By João Benz and Layon Lopes*
A recurrent doubt among the entrepreneurs that seek to invest in Brazil, especially through the establishment of businesses in the country, is the requirement of nominating a legal representative for the established business since mentioned player is a fundamental part for the activity of a foreign business in Brazil.
Every foreign business that is a partner of a business established in Brazil must designate a legal representative to represent it in the country. Initially, it is important to mention that this position is very important because this person will be responsible for signing contracts and other documents, as well as represent the foreing business in all aspects throughout the national territory.
In order to constitute a legal representative, the foreign company must grant a power of attorney to the indicated representative. Such power of attorney must be duly recorded and notarized in its country of origin. It is also necessary that the foreign company send copies of its constitutive acts to Brazil, indicating who the administrators are. All documents which are drafted in a foreign language must be translated into portuguese by a sworn translator.
Who can be a legal representative and what are his or her powers?
The legal representative can be any natural person, Brazilian or foreigner, as long as this person has residence in Brazil, and a permanent visa. After being duly constituted, through a power of attorney, he or she will basically have the necessary powers to administer the business constituted in Brazil.
Besides the possibility of signing contracts, he or she may exercise company or foreign partner representation in administrative procedures, respond to requests from the Brazilian Internal Revenue Service, as well as the Brazilian Central Bank and receive notifications on behalf of the business.
Lastly, it is important to state that this role should not be mistaken with a lawyer’s role: while the duly constituted lawyer has the power to represent the business in legal and administrative proceedings, the legal representative will carry out the roles of a partner which were mentioned above.
*Layon Lopes is the CEO of Silva | Lopes and João Benz is a member of the Silva | Lopes team.
