Opening a business in Brazil
Why make it simple?
Setting up shop has just got easier. But not much
BRAZIL is not an easy place to start a business.
The World Bank ranks it 120th out of 183 countries—worse than Burkina Faso or Nigeria.
Take one small example.
Until recently, you needed at least two partners to form a limited-liability company.
Sole traders had to find a 1% sócio—an employee , friend or family member willing to lend his name to the articles of association , or a shell company set up solely to hold a tiny share.
Things may have just got a little easier.
A new law, which supposedly came into effect on January 9th, allows a lone business-owner to set up an Empresa Individual de Responsabilidade Limitada:
a single-holder limited-liability firm.
The main requirement is capital of 62,200 reais.
This is a big deal. Alas, it may not happen as planned.
In December the federal body that oversees state business registries told them to turn away firms trying to register Eirelis, as well as foreigners without permanent right of residence.
No reason was given.
Later, lawyers were briefed that the law's aim was to let Brazilian sole traders protect their personal goods against lawsuits or bankruptcy—not to make life easier for big business or foreigners.
Since the restrictions have no basis in the law, challenges are inevitable. Husam Abboud of Establish Brazil, a company-formation specialist, is thinking of Brazilian-style direct action: simply trying to register an Eireli for a firm or a foreigner, and seeing what happens.
由于这些限制在法律上没有渊源，因此不可避免地存在质疑。来自Establish Brazil的Husam Abboud ，是一位公司设立的专家，其指出巴西风格的直接效果：只是试图为公司或外国人注册一人有限公司，之后坐观成败。
We won't be trying just once, but many times, he says cheerfully.
In Brazil, it always depends who's on the desk on the day.
A few speedy locals have already set up Eirelis.
It was quick and easy, because I didn't have to hunt for a partner, says Taise Litholdo, an architect.
这样简单快捷，而无需寻找合伙人，建筑师 Taise Litholdo说道。
Sebastiao Lino da Silva, an accountant in Sao Paulo, is helping a medical-research firm, which recently lost a partner, to convert into an Eireli.
圣保罗的会计师Sebastiao Lino da Silva正协助一家失去合伙人的医药研发公司转为一人有限公司。
The remaining owner would otherwise have to find a new partner or close.
Joao Marcelo Pacheco of Pinheiro Neto Advogados, one of Brazil's largest law firms, says that some wealthy clients will use Eirelis to make their lives simpler.
来自巴西最大律所之一Joao Marcelo Pacheco的Pinheiro Neto Advogados称，某些重要客户打算运用Eirelis以令生意更顺遂。
All this amounts to a tweak, not a revolution.
By January 18th only 14 Eirelis had been registered with Sao Paulo's board of trade, Brazil's biggest.
The truth is Eirelis are not really suitable for most small businesses, says Mr Abboud. Few hot-dog vendors and hairdressers have enough spare cash to satisfy the capital requirement, he points out.
That is an argument for scrapping the capital requirement.
The Socialist People's Party, an opposition group, has asked the Supreme Court to rule it unconstitutional for discriminating against micro-traders.
Even if foreigners are allowed to set up Eirelis, breaking into Brazil will remain tough.
The biggest hurdle—finding a permanent resident willing to hold power of attorney for foreign owners—will remain.
Establish Brazil and its rivals will do this for foreign clients,
but only until a local manager has been appointed, or an expatriate has arrived on a permanent business visa.
The snag is that acting for a foreign firm leaves agents vulnerable to Brazil's capricious tax authorities and labour courts, which tend to ignore limited liability and pursue individual owners.
They want to be able to freeze someone's bank account if problems arise, explains Stephen O'Sullivan of Mattos Filho Advogados, another big Sao Paulo law firm.
发生问题时他们希望冻结某人的银行账户，另一家律所Mattos Filho Advogados的Stephen O'Sullivan称。
And if they're the only people in the country, they'll go after the local managers, or even the lawyers.
Unsurprisingly, Mattos Filho is willing to fulfil this role only for old and valued clients.
不出意外，Mattos Filho 期待在服务已有的尊贵客户的同时能够为更多的公司扮演同样的角色。
Eirelis may eventually make it easier to set up shop in Brazil.
But only a little.
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