder cannot have more than 40% (forty percent) of the shares issued or earn a return higher than 40% (forty percent) of the fund's income.

Venture Capital Funds

Since the issuance of CVM Instruction 578/16, venture capital funds in Brazil are considered categories of FIP, specifically:

• FIP Emerging Companies (FIP-EE); and
• Seed Capital FIP (in Portuguese, FIP “Capital Semente”).

The Seed Capital FIP is designed to foster the development of startups and small entrepreneurs from different sectors whereas the FIP-EE is destined for investment in companies in a more advanced stage of maturity.

A crucial resolution stipulated by CVM Rule 578/16 is that a Seed Capital FIP (and the other FIP categories, except for FIP-IE and FIP-PD&I) is able to invest in limited liability companies (LLCs) as long as they comply with the annual gross revenue requirement for invested companies by a Seed Capital FIP. Therefore, the invested LLCs must have an annual gross revenue of up to R$ 16 million in the year immediately prior to the FIP’s first investment or said amount collectively in the last 3 financial years.

For more information, talk to our team.

Foreign companies opening a Branch in Brazil

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.

To ease these procedures, the federal government allows foreign companies to request the opening of branches, agencies and establishments in Brazil through the gov.br website.

Normative Instruction n. 77/2020, which came into force on April 1, 2020, also allows changes to the company’s contract or bylaws to be equally requested online. The new instruction compiled the rules for the operation of branches of foreign companies in the country, revoking the four previous regulations regarding the matter.

Through the gov.br website the foreign company can fill in the application for the installation and operation of the Office, Branch, Agency or Facility in Brazil. The following documents are required:

1. Act of deliberation on the operation of an Office, Branch, Agency or Facility in Brazil;
2. Full content of the contract or bylaws;
3. List of partners or shareholders, as well as a list of members of all management bodies, with the names, professions, domiciles and number of shares or quotas, except when, due to the legislation applicable in the country of origin, it is impossible to comply with this requirement;
4. Proof that the company is constituted according to the law of the country of origin;
5. Act of deliberation on the appointment of the representative in Brazil, accompanied by a power of attorney that empowers him/her to accept the conditions under which authorization is given and full powers to deal with any issues and resolve them definitively, being able to be sued and to receive summons by society;
6. Declaration by the representative in Brazil that he/she accepts the conditions under which the authorization for operation by the Federal Government is given;
7. Last balance sheet; and
8. Proof of payment for the service.

The legal representative is the person in charge of filing the application process and he/she may be Brazilian or foreign citizen; however, he/she must have a domicile in Brazil.

The incorporation of a Brazilian subsidiary is not subject to a similar authorization process.

Types of companies in Brazil:

Types of companies in Brazil:

a. LIMITED-LIABILITY SOLE PROPRIETORSHIP - EIRELI
("Empresa Individual de Responsabilidade Limitada")

a.1 Applicable Legislation

• Law n. 12.441/2011, which amends provisions of the Brazilian Civil Code;
• Normative Instruction n. 81, of June 6, 2020 (IN DREI n. 81/2020), issued by the Department of Corporate Registration and Integration (DREI), established the Registry Manual for each different type of company. Its Annex III corresponds to the Registry Manual for Limited-Liability Sole Proprietorship Enterprises.

a.2 Classification

• Individual company;
• For profit.

a.3 Legal name

• Firm Name (“Firma”): Proprietor’s full name, followed by “EIRELI”;
• Corporate Name (“Denominação”): Any words, in Portuguese or in a foreign language, except those restricted by article 22 of IN DREI n. 81/2020, 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 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. 81/2020.

a.10 Termination/Dissolution

• Dissolution is determined by the proprietor through the registration at the correspondent Commerce Registry of a Dissolution Decision, containing: a dissolution resolution and the appointment of a liquidation representative.

b. LIMITED-LIABILITY COMPANY (Ltda.)
("Sociedade Limitada”)

b.1 Applicable Legislation

• Brazilian Civil Code (Law n. 10.406/2002; from Article 1.052 to Article 1.087);
• Normative Instruction n. 81, of June 6, 2020 (IN DREI n. 81/2020), issued by the Department of Corporate Registration and Integration (DREI), established the Registry Manual for each different type of company. Its Annex IV corresponds to the Registry Manual for Limited-Liability Companies

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”): Any words, in Portuguese or in a foreign language, except those restricted by article 22 of IN DREI n. 81/2020, followed by “limitada” (Ltda.), in full or abbreviated.

b.4 Owners

• 1 (one) 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. 81/2020.

