Brazil

Starting a Business in

Brazil

Listed below is a detailed summary of the bureaucratic and legal hurdles an entrepreneur must overcome in order to incorporate and register a new firm, along with their associated time and set-up costs.  It examines the procedures, time and cost involved in launching a commercial or industrial firm with up to 50 employees and start-up capital of 10 times the economy's per-capita gross national income (GNI).

The information appearing on this page was collected as part of the Doing Business project, which measures and compares regulations relevant to the life cycle of a small- to medium-sized domestic business in 183 economies. The most recent round of data collection for the project was completed in June 2011.

  • Standardized Company

  • Legal Form: Sociedade Limitada
  • City: São Paulo

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No. Procedure Time to Complete Associated Costs
1 Check company name with State Commercial Registry Office

The name can be searched online at: www.jucesponline.sp.gov.br
1 day no charge
2 Pay registration fees

A receipt of payment must be obtained for use in the Procedure 3.
1 day see following procedures
3 Register with the commercial board of the state where the main office is located and obtain identification number (NIRE)

Depending on the company activities (business or simple companies), its corporate acts (articles of association and amendments) should be registered either with the Board of Trade (Junta Comercial) or with the Registry of Civil Companies. The registration cost for limited liability companies before (i) the Board of Trade of the state of São Paulo is about BRL 75 (according to Administrative Rule No. 178, issued on September 23, 2009 by the Ministry of Development, Industry and Foreign Trade) (ii) Registry of Civil Companies fees depend on the amount of the company's corporate capital. The articles of association and amendments that are to be registered with the Registry of Civil Companies must be notarized before a Notary Public. Currently, certain State of São Paulo Board of Trade offices (e.g., Rua Cel. Xavier de Toledo, 99 - 1º andar – Centro - 01048-100 - São Paulo - SP), also provide for expedited registration of corporate documents. The website of the State of São Paulo Board of Trade is www.jucesp.fazenda.gov.br.

To take advantage of expedited registration of the company's articles of association and amendments with the Board of Trade of the State of São Paulo, most entrepreneurs choose to register either with Sindicato da Micro e Pequena Indústria de São Paulo (SIMPI) at www.simpi.com.br or with Associação Comercial de São Paulo (ACSP) at www.jucespacsp.com.br. An additional fee of BRL50 applies for expedited service. In this case, the registration will be completed within 24 hours.

On April 4th 2008, the Board of Trade of the State of São Paulo implemented the electronic system in accordance with Administrative rule (Portaria) N. 021. As a result, the entrepreneur completes the forms online (at www.jucesp.fazenda.sp.gov.br) and file such forms with the artciles of association to be registered directly with the Board of Trade.

1 day BRL 75 registration + BRL 50 (expediting fee)
4 Register for federal and state tax (Secretaria da Receita Federal do Ministério da Fazenda, SRF/MF) to obtain the CNPJ number and state tax number , which also registers employees with the National Institute of Social Security (Instituto Nacional da Seguridade Social, INSS)

For the register of the company before the Institute of Social Security (INSS), it is necessary to present to the INSS the company's Articles of Association registered before the Register of Commerce of State of São Paulo and the CNPJ Certificate.

The Normative Rule (IN) No. 748, dated June 28, 2007, issued by the Federal Revenue Services requires that the relevant company obtain licenses from Compania de Tecnologia de Saneamento Ambiental (CETESB) and/or from the Sanitary Surveillance Department (depending on its main activities). Licenses must be issued before registration in the CNPJ is granted (enrollment for the taxpayer’s tax). For example, industrial and pharmaceutical companies are required to obtain a previous license from the CETESB before applying with the CNPJ. The process at the CETESB, however, will be completed only by obtaining the installation permit and operating license from the CNPJ. The licenses from CETESB and/or the Sanitary Surveillance Department are necessary to complete the state regular process. Normative Rule IN 748 regulates only the CNPJ registration process and not the licences from CETESB and Sanitary Surveillance Department.

