The lack of a centralized registering process, the unnecessary excessive delays and the multiple documents required by different management bodies cause the registering process to take, on average 107 days. In this article we will look at all the documents you need to register a company in Brazil.
Entrepreneurship in Brazil is an experience that demands focus, money and also a lot of patience. Always appearing on the list of countries in which it takes longer to start a business, Brazil’s slow process of registering companies is mainly due to bureaucracy.
Registering in the state’s Board of Trade
The Board of Trade is a government body responsible for the registry of activities relating to companies. There is a Board of Trade in each Brazilian state. It is the first government body that the owner must approach in order to start doing business in Brazil.
Here is a list of all the documents needed when approaching a Board of Trade to register a company.
- Consultation of company’s name, since two companies with the same name can not exist in the same State
- DARF, Documento de Arrecadação da Receita Federal which is Portuguese for Collection Document of the Federal Revenue, a billet used for the payment of fees to the Federal Revenue, code 6621, which is the fee referring to the registration of business
- Capa de processo, a document that contains the requirement for solicitation on the Board of Trade for the filing/record of the act
- Ficha de Cadastro Nacional, the National Registration Form, informing the identification of the company (name, location, legal nature), equity and economic activities
- Articles of association
- If the company is a Micro or Small Business, the owner must present a Declaração de Enquadramento, stating that the starting business fits in the definition of Micro or Small Business
- Notarized copy of Identification Document and CPF of the owner or of the partners. In case there is a legal entity that is partner in the new business, the CNPJ must also be provided
- Copy of proof of residence of the holder or of the partners
- Declaração de Desimpedimento dos sócios, a statement informing that any partner is not prevented, by special law, nor convicted or be under effects of conviction, the exercise of the administration of a business company
- Previous approval by the government agency, if necessary. This refers mostly to credit related companies like banks or currency exchange bureaus
When the registration of a company is completed by the company’s State Board of Trade, a NIRE, Company Registration Identification Number, is issued.
Registering to the CNPJ
With the NIRE at hand, it is time to register the company as a taxpayer, which means getting a CNPJ.
By means of an agreement between the Federal Revenue Service and most states’ Board of Trade, the process of applying or changing a CNPJ can be done through most state’s Board of Trade which can accelerate the process. A new network - REDESIM, National Network for Simplification of Registration and Legalization of Business - has been established to simplify the process.
To start the process, the applicant, who is responsible for the legal entity, must download the PGD, which is software to generate forms from the Federal Revenue Service’s website and complete the DBE, Basic Entry Form. Once this is completed, the applicant must download the software application named ReceitaNet, available here.
Throughout ReceitaNet, the DBE, along with the Ficha Cadastral de Pessoa Jurídica which is Portuguese for Registration Form for Corporate Entities, are sent to the state’s Board of Trade. The Board of Trade will check all the documentation and once checks are completed they will send it to the Federal Revenue Service office where the CNPJ number will be issued.
The documents needed for registering a company at the CNPJ are:
- Basic Entry Form for the CNPJ, DBE
- Registration Form of Legal Entity, FCPJ, followed, in case of a partnership, by the Board of Partners or Administrators, QSA
Registering to Business License
With a registered CNPJ number, you must then contact the municipality or regional government to obtain a business license. This license allows the establishment and operation of commercial activities. This is done at the City Hall or at the regional or municipal administration in the Treasury Department of each State. The necessary documentation for obtaining a Business License is:
- Prior consultation of address made by local authority
- Application for business license
- Statement of Responsibility
- Articles of Association registered at the Board of Trade
- Inscription at the CNPJ
- Documento de Arrecadação Avulso, DAR, a document, similar to the DARF, for the payment of taxes
Registering to Inscrição Estadual
Inscrição Estadual is the registration of the ICMS taxpayer and is administrated by Receita Estadual, the Treasury Department of each State. Once Inscrição Estadual is issued, the ICMS taxpayer will have its company formally registered at the Treasury Department of the State in which it was established.
Currently, most states have an agreement with the Federal Revenue Service, which will permit the Inscrição Estadual with the CNPJ through a single procedure. The Inscrição Estadual is mandatory for companies that perform in trade of goods, industry and intercity and interstate transportation services. Communication and energy services are also required to obtain a Inscrição Estadual. These companies, as they perform trade of goods and services, are required to obtain registration of the ICMS, Tax on Circulation of Goods and Services, and the documentation requested for registration is:
- Documento Único de Cadastro, DUC, and Documento Complementar de Cadastro, DCC, informing data from the taxpayer
- Notarized copy from document proving right of use of the property the company is located, lease of the property or property deed
- CPF number from the accountant
- Proof of payment to the ISS, for service providers
- Simplified Certificate from the Board of Trade
- Copies of:
- Articles of association
- Business license
- Identification Document and CPF of the holder or all partners
- Proof of residence of the holder or all partners
Registry with the INSS
After receiving the Business License, the company is able to commence trading. Regardless of whether the company employs people, she is required to sign up for the INSS, Brazilian’s Social Security institution. Despite being just the initial partners, the company must be registered with the Social Security and pay the corresponding taxes. Thus, the company representative must contact a Social Security Agency to request the registration of the company and their legal guardians. The deadline for registration is 30 days from when trading commenced.
Authorization to print invoices
The company must apply for authorization to print invoices and authentication of tax books. This is done at the local administration of each city. Companies that perform activities related to industry and commerce should contact the Department of Treasury of each state.
Attempts of reducing bureaucracy
The São Paulo State Program for Reduction of Bureaucracy accelerates the process of obtaining a Business License. The SIL, Sistema Integrado de Licenciamento, Portuguese for Integrated Licensing System, brings together all instances to be queried for licensing: Local Administration, Fire Department, Sanitary Surveillance and Cetesb, Company of Environmental Health Technology. Only 37 municipalities in the State of São Paulo are linked to the SIL.
For a company classified under the status “Business of Low Risk”, the Business License can be issued within 24 hours. With the SIL, the period for opening a “Business of High Risk” is reduced from 150 to 40 days.
The risk of a company is determined by the Brazilian Government according to the economic activity carried out by the company. The risk of a determined economic activity can be obtained by the CNAE code under which the company operates. CNAE is Brazil’s equivalent to the International Standard Industrial Classification of All Economic Activities. The charter to check what degree of risk a company has can be found here.
Programs similar to São Paulo’s SIL can be found in the States of Minas Gerais, Distrito Federal and Goiás.