Brazilian law allows, under certain conditions expressly provided by law, that foreign investors, whether individuals or legal entities, hold participation in Brazilian companies. The foreign investor may even be the sole partner of a Brazilian company.
Thus, for foreign entities and individuals to participate in a Brazilian company, they must first register with the Federal Revenue of Brazil and obtain a tax identification number called “CPF” for individuals, and “CNPJ” for legal entities.
To obtain a CPF or CNPJ, the foreign investor must appoint an attorney-in-fact who must be a resident in Brazil and registered with the CPF. This attorney-in-fact may be a native Brazilian, a naturalized Brazilian, or a foreigner with permanent residence in Brazil. In any case, the investor must grant the attorney-in-fact powers to at least: (i) represent them as a partner in the Brazilian company in which they will hold a share; (ii) represent them before various public authorities, especially and necessarily before the Federal Revenue of Brazil, as this attorney-in-fact will be responsible for paying any taxes owed by the investor in Brazil; (iii) represent them before the Central Bank of Brazil for investment registration; (iv) receive legal notifications; and (v) manage all of the investor’s assets and rights in Brazil, as expressly required by the rules of the Federal Revenue of Brazil.
To obtain the CPF or CNPJ, register with the Central Bank of Brazil, and for the foreign investor to enter the corporate structure of a Brazilian company, certain personal documents must be immediately presented to Brazilian authorities (without prejudice to others that may be requested in specific situations), such as: official identification documents of the individual or corporate documents of the legal entity containing the entity’s name, location of its headquarters, and identification of its partners and administrators; and the official identification document of the foreign legal entity’s administrator who will sign the power of attorney granted as mentioned above. For these documents to be valid in Brazil, all foreign documents must be notarized, legalized/consularized or apostilled (if the country of origin is also part of the Hague Convention), translated by a sworn translator, and filed with a Brazilian Registry of Titles and Documents.
Although the procedures described here are relatively simple, foreign investors should pay attention to Brazilian tax legislation and, if necessary, request specific legal advice on this matter, as Brazilian tax rules can be quite complex in some cases.
Finally, it is worth mentioning that Brazilian companies must be managed by one or more individuals who are residents in Brazil and are either native Brazilians, naturalized citizens, or foreigners with permanent residency in Brazil. Thus, the attorney-in-fact of a foreign partner, meeting the above requirements, can lawfully hold the position of manager in the Brazilian company.