The Normative Rule (IN) No. 632 dated March 17, 2006, issued by the Federal Revenue Services has been amended several times and the last amendment was done by the Normative Rule No. 1,006 dated February 8, 2010 issued by the Federal Revenue Services, which updates the Programa Gerador de Documentos do Cadastro Nacional da Pessoa Jurídica (PGD CNPJ). Indeed, the registration process is sinchronized only across the Brazilian Federal Revenue Services and the State Tax Authorities. The Municipality of São Paulo has not been included in this process yet.

The registration process was synchronized across the federal revenue and tax authorities of both the state and the city of São Paulo, which allows the sharing of company registry data. When the company requests the CNPJ number, the SRF/MF, via an internal system, informs the tax authorities of São Paulo of that request. Once the company obtains registration in the CNPJ registration, its legal representative visits the Office of Federal Revenue to confirm the information contained in the forms presented to Secretaria da Receita Federal do Ministério da Fazenda (SRF/MF1).

State tax authorities schedule an official inspection of the company's head office before approving its registration. Registration of businesses before the SRF/MF (to obtain the CNPJ number) and before the tax authorities of the state of São Paulo is done simultaneously
About 22 days (including inspection visit) no charge
* 5 Receive state tax inspection


1 day (simultaneous with procedure 4) no charge
6 Register with the Municipal Taxpayers’ Registry (Secretaria Municipal de Finanças) of the City of São Paulo

An enrollment form CCM named the Cadastro de Contribuintes Mobiliários must be delivered to the municipality. One of the documents you have to present to obtain it is the IPTU.The municipal taxpayer enrollment is made through an electronic form that filled online on the website of the City Hall (www.prefeitura.sp.gov.br.)

 5 days (simultanous with previous procedure) no charge
* 7 Pay TFE to the Municipal Taxpayers’ Registry

The proof of payment of the location, installation, and operation tax (TLIF) has been replaced by a new tax, the taxa de fiscalização de estabelecimento (TFE). The main difference between the TLIF tax and the TFE tax is the basis for the annual rate: The TLIF is based on the company’s number of employees, and the TFE is based on the company’s corporate purpose.

Pursuant to the Ordinances issued by the Municipality of São Paulo, no. 05, dated January 01, 2003, no. 75, dated September 18, 2003, and no. 09, dated January 01, 2006, as well as per the Normative Rule no. 04, dated March 2, 2007, issued by the State Treasury Affairs, the costs were updated (values related to the fiscal year 2009). As a consequence, depending on the company's corporate purpose, the annual rate of TFE varies from R$ 141,82 to R$ 17.018,51.

Once the company has been registered with the Secretaria Municipal de Finanças, it shall pay an annual fee for the control and fiscalization of the compliance with municipal laws. This payment is due on the tenth day of the second month following commencement of company operations. The TFE tax is related to the operations permit (alvará de funcionamento).
1 day (simultaneous with previous procedure) BRL 425.46 (for retailing business), may vary in accordance with the company’s activities
8 Apply and obtain digital certification (token) for the use of e-invoice


2 days BRL 450 (token valid for 3 years)
9 Apply to the municipality for an operations permit (auto de licença de funcionamento)

After registration with the Secretaria Municipal de Finanças, the company has 30 days to apply for the operations permit by filling out the proper forms and submitting the required documents. The operational license is a prerequisite for the company to begin operations. However, because of practicalities and the long processing time to obtain the license, municipalities have permitted companies to operate provided that they pay the TFE. The municpality conducts ex-post inspections to certain companies, using a random sample.

As of May 2009, 8 out of the 31 districts in Sao Paolo are operating under the new electronic operational permit system. It is expected that within the next year, all districts will be using the system. Under this system, applicants can apply and receive the approval for an operational license online instantaneously.
90 days, (simultaneous with previous procedure) no charge
* 10 Register the employees in the social integration program (Programa de Integração Social, PIS)

After duly registering the new hire in the employee registry book (livro de registro de empregados), the employer must proceed to register the employees in the social integration program (Programa de Integração Social, PIS/PASEP). The PIS/PASEP registry is intended to identify the worker in order to establish an unemployment guarantee fund (FGTS) account, to request unemployment insurance, and to be entered in the National Registry of Social Information (Cadastro Nacional de Informações Sociais).

