sexta-feira, 31 de maio de 2013


Just the other day I was posting about the attacks and criticism against arbitration in Brazil.

I mentioned that I was even considering forbidding my clients to arbitrate in Brazil.

Yesterday, I got new reasons to be concerned. A respected legal publication in Brazil has published two articles with severe criticism against arbitration in the capital markets.

I'm not sure if this means that the publication is only creating a buzz around the topic, or if this is a real legal trend developing in the Brazilian academia.

But I don't like to direction it is taking. I'm cautious.

You can check the stories here (in Portuguese):

Especialista critica arbitragem em mercado de capitais

Sigilo é obstáculo à formação jurisprudência arbitral

What do you think about it?

You may check part and part 1

quinta-feira, 30 de maio de 2013

Medical cares that should be taken before coming to Brazil

Here is another guest post by Ms. Gringa da Silva. Hope you enjoy it!

Hello my pretties, it's is me, Ms. Gringa,

Adler and I have been having scheduling issues, so the posting of a weekly column is somewhat skewed at the moment.

Fear not, however, Ms. Gringa is here to help you, always.

So, this week’s post is about health care, hospitals, insurance and stuff like that.

Ms. Gringa has spent the last week running back and forth to the toilet with a nasty touch of Delhi Belly. What started out as an innocent night out and a lovely dinner, turned into a full blown mess which eventually led to going to the hospital. Fun.

Add to this, Ms. Gringa has not had caipirinha in more than a week.

Before you come to Brazil, you really do need to ensure that you go to the dentist, have your annual check-ups, get whatever vaccinations you need updated, or added and if needed collect a refill of your prescriptions, (carry your paper prescriptions with you, you might be asked to prove that the pills are for you and don't carry too many or someone may assume you are importing them for resale) favorite supplements, contact lens solution and so on.

Not because Brazil does not have adequate medical services or equivalents, but because you really don't want to be bothering with this stuff as soon as you land.

Remember, if you are bringing something that the customs declaration form wants you to declare, then declare it. No one gives a damn unless it is illegal, but paperwork is The King, so fill it out, for heaven’s sake. You could be turned away at the border for being inconvenient if you do not...

You will need Hepatitis A and B vaccines. You should get Yellow Fever, regardless of whatever the websites may tell you. Remembering that Border Control is always looking for a reason, so don't give them one. Make sure your Tetanus is up to date, and whatever that Jenny McCartney may have to say about it, also MMR if you did not get it as a child for some strange reason.

If you don't have a Polio vaccine, you are beyond help, so don't come to Brazil.

Unless you plan on being in some extremely undeveloped area, drinking untreated water and bathing in a polluted river, you do not need a Typhoid vaccine.

Malaria Prophylactics? It depends on where you will be going. Dengue Fever is far more prevalent and preventing bites is always desirable. The Malaria Prophylactics are available here by the way.

Unless you need to take them, don't. You might be taking medicine for no reason and allowing the spread of potentially drug resistant malaria to proliferate.

Children will be possibly required to show proof at the border of the basic childhood vaccines, but adults typically might be only required to show proof of Yellow Fever Vaccine.

All vaccines and medicines and procedures and mosquito repellents and life come with potential problems and side effects and issues, so remember to talk with your doctor, and also remember, Ms. Gringa da Silva and Adler Martins ARE NOT RESPONSIBLE for what you do or what happens to you if you do it, these words in this post are just suggestions, after all. Everyone hates legal disclaimers, but it is a litigious word and people tend to behave like spoiled children, versus adults responsible for their own actions, so they are needed.

Now, onwards. Get travel insurance before you come and get the complete package. Coming to Brazil and being in Brazil without insurance is about as smart as swimming in shark infested waters with a bacon bikini on.

If you are planning to be here a while, you will need private health insurance. To get this in the best way, it is good to get an insurance broker, who for a fee, will run the gauntlet of paperwork and red-tape and other nonsense for you. Inquire from your co-workers and Brazilian friends as to what provider and broker is the best one for your needs.

Word of mouth is a much better indicator of quality and reliability here than any other thing or advertisement.

