Mandatory representative in Brazil – nuissance or safeguard?
The first step when incorporating a company in Brazil is to prepare a PoA to the local representative, who must be a permanent resident in the country. The local representative will have powers to represent the investor before the commercial registry and the tax authorities. The representative must also have powers to receive summons and subpoenas on behalf of the investor, and to manage local assets of the investor (this means, in practical terms, that he must have powers to deal on the investor’s shares) Now, due to the way Brazilian tax and labour courts work, this representative might also be liable for tax debts or labour responsibilities of the Brazilian company. On top of that, the local representative’s credit score may affect the BR subsidiary’s business. For example, by restricting its acess to lines of credit. The representative will usually receive powers to represent the investor in several dealings involving the company. For example: naming a local… Leia mais
