When will Brazil regain the investment grade?

This report from Novus Capital, an investment management firm, shows that, by 2027, Brazil may reach an acceptable debt to GDP ratio for purposes of receiving investment grade, provided that the government does a very good job on the management of the budget. 

In a less than optimistic scenario, the goal of a maximum of 63% of debt to GDP would only be reached by 2040. 

The findings are similar to the reports issued by the Brazilian Central Bank on the matter. 

Although the findings are not stelar, they are positive. The study shows that the country may stabilize and improve its finances without much effort, just by not increasing expenses. 

The cabinet is very much willing to speed up this kind of good news. I would bet that, before long, Brazil will receive at least an update in its rating. 

You can download the full report (in Portuguese) here. 

Getting money into your Brazilian company - a few common problems

See also: 

Incorporating a Brazilian company, step by step

I have spent the last week struggling with Brazilian banks in order to get ahold of some investments/loans that my clients wired from abroad.

I often receive complaints from the readers, saying that "Brazilian banks have retained their money", or that "It is impossible to get money into Brazil".  More than one have asked me what would be the penalty for bringing the money in a bag (or in a car). They always ask about this last one in a theoretical way, but I sometimes sense that it has gotten way over platonic contemplation.

I know my way around the system, for sure. But, even for me, this kind of operation is always stressful. Everybody in the firms gets double coffee on money week.

The path, in theory, is not so difficult. Basically:

International Bank Account Number (IBAN) - Sending money to Brazil

See also:

-Financial investments by non-resident in the Brazilian financial and capital markets

- Getting money into your Brazilian company - a few common problems

- How to get cash back from Brazil to Europe

List of documents for setting up a company in Brazil

Power of Attorney for setting up a company in Brazil

Brazilian banks always give foreigners a hard time when it comes to international transfers.


I mean, a really hard time. It is not unusual to wait up to two weeks before a wire transfer from the UK is available to a Brazilian account holder. And, when it is finally available, the bank will usually require a long list  of documents before clearing the funds.

Until last week, Brazilian banks did not use IBAN (short for International Bank Account Number). Only swift codes.

This was awkward, of course, because European banks adopt IBAN. The mismatch was inevitable.

Starting this month, Brazilian banks are forced to accept and provide IBAN identification to their clients. I hope this makes things easier for everybody.

The rule is here, in Portuguese.


You might also want to read:

Getting money into your Brazilian company - a few common problems

Opening a Brazilian Bank account for non-residents

A cool Brazilian blog: Brazilphenomenon (brings details about swift and IBAN)

How to send profits from Brazil to Europe

See also: 

Incorporating a Brazilian company, step by step

Getting money into your Brazilian company - a few common problems

Capital gains tax in Brazil  – what foreign companies should know

This post cover the remittance of profits that have been obtained by a Brazilian company with foreign shareholders.

Foreign investments in Brazil are subject to registration with the Central Bank of Brazil (BACEN), and the information the investor provides becomes part of the Information System of the Central Bank (SISBACEN). This registry is a key requirement, without which the investor cannot remit the profits obtained in his operations in Brazil abroad, repatriate the capital or reinvest the profits.

After Law n. 9.249/2005, the profits earned and distributed from 01/01/1996 became exempt from income tax as well as from the supplementary income tax in Brazil. 

Therefore,  remittance of dividends abroad is exempt from income tax.

Dividends repatriation is allowed, at any time and without any kind of government authorization, as long as the balance sheet of the company is duly registered and the amount remitted is equivalent to the amount declared in the balance.

The financial institution managing the FX agreement may ask for a record of the shareholder`s meeting that decided upon the distribution of profits. This is due to compliance rules. Depending of the compliance analyst, it may accept a simple signed form, or it may request the records to the filed with the Commercial Registry. In this last case, the transaction may be delayed for one or two weeks.

See also: 

Incorporating a Brazilian company, step by step
Getting money into your Brazilian company - a few common problems

Capital gains tax in Brazil  – what foreign companies should know

How to register with Banco central money coming from a personal account abroad into a Brazilian business account? I've read that the Brazilian company receiving the money needs to be registered

Well, this is fairly bureaucratic.  First, the investment must be filed before the local Commercial Registry

Then, the foreign investor, usually through a Brazilian with Power of Attorney, must go to the Brazilian Central Bank to obtain a login and password that will enable it to access the Sisbacen electronic System.

After that, the investor must register the investment in the Sisbacen System, on the exact terms filed before the Commercial Registry.

 Also, I must say that the Sisbacen interface is not easy to operate (it is a DOS based system)

This is part of what I do on a daily basis as a lawyer/consultant. I'd strongly advise you to look for professional help.

You may find more information at my blogs: www.brazilianlawblog.com and www.adlerweb.blogspot.com.

Adler Martins

Note: Extracted from a Linkedin  Conversation

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