The caveat is that Brazilian providers will not provide you with health insurance without CPF and RNE numbers. We will be going into great detail about how to obtain those things soon, I promise. (and the caipirinha scale will go up exponentially as we discuss them) In the meantime, make sure your travel and health insurance from your home country covers the time you will be in Brazil until such a time as you being able to get the relevant thing here.

Private hospitals in Brazil are great, but like everything else, they involve paperwork and are exacting in their methods. Deal with it. In a private hospital you can complain, but unless you are being kicked around, be an adult and deal with it like the Brazilians standing beside you do.

You will be able to obtain medical care of sorts here without private insurance, but it is not recommended and it may end up costing you a great deal of time and money, inconvenience and is not reliable. You won't be allowed to die or anything and your Embassy might help you in any case if it is serious.

The Brazilian Government provides a health care system called SUS: Ms. Gringa does not know much about it, just poorly understood second hand accounts from people who work for me, with me, or that I know. It is available to foreigners of course, but really, if you can afford to come here, you can afford travel insurance at least. I can’t stress this enough.

Adler will go into more detail about SUS in other posts on his blog.

Ms. Gringa needs to go back to bed now.

The above annoyances and inconveniences range from a 1 to a 2 on the caipirinha scale. Not having insurance in Brazil and needing it, will land you a 5 on the caipirinha scale, trust me.

We will return to our regularly scheduled bureaucracy discussions forthwith.

So, my pretties, until next time, yours in the spirit of cachaça,

Ms. Gringa da Silva

All rights reserved © 2013 by Ms. Gringa da Silva (

terça-feira, 28 de maio de 2013

Intellectual property and 'fair use' under Brazilian Law

See also:

Frequently I am asked by my clients on matters related to the protection of trademarks, brands, company names, software contracts and other issues of intellectual property in Brazil. Recently a client asked me about the so-called "fair use" in Brazil, and if he could make references to other brands in his product without permission of the owner.

Many of my clients are familiar with the concept of "fair use", but fact is that there is no express provision of this concept in the brazilian rules of intellectual property protection, although some laws that make indirect references to this concept.

For example, Brazil is a member of the TRIPS Agreement (Agreement on Trade-Related Aspects of Intellectual Property Rights), which provides that:

Article 17
Members may provide limited exceptions to the rights conferred by a trademark, such as fair use of descriptive terms, provided that such exceptions take account of the legitimate interests of the owner of the trademark and of third parties.

The protection of brands in Brazil is also regulated by National Act No. 9.279 of 1996, which says:

Article 132. The trademark holder may not:
IV - prevent the mention of the brand in speeches, scientific or literary or any other publication, as long as there are no commercial connotation and no damage to the brand's distinctive character.

The Brazilian copyright law (National Act No. 9.610 of 1998, article 46) and the Brazilian software law (National Act No. 9.609 of 1998, article 6) also have some rules that resemble the American concept of fair use, most of them related to the non-commercial, artistic or cultural use.

Thus, one can notice that, although that Brazilian law does not expressly stipulate the concept of "fair use", there are in Brazil a number of possibilities of use of trademarks or brand names without violation of intellectual property rights.

Is there any reader who works with IP and would like to contribute to the discussion?

See also:

quinta-feira, 23 de maio de 2013

May I switch jobs when under a working Visa in Brazil?

This is a conversation I had with a client about a relatively normal problem here: changing jobs while on a work visa.

Hi Adler, 

Tudo bem? 

I am looking for what is the process if a foreigner, who is currently working in Brazil on a work visa ITEM V, finds a job in a different company and wants to transfer the visa to the new company.

If you have an article about it that would be great.

And once more thanks and I appreciate your work to make business easier for foreigners in Brazil.


Scarlet Speedster

PS: please reply in flash speed. 


Dear Mr. Speedster,

The rules regarding working visa have been recently modified. 

According to the old rules, your current employer would need to be consulted. Also,  your current visa would be cancelled, and a new one would have to be issued, meaning that you would have to pick it up at the Brazilian consulate in your home country.

But you are lucky!

