1 – Legal representation
The first step to stablish a subsidiary of the foreign company in Brazil is to grant powers to an attorney in fact for “company law and tax purposes”. The future attorney in fact has to be Brazilian, denizen, or hold a permanent visa and be resident in Brazil as well as have tax residence. From this moment on, he/she will be responsible for the interests of the foreign company as shareholder of the Brazilian company. The attorney in fact, with powers to receive summons and subpoenas from courts and/or tax tribunals, will be responsible vis-à-vis the Brazilian official authorities.
It is also necessary to appoint and administrator of officer to the Brazilian company. This administrator shall not be prevented by the law or convicted, which will prevent him/her from, even if temporarily, to accede to be a civil servant, or convicted from bankruptcy crime, malfeasance, bribery, graft, embezzlement, or against the national finance system, against the rules of concurrence, consumer relations, or crime against welfare public faith or property.
2 – Articles of association
The second step, after appointing the legal representative, is to draft the articles of association. In this document the local or foreign shareholders shall be nominee, the company’s name, the corporate purpose, the headquarter address, the capital, administration, directors, corporate governance, amongst others. At this point, it is important to rely on the support of an attorney for the drafting of the terms. PLBrasil can refer lawyers that suit your needs.
3 – Enrollment at the Government bodies
At this point, the constitution of a new company will be under federal, state and municipal levels. In order to operate legally and according to the corporate purpose, it is necessary to obtain beforehand permits, in some cases before filing the articles of association at the Board of Trade of the State in which the company will be set up. When the Articles of Association are dully filed, one shall move to the federal level, in order to obtain the Legal Entity Tax Identification Number (CNPJ), which will allow the payment of the taxes and obligations to the Federal Revenue Office.
It is also necessary to start analyzing the documentation from the municipality and State (as for the State Treasury Office), in case the corporate purpose is for industry, commerce or transportatio
4 – Registration at the Brazilian Central Bank
In order to the foreign shareholder be able to invest or loan money to the Brazilian subsidiary, electronic registers in the Brazilian Central Bank system are necessary, which will allow the inbound of foreign capital, being considered long term capital and/or foreign loan. The Law 4.131/62, which allows foreign investment, grants equal treatment to the foreign capital in Brazil, and set deadlines for the statement to be sent to the Brazilian Central Bank about the foreign capital invested in Brazil. The register of the foreign capital at the Electronic Declaratory Register (RDE) allow the return of the invested capital overseas, fast and without any need of authorization beforehand.
At this point, the Brazilian company must be about to open a bank account in Brazil, in order to allow exchange contracts and receiving of remittances.
5 – Accounting and Human Resources
When the Brazilian company is dully incorporated and enrolled at the government bodies, accounting and human resources services must be set up, for such areas are fundamental for taxing purposes according to labor and social security laws.
In case you intend not to overspend in these areas, we can recommend companies of our trust specialized in Business Process Outsourcing.
6 – Contracts, clients and signatures
After all the steps above described were taken, and the company is dully incorporated, PLBrasil will be able to answer your demands as for signing documents, represent in meeting and intermediating the interests of the foreign company in the Brazilian Market.