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):
• At the end of its term;
• Unanimous resolution of all partners;
• Resolution of partners representing an absolute majority, in companies with an open-ended duration;
• Insufficient plurality of partners not reconstituted in 180 days;
• Expiration of company’s license to operate;
• Court decision;
• 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 n. 6.404/1976, a.k.a. "Lei das S.A.", supplemented by Law n. 10.303/2001.
• Normative Instruction n. 81, of June 6, 2020 (IN DREI n. 81/2020), issued by the Department of Corporate Registration and Integration (DREI), established the Registry Manual for each different type of company. Its Annex V corresponds to the Registry Manual for Corporations

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

• A deposit receipt of at least 10% of the issuance price of the shares subscribed must be submitted for registration;
• 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.

For more information, talk to our team.

Labor Law in Brazil

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. The updates, established by Law n. 13.467/2017, took effect in November of the same year. 

One of the main 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 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 2017, 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. 

The CLT

CLT rules make no distinction between skilled and unskilled workers or between those engaged in manual, office or professional work. Registered workers are 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 its 2017 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, intermittent workers or not. These workers are 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 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. 

The new rules also aim to decrease 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).

Workforce Benefits

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. In 2020, the Brazilian minimum wage was set at R$ 1,045.00.
• 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.
• Each state may also establish a local minimum wage by law, which shall not be lower than the minimum wage established by the Federal Government.

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, except when the collective agreement stipulates hour.
• 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.

January 1st: New Year’s Day 

April 21: Tiradentes Day (Brazilian national hero) 

May 1st: Labor Day 

September 7: Independence Day (celebrates Brazil’s independence from Portugal in 1822) 

October 12: Our Lady of Aparecida (patron saint of Brazil) 

November 2: All Souls’ Day 

November 15: Republic Day (celebrates the proclamation of Brazil as a republic in 1889) 

December 25: Christmas Day

General Elections are also national public holidays, but they take place on Sundays and only every two years, on the first and last weekends of October.

• Moveable Religious Holidays

These are regularly observed by most of the population. Most businesses stay closed on those dates.

February or early March: Carnival and Ash Wednesday (Carnival falls on the Monday and Tuesday before Ash Wednesday, which in turn falls 46 days before Easter. Celebrated nationwide.)

Late March or April: Good Friday and Easter Sunday

May or June: Corpus Christi (falls on Thursday)

• Traditional Holidays

Although not official, these are considered holidays by much of the population. Therefore, some businesses may close on these days. In doubt, it is advisable to reach out to your contact beforehand to check availability during those dates.

December 24: Christmas Eve 

December 31: New Year’s Eve

• Other Breaks

States and cities may have their own locally-observed holidays. For example, Rio de Janeiro's patron Saint Sebastião day, celebrated on January 20, is a municipal holiday. In São Paulo, the city's birthday is celebrated on January 25.

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.

Visas

Business Visa

Before making any travel arrangements, investors should check whether they will be required a visa. Currently, Brazil has agreements with approximately 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. However, citizens from Australia, Canada, the United States and Japan are exempt of the reciprocity principle, having their business/tourism (visit) visa requirement unilaterally waivered in 2019.

For citizens in countries that are not exempt from visas, travelers may 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.

Residence Visa

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.

Traditional residence visas are also 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.

According to the Brazilian Ministry of Foreign Affairs, nationals of the signatory states of the Mercosur Residency Agreement (Argentina, Bolivia, Chile, Colombia, Ecuador, Paraguay, Peru and Uruguay) can establish temporary residence in Brazil, in accordance with the relevant articles of that agreement (internalized by Presidential Decree 6.975 / 2009). After 2 years, the temporary residence may, having fulfilled the requirements foreseen in said decree, be transformed into residence for an indefinite period.

Investors

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 temporary residence visa, as well as those who have received job offers in Brazil, according to the 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. 

For more information, talk to our team.

Taxation in Brazil

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. Some of the contemplated reforms include a proposal to standardize two contribution charges, namely PIS and Cofins, currently divided into two categories, under a single regime. Other legislative proposals aim at standardizing larger sets of taxes.

All existing legal entities must calculate and pay taxes regularly (monthly, quarterly, or annually, 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, in the Portuguese acronym for “National Register of Legal Entities”) to collect taxes in the Brazilian system.

Tax holidays are offered to certain industries operating in specific areas. No tax consequences arise from converting a non-incorporated business into an incorporated entity or from changing the corporate form, such as from a private limited liability company ("limitada") to a corporation ("sociedade anônima").