The employee must thus be registered into the PIS/PASEP to not only set up an FGTS account but also to be eligible for unemployment insurance, if necessary. To register the employee, the employer must complete a PIS/PASEP registry form (documento de cadastramento do trabalhador, DCT), to be delivered to the federal savings bank responsible for the FGTS account. The enrollment is completed in about 5 to 10 business days from application if all enrollment requirements are met. The employee is enrolled with the Social Integration Program (Programa de Integração Social, PIS) upon entry, and if the employee has already a PIS/PASEP registry, the employer must only inform the Federal Savings Bank of the new employment relationship. The employer will obtain the receipt of the application to PIS within 15 days.
1 day, (simultaneous with procedure 10) no charge
* 11 Open a special fund for unemployment (FGTS) account in bank

After duly registering the new employees in the social integration program (Programa de Integração Social, PIS/PASEP), the employer must open an Fundo de Garantia por Tempo de Serviço (FGTS account for each employee). To open the account, the company's representative or attorney-in-fact must go to any local branch of the federal savings bank (Caixa Economica Federal) with a copy of the company's taxpayer registry number (CNPJ/MF), the adhesion form issued by the Federal Saving Bank (Caixa Economica Federal), the list of employees, and the company's articles of association or bylaws. Upon opening the employee FGTS accounts, the company will make monthly deposits equal to 8% of the total payroll. The employees are entitled to withdraw those deposits for specific events provided by law (termination without cause and serious disease or disability, among others).

A new online procedure (Sistema Empresa de Recolhimento do FGTS e informações à Previdência Social, SEFIP) was developed to speed up FGTS payment and information exchange between the employer and the federal savings bank. SEFIP can be accessed through the Federal Savings Bank’s Web site. This procedure permits the online transfer of data, creating a company file with all information required by the FGTS and Social Security. After the referred data transmission, the program issues a tax payment form (guia de recolhimento do FGTS) necessary for employer contribution payment.
1 day, (simultaneous with procedure 10) no charge
* 12 Notify the Ministry of Labor (Cadastro Geral de empregados e desempregados, CAGED)

Pursuant to Law No. 4.923, dated as of December 23th, 1965, the employer must inform the Ministry of Labor of any new hires or employees dismissals. Such information shall be given to the local department of the Ministry of Labor (Delegacia Regional do Trabalho) by the seventh day of the month subsequent to the month of the event, by a written notice sent by postal mail or the Internet. In case of delay in the delivery of that information, the company may suffer a fine calculated according to the number of employees in question and the duration of the delay. In addition, the company must submit annually to the Ministry of Labor the "annual report of social information" (relação annual de informações sociais, RAIS), which contains information on company employees (vg. name, salary and date of hiring).
1 day, (simultaneous with procedure 10) no charge
* 13 Registration with the Patronal Union and with the Employees Union.

Pursuant to labor law, registration with the employees union is mandatory and ensures that the company is obeying employee labor rights. Each municipality and state must have unions that represent the activities performed by the company. Once a year, employees and employers must contribute to their representative employee unions and employer associations an amount equivalent to one day’s salary (regardless of whether they are affiliated to the union or association). The employer must withhold this amount from the employee’s pay and send it to the respective union by March of each contribution year or upon hiring the employee. As a result, the company must check each new employee’s employment booklet to verify whether any union contributions have been recorded for the year of hire. If not, the company must discount the union contribution from the employee’s pay at the end of the first month after hire and must forward the contribution to the employee’s union.

The payment of the company’s contribution to the employer's association shall be proportional to the company’s corporate capital. Payment is due every January, except for the first payment, which is due in the month of the company’s registration. The time may vary for each employers union and employees union.
5 days, (simultaneous with procedure 10) Annual fee to be paid depending on the Union.
* Takes place simultaneously with another procedure.
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