If you check the article Easier rules for work visas in Brazil, you will see that the new procedure is easier and faster than the previous one. Your new employer will have to contribute with some paperwork, and evens sign a few forms, but it is doable. Above all: your visa will not be cancelled, so you will not have to leave Brazil.

I do not advise you to actually change jobs before going through the new procedures. Some people do change jobs without consideration for the rules, but that is risky, illegal and may get you expelled from the country.

If you need any further information, please get in touch. 



terça-feira, 21 de maio de 2013

Electronic payments in Brazil - A telecom business, more than a bank one

Brazil  has just published a provisional measure (which has the force of a  bill) that regulates electronic payments in the country (link to the Portuguese text).

Brazilians already make heavy use of credit and debit cards. So, this is not the news.

What is new is that the new rules put electronic payment providers under the control supervision of the Brazilian Central Bank. Think of pay pal, bitcoin, small credit card companies, etc.

The credit card giants, such as Visa and Master Card, will also be subject to a higher degree of supervision. It is like they were integrated to the Brazilian bank system.

This has some benefits, such as a higher level of security, as well as disadvantages, such as more bureaucracy and elevation of costs.

The rules are very broad, and will depend heavily of further regulations to be issued by Brazilian Central Bank.

A central point, that many people might have overseen, is that electronic payment by cell phone have been clearly described as a joint responsibility of the Brazilian Central Bank and the Brazilian Telecom Agency (Anatel).

So, I will probably be posting about a joint rule to be issued by Anatel and the Central Bank very soon.

A curious fact: I have been receiving calls from providers of electronic payments software since last year. Probably, the telecom operators already knew about the new rules and started asking for proposals abroad.

They were well informed! The rules are finally here.

If you also want to sell your payment software in Brazil, I'd recommend you to read about taxation of software in Brazil.

What do you think about it?

segunda-feira, 20 de maio de 2013

How to send profits from Brazil to Europe

See also: 

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.

No to purchase of land by foreigners. Uruguay joins Brazilian sad club

Sometimes, you only need to observe the supporters of an idea to know whether or not it is a good one.

Take restrictions on land purchase by foreigners. It is ardently supported by the noble group of Venezuela, Argentina and Brazil.

Uruguay, which, otherwise, seemed a nice place, now joins this sad sad camarilla.

I hate such restrictions. I have written about it on many occasions:

Brazil and Argentina have restricted land acquisition by foreigners

Unconstitutional regulation in Brazil

To think I was contemplating buying a second home in Uruguay....

Mr. Mujica, I have a steeled soul, hardened by all the government injustice I must bear, being a lawyer in the 3rd world.

Still, you broke my heart. 

sexta-feira, 17 de maio de 2013

Easier rules for work visas in Brazil

You may also want to see:

What changes:

1) Documents must be presented mainly electronically.
2) Most of translations (e.g. diplomas, graduation certificates) can be presented after the visa is required, and not before;
3) Foreigners may switch jobs while in Brazil in a much easier way. The visa is not cancelled when the worker change jobs, but automatically renewed.
4) Postgraduation students can come to Brazil in order to work during their vacation time (up to 90 days a year)

It is also expected that the analysis will be made much faster. 

Please notice that part of the old regulations still apply. The gates are still closed to workers without qualification and a Brazilian company must sponsor the visa request. 

The visa still has to be obtained before you come to Brazil!

Nevertheless, a change for the better. 

quinta-feira, 16 de maio de 2013

Capital gains tax in Brazil – what foreign companies should know

See also:

I recently received a question from one of my blog readers in the UK, concerning capital gains tax in Brazil. His question was as follows:

Dear Adler, I’m looking to setup a company here to buy assets with funds from UK investors. I assume the Brazilian company would be subject to Brazilian capital gains tax. Would UK investors be subject to UK capital gains tax also?


Dear Mr. Amazo,

Thanks for the message. 

I have recently been working with quite a few investors from UK and The Netherlands with similar business strategies. 

There are two sets of tax structures that may apply to your case:

(1) If you set up a Brazilian Company and invest through it, you will pay taxes as a Brazilian company. But, after taxation, the gains can be sent back to the UK without profits remittance tax. When the original capital is to be sent back, you may have to pay taxes on the currency appreciation.