Main taxes and contributions in Brazil

SERVICES

• ISS (Municipal Services Tax)

Varies between 2% to 5% (depending on the type of service), on the service price.

• INSS (Social Security Contribution)

Varies between 7,5% to 14%, depending on the salary range. INSS is paid both by the employee, discounted from the gross salary (Service), and by employers, on total payroll (Payroll).

PRODUCTS               

• ICMS (State Goods and Services Tax):

Intrastate rates are defined and levied by states on the circulation of goods within its borders. Standard intrastate rates may vary considerably.

Interstate levels are generally levied at 7% and 12%, and 4% on imported goods (the final product must include more than 40% imported content).

• IPI (Tax on manufactured goods)

Ranging generally from 0% to 45%, with few exceptions up to 300%, (such as cigarettes), depending on the product. Rates are defined by product code (HS code) and are informed by the IPI Tax Rates Table – TIPI.

• II (Import Duty)

Foreign merchandise entering Brazil incurs import duties generally ranging from 0% to 20%, depending on the product. Rates are contained in the Mercosur Harmonized Tariff Schedule (TEC).

• IE (Export Tax)

Generally 30% when applicable (most exports do not collect it), but it may be raised or lowered to meet the objectives of Brazil’s exchange rate and foreign trade policies. The maximum rate may reach 150%.

• IOF (Tax on Financial Transactions)

Levied on credit, exchange, insurance, and financial operations in general, ranging from 0% to 25%, depending on the transaction. The current IOF rate for exchange operations (buying and selling dollars) is 1.1%. Payments abroad with Brazilian credit cards, prepaid cards, and travelers' cheques have a 6.38% IOF rate.

SERVICES AND PRODUCTS

• IRPJ (Corporate Income Tax)

At a rate of 15% on profit, plus an additional 10% on the monthly income that exceeds BRL 20,000.

• PIS/Pasep (Social Contribution on Gross Revenue)

Used to fund unemployment insurance and the Workers’ Assistance Fund. There are two different regimes, which vary on the tax calculation method chosen by the company. Cumulative Regime (applied to legal entities collecting IRPJ by Presumptive Profit): 0.65% of gross revenue. Non-Cumulative Regime (IRPJ by Taxable Profit): 1.65% of gross revenue.

• Cofins (Social Contribution Tax)

Used to fund social security. It is usually paid alongside PIS and follows the same regimes. Cumulative Regime (IRPJ by Presumptive Profit): 3% of gross revenue. Non-Cumulative Regime (IRPJ by Taxable Profit): 7.6% of taxable revenue.

• CSLL (Social Contribution Tax on Profit)

9% (15% for insurance companies, financial institutions and credit unions).

PAYROLL

• FGTS (Guarantee Fund for Continuing Service)

8% of employee's gross salary.

• INSS (Social Security Contribution)

20% on total payroll. INSS is paid both by the employee, discounted from the gross salary (Service), and by employers, on total payroll (Payroll)

• SAT/RAT (Occupational Hazards Insurance)

1% to 3% of payroll, according to the risk level of the activity.

• Third Party Contribution Taxes (“Contribuição a terceiros”)

Contributions paid for social entities and funds, according to business activities (determined by the FPAS code table). SESI/SESC Social Programs, SENAI/SENAC Training Programs, SEBRAE Program for Small Companies, and INCRA Supplementary rural pension are some of these entities.

Total contribution per business activity range from 0% to 7.7%. The general categories for Industry and Commercial Services incur on a final rate of 5.8%, while general categories for Agribusiness and Transportation Services incur on a final rate of 5.2%.

PROPERTY

• IPTU (Urban Real Estate Tax)

There is no minimum or maximum rate established by federal law (it is therefore established by each municipality). Escalation criteria: location, value, use, and social function.

• ITR (Rural Real Estate Tax)

Ranging from 0.03% to 20% (depending on land area and degree of land use).

• ITBI (Stamp Duty on Real Estate Transfers)

There is no minimum or maximum rate established by federal law (it is therefore established by each municipality). Single rate, non-progressive regime.

Business accounting

For tax purposes, business profits are calculated based on net income, as reported on the income statement (profit and loss account) and adjusted for non-taxable income and non-deductible expenses. Intercompany transactions are subject to transfer pricing rules.

