Most Common Types of Companies in Brazil

If you’re interested in starting a business in Brazil it is important to first decide on the right type of company and legal structure, according to your needs and goals. This is important to also have into consideration the size of the business, benefits, but also limits. Learn about the most common types of companies in Brazil, their advantages, and how to register them!

Brazil is one of the most interesting countries in South America for investors and business owners from all around the world. Its diverse and inclusive culture as well as natural resources make it perfect for people looking to expand their horizons and try new industries. The first thing to remember is to always investigate and understand the market and how businesses operate, as well as what are the challenges and requirements.

What are the most common types of companies in Brazil? How to incorporate a company in Brazil? What are the requirements? How to decide on the best type of legal structure for my business?

Limited Liability Company or ‘Limitada’ (Ltda.)

LLCs or ‘Limitada’ is probably the most common type of company in Brazil because of their flexibility and security. The shareholders have limited liability and the shares can be transferred with no problem.

• A Limited Liability Company in Brazil requires a minimum of 2 shareholders that can be either foreign or local
• There is no minimum Share Capital required at the moment of incorporation
• The Shareholders are only responsible for their contribution to the Share Capital of the company

Corporation or ‘Sociedade Anônima’ (S.A.)

Although Corporations are not as common in Brazil this is usually the type of company big businesses choose because of their access to the stock market. It can have as many shareholders as desired and the shares can be transferred, inherited, or sold, as stipulated in the Articles of Incorporation.

• The minimum Share Capital required for a Corporation is equivalent to 10% of the value of the stocks
• For the formation, it needs at least 2 shareholders
• Corporations are required to have a Board of Directors and an Administrative Council
• An S.A. can be either open for public trade (‘Sociedade por Ações Aberta’) or closed (‘Sociedade por Ações Fechada’). This has to be specified in the Articles of Incorporation.

‘Empresa Individual de Responsabilidade Limitada’ (EIRELI)

EIRELI is the best option for small business owners or entrepreneurs that are just starting. It is similar to an LLC, and the incorporation process is simple. However, there is a minimum Share Capital required at the beginning of the process.

• It only requires one shareholder, who has to be Brazilian or a foreigner with permanent residency in Brazil.
• This shareholder will have limited liability over the complete Share Capital
• The minimum Share Capital required for this type of company is the equivalent of 100 Brazilian Minimum Wages. As of 2022, the Minimum Wage in Brazil is R$(BRL) 1,212, or around USD$ 232.
• It is only possible to own and be a shareholder of one EIRELI at a time. However, the same person can also be part of other companies with different legal structures.

Foreign Branch Office

• A Foreign Branch Office in Brazil has to have the same name as the main company
• A Legal Representative is required. It can be appointed to a national or foreigner with permanent residency in Brazil
• Some documents from the main company are required like Articles of Incorporation, a list of Shareholders, etc.

How to Register a Company in Brazil?

These are the steps you need to follow to register a company in Brazil. Some of these may vary depending on the shareholders, type of company, and business activities carried out.

1. Decide on the right type of company for your business in Brazil
2. Appoint a Legal Representative in Brazil
3. Submit the Articles of Incorporation to the State Board of Commerce
4. Visit the Federal Revenue Bureau to obtain a taxpayer ID or CNPJ (Cadastro Nacional de Pessoa Jurídica)
5. Register the CNPJ at the Brazilian Central Bank
6. Register the company at the local Municipality to obtain all necessary licenses
7. Open a corporate bank account

Get Assistance from Easyco Experts!

Brazil is the perfect country for your company incorporation! To make sure you register your company in the right way, you can get in touch with us, and our team of experts will ensure your business registration process complies with all Brazilian laws and regulations.

At Easyco, we make company formation in Brazil easy; our corporate experts have vast experience helping companies and individuals register their business in Brazil, with a proven track record of success across all of our services. Easyco aims to tackle the complex company formation processes across LATAM. We make business registration easy by providing a hassle-free online company registration experience. Start your company in Brazil today!

Furthermore, Easyco also provides additional services to guarantee your company’s compliance, which includes:

• Appointment of legal representation,
• Providing a registered office address
• Handling tax and accounting
• Hassle-free Payroll Services
• Manage your Company bank account opening
• Manage your Trademark Registration
• Recruiting and Hiring Talent
• Corporate Legal Services.