Brazil is a promising market for investors from all over the world. Therefore, the number of foreign companies setting up businesses in the country grows every day. But this process sometimes requires legal representative in Brazil of the participating partners and directors. 

Although the physical presence of entrepreneurs is not mandatory, it is essential that entrepreneurs have a representative with legal residency in Brazil. 

This certainly facilitates the opening of the company and decision-making regarding the new venture, especially with regard to fiscal and tax compliance. 

It should be note that the government authorities establish rules regarding the legal representation of foreign investors. Find out more about these standards in this Europartner article! 

Legal representation in Brazil of foreign shareholders

With some exceptions, the country allows several categories of companies to be wholly owned by a foreign shareholder. 

In this way, the country benefits from attracting new businesses and more investment to the economy. On the other hand, the investor maintains its autonomy, not depending on a Brazilian partner – a factor that could cause obstacles in the business formation.

However, even with the existing facilities, the need for a foreign shareholder to have a legal representative in Brazil is not ruled out. 

Once appointed, the representative – called “corporate and tax attorney” – will be the person in charge, and he or she can replace the foreign shareholder before the Brazilian tax authorities and the Central Bank.

Requirements to be a legal representative in Brazil

Brazilian legislation provides that the legal representative must meet the following requirements determined by the Federal Revenue Service of Brazil: 

• Be an individual, Brazilian or foreign.
• Maintain residence in Brazil.
• In the case of a foreign individual, it is essential that the representative has a permanent visa.

The conditions imposed, in fact, are intended to protect the tax authorities, since the legal representative is liable for non-compliance with tax obligations of the company incorporated in Brazil.

That is, the legal representative, residing in Brazil, has express powers to answer for the company. Thus, on behalf of the enterprise, it can also receive summons in lawsuits against it.

Appointment to the position of manager or officer.

Once a foreign company is incorporated in Brazil, the investing partners must appoint an individual residing in the country to be the company’s manager or officer. 

To this end, it is essential that the manager meets the following requirements: 

• The individual cannot be prevented by special law.
• It cannot be under conviction for a penalty that prevents access to public office – even temporarily.
• It cannot have been convicted of bankruptcy, bribery, malfeasance, embezzlement, concussion or against the popular economy.
• It cannot have committed and been convicted of crimes involving the national financial system, authority to attest documents or property, against competition defense rules, against property, among others. 

Before establishing a company in Brazil, know your corporate and tax obligations! 

Opening a company abroad always requires partners and legal representatives to comply with the requirements imposed by the authorities of each country. 

In Brazil, this is no different, especially since the country is known for being quite bureaucratic in business opening procedures. 

And when the agenda is representation by a person who is a legal resident in Brazil, it is healthy for investors to have trusted people and partners at the head of the business.

Likewise, get guidance on starting a business in Brazil with an experienced partner like Europartner. 

Our team of experts is able to offer guidance and assistance with all legal requirements, maintaining corporate compliance during the incorporation process. Contact us and let us be your company legal representative in Brazil!