Capital gains are taxed as ordinary income. The cash basis may be used to calculate profits on certain long-term sales of permanent assets. Capital losses may only be offset by capital gains. Unused capital losses are treated similarly to income tax losses with regard to limits on use and the carryforward period.

Gains from the sale of depreciable property are treated as ordinary non-operating income and not as capital gains. Corporate taxpayers may choose to include exchange gains and losses in their taxable income, on an accrual basis (whether or not realized, monthly exchange gains will be taxable and exchange losses will be deductible) or on a cash basis (it will be taxable or deductible only when realized). Companies participating in specific industries, such as banking, insurance, and leasing, are subject to special tax rules.

Dividends

Dividends are not subject to withholding income tax and neither is the recipient. Received from other local companies, including subsidiaries and affiliates, they are not subject to corporate income tax. The payment of dividends in kind is not prohibited by corporate law, provided that specific rules and terms are clearly defined in the Articles of Incorporation or the payment is approved at the Annual Shareholders’ Meeting.

Taxation of Equity Investment Funds

Due to the fact that Equity Investment Funds (in Portuguese “Fundos de Investimento em Participação” – FIPs) are deemed to be a condominium, the sale of any asset is exempt of Brazilian taxes (income taxes and tax on financial transactions “IOF”) until income is distributed to its shareholders. In general, the gains obtained by the portfolio of the investment funds are exempt of withholding tax (WHT). However, where FIPs do not hold a portfolio comprising at least 67 percent of stocks of corporations, convertible debentures or subscription bonuses, it will be treated as a fixed income investment and thus subject to income tax at rates ranging from 15% to 22.5%, depending on the term of the investment.

Any gains obtained upon sale or redemption of shares of FIPs by investors resident in Brazil, are generally subject to withholding tax at a 15% rate.

Brazilian regulation allows foreign investors to invest in the same financial products as the ones available for Brazilian investors, as long as the foreign investor is duly registered with the Brazilian Securities and Exchange Commission ("Comissão de Valores Mobiliários” – CVM), is represented by a financial institution and the foreign investment is registered in accordance with CMN Resolution n. 4.373/2014.

The acquisition of shares of investment funds in Brazil will generally be subject to the tax on transactions with bonds and securities (usually known as IOF/Bonds) if the investment in such shares lasts less than 30 days. Investments that last longer than 30 days will not be taxed.

For more information, talk to our team.

Property and land in Brazil

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.

It is necessary to have a CNPJ or CPF (Corporate or Individual Taxpayer Identification Number, respectively) provided by the Federal Revenue Service (RFB).

To apply for a CPF, the foreigner must carry out the following sequence of procedures:

• Complete the electronic form in the Portuguese, Spanish or English versions, available at RFB's website;
• Submit the form along with a copy of his/her identification document (with photo, and place & date of birth) to a Brazilian consular office (consulate or embassy with a consular sector).

The following are accepted as identification document: passport; National Registry of Migration Card /National Register of Foreigners (CRNM/RNE); or other documents, at the discretion of the RFB.

Although it is not mandatory, it is advisable to obtain legal support from an attorney, as well as a real estate agent registered at CRECI (in the Portuguese acronym for Real Estate Agents Regional Council), the professional organization regulating professional property managers and real estate brokers. 

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 communion property system and have Brazilian children.

Corporations whose capital originates from another country, even with the permission to operate in Brazil, also face limitations imposed by law. This is also the case for Brazilian corporations in which foreigners control the majority of capital, whether they are individuals or corporations, residing or having headquarters in Brazil or abroad.

The agency that regulates the size of the reference unit for land, called Undefined Land Holding Units (MEI), is the National Institute of Colonization and Agrarian Reform (INCRA).

In case of acquisition of land in important areas for national security by foreigners (individuals or corporations), independently of its size, prior approval from the National Defense Council is necessary. 

Individuals

There are some conditions related to the leasing or acquisition of land by foreign individuals, especially when it comes to the size of the property.

The area that foreigners are allowed to purchase is limited to 50 MEIs. If the property is smaller than 3 MEIs, authorization from INCRA is not required, respecting only the general restrictions established by law. Properties larger than 50 MEIs require authorization by the National Congress.

In the case of estates between 3 to 50 MEIs, INCRA authorization becomes mandatory, but not for the land-use plan (which is only compulsory in case of estates bigger than 20 MEIs).

Companies

Foreign companies may acquire properties up to 100 MEIs and must present a land-use plan to INCRA to obtain permission, regardless of the size of the land. If the property is larger than 100 MEIs, the purchase must be authorized by the National Congress. 