(2) If you invest as a foreign company, directly in the stock market, the taxation may vary from 0% (in case of federal bonds) to 25% (day trade and some investment funds). In this case you do not have to set up a company in Brazil, but will have to hire a bank or broker here, who will represent you. 

In both cases, the taxation in the UK is independent from the taxation in Brazil, and may apply.

The Brazilian Central Bank does not charge anything for the registration. The registration before it is only for regulatory purposes. All transferences and business are managed by private banks. 

I hope to hear more from you. 



See also:

quarta-feira, 15 de maio de 2013

Homosexual marriage made easier in Brazil

Note: Please check: Same sex marriage allowed in São Paulo. 

The National Council of Justice (CNJ) approved on the last 14th of May a resolution that orders notary public offices to convert stable unions between homosexual couples to a formal marriage, should the couple wish to do so.

Most homosexual couples used to formalized their union through a stable union agreement. Now, instead of having to marry in order to transform the civil union into a regular marriage, they can just convert the stable union, which is easier and faster.

The same goes for the validation of gay marriages celebrated abroad.

There is a risk of the measure being questioned before the Supreme Court. But, personally, I do not believe it will happen.

Note: Please check: Same sex marriage allowed in São Paulo. 

Quick Data on Bankruptcy and Tax Free areas

(Feel free to send me more questions, I will try to answer them the best way I can)

Q: Are you aware if Brazil has any "bonded tax-free areas" like Shanghai Waigaoqiao? thanks

Comment: Brazil has a few "Zonas francas", which have considerably lower taxation, such as the Zona Franca de Manaus, in the Amazon Forest. 

In addition to that, Brazil has some tax benefit zones, such as a big one in the Northeasth, where taxation is generally lower. 

Finally, Brazil also has some other tax benefits for parts and raw materials that are imported, industrialized here and then reexported.

Q: Can you provide an overview of the bankruptcy process in Brazil? If so, please briefly elaborate on how your background enables you to discuss this topic.

Comment: Yes. The bankruptcy process in Brazil is relatively fair, by which I mean it is more favorable to the debtors, but not absolutely.

However, government credits, employee’s credits and credits secured by mortgages have clear preferences over commercial debts. 

Thus, big companies seldom pay more than 20% of its outstanding debts to ordinary creditors after the liquidation procedure.  

See also:

domingo, 5 de maio de 2013

Singapore and Brazil sign MOU on intellectual property cooperation

Singapore and Brazil have taken steps to strengthen intellectual property (IP) cooperation in the next five years.

Under the agreement, parties will explore activities that encourage exchange of information, best practices and knowledge on various IP-related issues.
IPOS said when implemented, businesses of both countries can benefit from expedited patent registration, and greater sharing of IP business best practices for small and medium enterprises (SMEs) through joint participation of IP conferences and events.
Chief executive of IPOS, BG (NS) Tan Yih San said: "Singapore business owners will benefit from the network of South American markets, and have more direct access to the business opportunities in Brazil."
The MOU was signed at the INPI in Brazil on Sunday. 

sábado, 4 de maio de 2013

Exemption of import tax for machinery - Import permits for electronics and drugs

Note: You may also want to see How to calculate Brazilian Import Costs.

A couple months ago, I have been invited by the American Chamber of Commerce to present a panel on the most frequent problems regarding import procedures. 

The panel was very busy, as the audience contributed with lots of questions. 

I was trying to reproduce the whole event in a post, but I decided to list only the main topics. Here we go 

EX-Tarifário (Exemption of import taxes)

Advanced machinery that is not produced in Brazil and that can be considered a capital investment (microchips assembly lines are OK, the new Google glasses are not) may be imported with a substantial reduction of the Import Tax. 
I really meant the Import Tax, called II. Other taxes applicable over imports will still be applicable. 

WOW, tax breaks? Where do I sign?

Ex-tarifário is used very little in Brazil. Extremely little, I would say, considering that our industrial sector is far from the technological edge. 
One of the reasons is that it is not an automatic exemption, but rather a specific concession that must be granted by the government upon request of the importer. 
During the lecture, the other panelists and I have criticized this system a lot. Mainly because it takes a lot of time to obtain an exemption. Usually 6 to 12 months. 
This is because the procedures involve consultations with Brazilian producers, in order to confirm if the goods do not have a Brazilian similar one (Brazilian producers tend to be very broad on their interpretation of similar).

