international business attorneys

faqs

As Brazil continues to grow, more U.S. companies are planning to enter that market or expand their presence. What are the main legal aspects companies should be aware of?

When it comes to do business overseas, it is always important to learn the basic legal aspects of the country. Brazil has a fairly well structured legal system that has evolved over the years and continues to adapt itself to the modern needs and legal environments.

Although each industry has its own particular legal requirements and important aspects to be concerned with, generally speaking labor, tax and IP are the most common concerns for a new comer in Brazil. But it really depends on the industry and the business itself, as every case is an unique case. For example, an investor acquiring real estate in Brazil for the purpose of renting or leasing may not be too preoccupied with labor or IP issues, while his eyes will be focused on Environmental related situations or, as most recently raised, ownership related discussions.

No matter what industry though, probably the most critical legal issue to be aware of is the fact that the judicial system in Brazil is usually ineffective due to a myriad of appeals and legal tools as well as an overwhelming volume of cases each judge has to deal with, which causes a very painful, long litigation process.

How easy is to hire employees in Brazil?

It depends on the type of business organization one chooses, as well as the specific requirements of the industry; time for launching may vary from a week to months. Incorporating in Brazil is usually not an issue and most States have reasonable turn around at their “Juntas Comerciais”, a corporations register office similar to the Secretary of State’s Corporations Department here in the US.

The most common delay problems come from specific permits, licenses and authorizations needed to operate the business in Brazil. From Brazilian Central Bank requirements to city permits, the process can cost many months and it is advisable to seek appropriate legal assistance early on. Cost of launching will also depend on where the business will be located, but the initial legal cost of incorporating is not significant.

What is the average time and cost of launching a business in Brazil?

Here is another good example of it depends answer. Depending on the type of business organization one chooses, as well as the specific requirements of the industry, time for launching may vary from a week to months. Incorporating in Brazil is usually not an issue and most States have reasonable turn around at their “Juntas Comerciais”, a corporations register office similar to the Secretary of State’s Corporations Department here in the US.

The most common delay problems come from specific permits, licenses and authorizations needed to operate the business in Brazil. From Brazilian Central Bank requirements to city permits, the process can cost many months and it is advisable to seek appropriate legal assistance early on. Cost of launching will also depend on where the business will be located, but the initial legal cost of incorporating is not significant.

Can foreign companies own land in Brazil?

This is an ongoing discussion in Brazil. At this point, as it has been for years, there were no impediments only certain limitations on land acquisition by foreigners in Brazil, mainly on certain areas and under certain circumstances. However, recently discussions have emerged due to the significant amount of land acquisition by foreigners that have occurred lately. The key argument here seems to be sovereignty. The Brazilian Congress is exactly debating whether they would impose limits, forbid or allow the acquisitions to continue. There is even a chance that they would revert previous acquisitions by foreigners, even though this seems to be have a slight chance to be chosen.

The debate was recently heated when a decision by the CNJ (National Justice Council) in July declared that companies controlled by foreigners are allowed to own rural land in Brazil. However, because this is a year of elections in Brazil, the likelihood of having this issue settled is reduced.