It is also important to notice that the sum of the area of estates larger than 3 MEIs purchased or leased by foreigners, individuals or companies in any one municipality cannot exceed 25% of the total area of the municipality. Furthermore, the combined area of properties owned by foreigners of the same nationality cannot be larger than 10% of the municipality area. Foreigners married to a Brazilian citizen with a communion property system or that have Brazilian children are exempted from municipality possession percentage restrictions.

The main requirements for the acquisition and leasing of land by foreigners in Brazil are:

For individuals:

• Being a permanent resident in Brazil and enrolled in the National Registry of Migration – (RNM, formerly RNE) under a valid status;
• Providing a land-use plan (only for areas above 20 MEIs);
• LIMIT: 50 MEIs.

For companies:

• Registration at the Commerce Registry ("Junta Comercial") in the Brazilian State where it has its headquarters – in the case of Brazilian corporations controlled by foreigners, whether they are individuals or legal entities, residing or with headquarters abroad;
• Official authorization to operate in Brazil, in the case of a foreign legal entity, that is, one in which foreigners control all capital;
• Clear provision in its Articles of Organization regarding agriculture, livestock, forestry, tourism, industry or settlement activities;
• Providing a land-use plan, regardless of the size of the area to be acquired or leased;
• LIMIT: 100 MEIs.

Land-Use Plan

When required, the land-use plan must be submitted to INCRA and, depending on the nature of the endeavor, it may be forwarded to other government departments for approval. 

The plan must contain the following information:

1. Justification of the proportionality between the amount of land to be acquired and the size of the project; 
2. Physical and financial schedule for investment and implementation; 
3. Possible use of official credit to finance all or part of the venture; 
4. Logistical feasibility of project implementation and, in the case of an industrial project, demonstration of compatibility of the land location with the type of plant to be built; 
5. Proof of compliance with the criteria for Ecological and Economic Zoning of Brazil (ZEE), which is a policy tool used to guide land use, whenever applicable. The ZEE establishes, for example, which crops are best suited economically for growing in a given part of the country, taking into account measures and standards of environmental protection and biodiversity. 

For more information, talk to our team.

Environmental Policy, Regulation, and Licenses

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 better suit the recent Brazilian reality.

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.

Besides the ministry, Brazil's government includes other entities assigned to implement environmental laws and ordinances in different areas. Examples are the National Council of the Environment (CONAMA), the National Council of the Amazon (CONAMAZ), the National Council of Water Resources (CNRH), the Chico Mendes Institute for Biodiversity Conservation (ICMBio), the Brazilian Environmental Protection Agency (IBAMA), and the Brazilian National Forest Program (PNF/CONAFLOR). 

Among those agencies, IBAMA is the most important, being responsible for implementing new policies and standards for environmental quality, evaluating environmental impact, examining environmental degradation, and issuing environmental licenses. It also has administrative and financial autonomy, and is responsible for issuing authorizations, environmental infraction notices, opening administrative proceedings to investigate environmental infractions and applying correspondent sanctions (including fines, embargo, or suspension of activities/products, etc.). In the case of environmental crimes, IBAMA executes police powers and is responsible for informing federal authorities for further prosecution.

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 starting an industrial, infrastructure or agricultural project in Brazil (i.e., effective or potentially polluting activities) it is necessary to obtain environmental licensing, which is part of general licensing. Some commercial developments may also require these licenses, depending on the zoning laws in a given municipality. The main goal is to analyze the potential impact that new undertakings may have on the ecosystem and avoid harm to the environment.

Types of environmental licenses

Resolutions n. 01/1986 and n. 237/1997 of the National Environmental Council (CONAMA) establishes the main types of projects that are subject to environmental licensing.  

As a rule, environmental licensing is divided in three stages and each one requires a specific license, as below: 

Preliminary License (“Licença Prévia” - LP)

This license must be requested in the preliminary stage of project planning and design, when different locations and technological alternatives can be considered. It determines the environmental viability of the business and has the purpose of defining the conditions under which the enterprise becomes compatible with the preservation of the environment where it will perform its activities.  At this stage, the interested party carries out the Environmental Impact Study (EIA – “Estudo de Impacto Ambiental”) and the Environmental Impact Report (RIMA – “Relatório de Impacto Ambiental”). The license is granted setting the conditions and mitigation measures that should go with the execution of the project.