The States in Brazil can also grant tax exemptions for special machinery. Since the state VAT is one of the heavier taxes applicable over any import, this benefit should be pursued  by all importers. 

Temporary imports

Construction machinery, planes and other equipment may be imported on a temporary basis, with partial payment of import taxes. 
This kind of import also requires previous approval, that usually demands 3 months to be granted. 
Some companies will make a temporary import while the request for tax exemption is being processed. 

Regulatory Agencies and import permits, 
Many products need previous approval before being imported into Brazil. In some cases, the approval must be obtained before the goods are shipped abroad. 

For example: 
Medicines, cosmetics and food products must be previously approved by ANVISA; 
Electronic products, including cell phones and wireless devices, must be approved by ANATEL
Several consumer products, like toys, helments and condoms must be approved by INMETRO. 

Many exporters and even Brazilian companies do not know about it, and incur great losses when the goods are retained by customs. 

Please note that only Brazilian residents or Brazilian companies can handle the agencies' approval and the importation procedures, including the licensing of special products. 

This means that you must either assign a Brazilian partner to take care of the import licensing and customs clearance in your place, or you must incorporate a Brazilian company in order to do it yourself.

Of course, you can also sell directly to a local buyer. In this case, the local buyer must take care of the import procedures.

Approval procedures from the agencies mentioned above vary immensely. Some products need only be registered, while other (specially electronics and medicines) need to go through expensive tests. 

I will write more about it later.  


I have written before about how Brazil was in the right way regarding arbitration. This post it to take that back.

I'm not recommending Brazil as a venue for arbitration anymore. At least not until some very sensitive issues are solved.

Here is the story:

In February, the Brazilian Revenue Service (which I will call Beast from now on) has contacted many arbitration chambers, asking them for information about the fees their arbitrators were receiving. I read the news at the time (I read everything related to Brazilian taxes compulsively, as the old readers already now), but didn't pay too much attention.

The Beast has the right to ask for commercial information, of course. Arbitration chambers are organized as foundations, associations or companies, all of which must keep financial books, collect labor taxes over what the pay their employees, etc. So, nothing wrong about asking to check the chamber's own books.

But the Beast has required a full copy of all the arbitration procedures, evidences and confidential documents included !

You know what that means? It means delivering your computer codes, commercial plans and, theoretically, even the Coca Cola Formula to some government employee. 

Not to mention that the Revenue Service employs several law interns, who usually are 18 or 19-year-olds and who have full access to all the data and procedures.

Why would they do that?

1) The Beast is afraid that arbitration will turn out to be big money laundering and tax evading schemes;
2) Brazilian government's "zeitgeist" is that professional secrecy, specially regarding lawyers, it getting in the way of tax collection (if destroying professional secrecy is against the constitution does not seem to bother them)
3) The Beast has noticed that many arbitration procedures are not conducted by lawyers, and, therefore, are easier to break in, since other professions are not as well protected regarding confidentiality (one should note that the chambers managed by the Bar Association have not suffered any attack)
4) The Beast wants to use the information it acquires from the arbitration procedures, specially regarding corporate structures, offshore subsidiaries, etc to plan raids and investigations against big companies.

And can they do it?

It depends.

If there is no lawyer involved in the arbitration, the Revenue Service could, theoretically, ask for the documents that are strictly necessary in order to assess how much the arbitrators have been paid, and how much the chamber has received in fees. A previous agreement or some excerpts of the final decision should suffice.

But I understand that full disclosure is way out of their powers, and completely illegal.

How to prevent it?

1) Do not arbitrate in Brazil;
2) If arbitration in Brazil is mandatory for some reason, use the Bar Association arbitration chambers, and use only (or mostly) lawyers as arbitrators;
3) Add an obligation to destroy the arbitration procedure's records.

I'm very sad, but I'm serious.

What do you think about that?

You may check part and part 2.