Doing business

Brazil

Print the page Click to print the page

Setting up a company | FDI in figures | Why you should choose to invest | Procedures relative to foreign investment | Finding assistance for further information

Setting up a company

Types of companies and capital (max/min)	Number of partners/shareholders and liability
La Sociedade a responsabilidade limitada is a limited liability company . No minimum capital.	2 partners minimum. Their liability is limited to the amount of capital contributed. They are also jointly liable for the company's commitments within the limit of the capital remaining to be paid up.
La Sociedade anonima is a public limited company. No minimum capital. NB: 10% minimum of the issue price of the subscribed shares must be paid up in cash.	2 partners minimum. The partners' liability is limited to the amount of capital contributed.
The general partnership. No minimum capital.	n.c. Their liability is joint and indefinite.
The limited joint-stock partnership. No minimum capital.	There are two types of partners, the active partners and the silent partners. The liability of the active partners is unlimited. The liability of the silent partners is limited to the amount of capital contributed as long as they do not participate in the management of the company.

Business setup procedures

Setting up a company	Brazil	Latin America & Caribbean
Procedures (number)	15.0	9.3
Time (days)	120.0	56.7

Source: Doing Business.

For further information: Consult Doing Business Website, to know about procedures to start a Business in Brazil.
Register of commerce
Civil Register of legal entities
The competent organization: All necessary information is on the SEBRAE website. It is also possible to make an application for registration by Internet. It is advisable to call on a lawyer for assistance.

FDI in figures

Foreign Direct Investment	2008	2009	2010
FDI inward flow (millions USD)	45,058	25,949	48,438
FDI stock (millions USD)	287,696.9	400,807.7	472,578.5
Performance Index*, ranking on 141 economies	90	87	-
Potential Index**, ranking on 141 economies	67	-	-
Number of Greenfield investments***	250	271	-
FDI inwards (in % of GFCF****)	14.7	41.5	-
FDI stock (in % of GDP)	17.6	25.5	-

Source:

Note: * The UNCTAD Inward FDI Performance index is based on a ratio of the country's share in global FDI inflows and its share in global GDP. ** The UNCTAD Inward FDI Potential index is based on 12 economic and structural variables such as GDP, foreign trade, FDI, infrastructures, energy use, R&D, education, country risk. *** Green field investments are a form of foreign direct investment where a parent company starts a new venture in a foreign country by constructing new operational facilities from the ground up. **** Gross fixed capital formation (GFCF) measures the value of additions to fixed assets purchased by business, government and households less disposals of fixed assets sold off or scrapped.

Why you should choose to invest Brazil

Strong points: Brazil has Universities that perform just as well as their counterparts in the OECD and a very big manpower reserve educated to all levels. It also has extensive raw material resources. A number of sectors offer good business opportunities. The Brazilian economy is diversified and more and more manufactured goods are produced and exported. The potential of the Brazilian domestic market as well as the low cost of labor are elements which may attract foreign investors.
Weak points: Despite being open to world trade, several administrative barriers cripple international trade. Valuing the real against the dollar automatically reduces the country's competitiveness against Asian competitors in some sectors. The Labor laws are very onerous, involving substantial costs to foreign companies and keeping a good part of the local business in the informal sector.
Government measures to motivate or restrict FDI: The Brazilian government encourages and promotes FDI. Most of the barriers to foreign investor activity have been removed particularly on the stock market. A very large number of public companies have been privatized and many sectors deregulated over the last fifteen years.
Bilateral investment conventions signed by Brazil: Brazil has signed bilateral agreements for the protection of foreign investment with 14 countries, but 7 of them have not been ratified by the Congress.
To see the list of countries, click here.
To see the conventions, click here.

Procedures relative to foreign investment

Freedom of establishment: Guaranteed.
Acquisition of holdings: The investment regime in Brazil is a liberal regime which allows foreign investors to have a majority share in the creation of their company.
Obligation to declare: The agency for the promotion of foreign investment in the country gives information about the authorizations necessary for setting up. All inflows of capital must be declared to the Central Bank.
Competent organization for the declaration: Central Bank of Brazil
Requests for specific authorizations: Foreign investment is restricted and requires special authorization in the nuclear, health, land ownership, fishing, post office, telegraphs, aviation, aeronautics, media communications and highway freight sectors.

Finding assistance for further information

Investment aid agency: BNDES
Agency for the promotion of investment in Brazil
FINAME
Other useful resources: Central Bank of Brazil