Installation License (“Licença de Instalação” - LI)

After obtaining the LP, the business developer must produce the engineering design for the project following the conditions and measures defined in the LP in order to apply for an LI. It will be granted if confirmed that the designed project meets those conditions and measures previously set. If the LI is issued, the developer can start the implementation of the project. When the project is completed and ready to start, the developer can request an Operation License.

Operation License (“Licença de Operação” - LO)

This license authorizes the entrepreneur to start his activities. It is issued after the competent authority checks if the conditions established in the LP and LI were met.

To start an environmental licensing process at the Brazilian Environmental Protection Agency (IBAMA), the interested party must complete the Activity Characterization Form (FCA – “Ficha de Caracterização de Atividade”), which is the standard electronic form for the licensing request. 

For more information, talk to our team.

Financing – The Brazilian Development Bank (BNDES)

The National Bank for Economic and Social Development (Portuguese: Banco Nacional de Desenvolvimento Econômico e Social, abbreviated: BNDES) is the Brazilian federal development bank and plays the role of the major supplier of long-term financing in the country, mostly in the form of credit.

It is structured as a federal company associated with the Ministry of Economy and its stated mission is “to enable solutions that add investments to the sustainable development of the Brazilian nation”.

As a public company BNDES provides financial support to private companies with headquarters and management in Brazil (regardless of the size) which have projects that promote innovation, regional development and social and environmentally friendly activities.

Sectors and funding

You can find below some of the BNDES priority sectors and their support policies:

• Infrastructure: To finance the energy sector, through the financing of hydro, wind, thermal, nuclear and biomass energy generation, as well as support for transmission, distribution and rationalization of energy use.
• Export: To finance the expansion of the export capacity of Brazilian companies, supporting the production of goods and services for the foreign market (pre-shipment) and financing the marketing of these products abroad (post-shipment).
• Industry, trade and services: To finance investment projects for the implantation, expansion and modernization of industries and businesses in the trade and services sector. National goods and services can be supported, including equipment and expenses with the development team; working capital; and the import of new machines and equipment that do not have a national similar.
• Agriculture: To finance the acquisition of agricultural tractors and investments in irrigation; expenses up to the first harvest or crop; beef cattle raising; and formation or reform of pastures, production improvement projects and slaughterhouses, as well as invests in agribusiness projects through equity participation and guarantee services to companies in the sector.
• Innovation: To finance capacity building and the development of innovative environments. The conditions for supporting investment plans in innovation are the most favorable within the whole range of BNDES funding lines and programs.  The lines provided for innovation support operations of companies of all sizes and sectors.
• Environment: BNDES supports sanitation, waste management, energy efficiency and conservation projects in biomes. In all supported enterprises, the presentation of environmental licenses is required. In the sectors considered most critical, additional socio-environmental criteria are established as a condition for financial support.
• Small and medium-sized enterprises (SMEs): BNDES offers favorable conditions to smaller companies, which also have exclusive instruments, such as the BNDES Card, which are reflected in more advantageous financial conditions, such as lower interest rates and longer payment terms.
• Capital Markets: BNDES, through its wholly owned subsidiary BNDES Participações S.A. (BNDESPAR), supports Brazilian companies through variable income instruments, in addition to its financing products.

Industry and tax incentives

Ex-tariff

Brazil's Ex-tariff regime allows for a temporary reduction on current import duties for capital goods and computer and telecommunications goods, and for their parts, pieces, and components, with the primary condition being the nonexistence of an equivalent product being manufactured in the country. The final goal of this policy is to restructure Brazil's industrial park and infrastructure services.

          The procedure for applying for an ex-tariff concession is briefly described below:

1. Applications for the grant of the ex-tariff regime (new, renewal, amendment and revocation) must be filled out, only and exclusively, through the Electronic Information System (SEI) of the Ministry of Economy.
2. The applications will be analyzed by the Secretariat of Industry Development, Trade, Services, and Innovation of the Ministry of Economy (SIDTSI).
3. After that, a public consultation will be held to allow for appeals to the claims submitted.
4. The SIDTSI will analyze the appeals filed.
5. The SIDTSI will then forward to the Special Secretariat for Foreign Trade and International Affairs (SSFTA) lists with recommendations for deferrals or rejections of the applications, accompanied by technical opinions and the respective draft of ordinances to be published when the concession is granted.
6. SSFTA is responsible for the decision-making process of the Ex-Tariff concession applications.
7. The Executive Secretariat of CAMEX shall maintain, on the website of the Ministry of Economy, a complete listing of all the demands of concession of ex-tarifarios, whether granted or denied.