Setting Up Your Local Operating Company In Brazil

By Author: michaelsiebeo
Total Articles: 1
Comment this article

I have set up local operating companies in Brazil for a major multi-national company and for my own trade portal (B2Brazil), so I have had experiences at each extreme -- one with an "unlimited" checkbook and one with "tight" budget. In all cases, I can tell you that you need to be patient and expect to spend some money and to hire local service providers. Brazil is one of the future bright stars in the global economy so focus on the prize, and you must stay focused and patient when you go through this experience and others along the way which may frustrate and delay you.

In the United States, it can take as little as a few hours and not more than 2 days, to set up a company, obtain a Federal Tax ID number and open a bank account. As an NY and DC bar attorney, I do these pretty frequently for myself. But, you do not have to be a lawyer to set up a company in the U.S. If you learn the ins and outs of a relatively simple process, you can do it yourself at a very nominal cost. The opposite is true for opening a company in Brazil. You must rely on third party providers to assist you in organizing your local company.

In ...
... Brazil, it can take weeks and sometimes several months to set up a company, obtain a Federal Tax I.D. number (called the CNPJ) and open a bank account. You must also hire an accountant and a lawyer to manage the process, and they are not inexpensive, especially for foreigners. You must proceed step by step. And you will spend thousands of Brazilian Reais.

First, you need to set up the company. A lawyer or an accountant can do this for you. They will create articles of organization and file them with the requisite government entity(s) to establish the company. Prior to establishing the company, you should get advice on the most efficient means to minimize taxes, usually setting up a foreign company as owner of the Brazilian operating company. This can take weeks to establish because you will need documents legalised and certified and wait on approvals. To find a lawyer using B2Brazil, click here. To find an accountant using B2Brazil, click here.

Second, you need to obtain the CNPJ. You will need an accountant to do this. Again, you will need documents legalised and certified and wait on approvals. This will also take weeks to obtain.

Third, after you set up the company and then obtain the CNPJ, you can set up your bank account. You will deal directly with the Brazilian bank of your choosing. Banks in Brazil are very sophisticated and the major ones are technologically and operationally first-rate. You need to find a branch that you feel comfortable with. It can take days and weeks to set up the account and fund it because the bank needs to follow rules imposed by the Central Bank to open and then receive foreign funds.

Now you can start doing business in Brazil and with the Big 3 out of the way, you can do the following (and can use B2Brazil to help you find resources):
(1) Protect your trademarks and patents,
(2) Start hiring employees (you will need human resources advice),
(3) Look for office or production space,
(4) Obtain VISAs for your expat employees,
(5) Find marketing firms,
and so forth.

B2Brazil located at www.b2brazil is a great source for doing business in Brazil...

The author owns and operates B2Brazil, a B2B marketplace promoting trade and transactions with Brazil, located at www.b2brazil.com. To find Brazilian companies to partner with or for more information about doing business in Brazil, visit B2Brazil. Visit us: http://www.b2brazil.com .