Luciano Costa and Maria Eugênia Patara, based on recent experiences supporting foreign companies in setting up their operations in Brazil, have a few tips on dealing with our globally-known bureaucracy:
– Incorporating a company in major cities like São Paulo and Rio is much easier these days. With the pandemic, a lot of digital solutions have been implemented. However, be prepared for some inconsistency in rules among different states and, sometimes, even different interpretations within the same Commercial Board. What to do? Be conservative and double-check everything.
– Foreign documents still must be apostilled (also notarized for countries not part of the Hague Apostille Convention) and sworn translated in most cases. No major advance here, so include some days or weeks in any timeline for that.
– Choose wisely your local accounting firm. There is a vast number of accounting firms in Brazil, they are usually ok, but few of them are really capable of communicating in English. If you need that, you will pay a premium and it is money well invested.
– Should you need a local individual to act as representative of the foreign company and/or manager of your local entity, there are firms (including accounting firms) which provide that service. But consider that this is a risky position to be assumed, so expect this arrangement to be temporary and, sometimes, expensive.
– Taxation is a mess and will continue to be for the foreseeable future. Particularly if you operate in the digital, fintech or any other new, innovative space. What to do? Get trustworthy advice and be patient.
– The sooner you have your local team on board, the better you will be capable of overcoming the hurdles and envisaging the opportunities that brought your company here in the first place.
– An optimistic final tone: despite all the bureaucracy, tax complexity, and political turmoil, Brazil has strong institutions, competent regulators, and an independent Judiciary. Government and people are generally friendly and open to new businesses and ventures. In the long term, that makes a difference in the success of any enterprise.