Protecting Your Business in Brazil

It’s one thing to start a business back home and run it the way you want. But it’s something else to start a company in a foreign country, particularly when you may need to let someone else run it. That’s exactly what can happen to foreign business owners in Brazil.

All companies in Brazil must have an administrator. In the past, the administrator had to be a resident of Brazil. While this is no longer the case, it’s still common for foreign owned companies to hire a local administrator. It just makes the day-to-day business operations a bit easier.

But make sure that whoever you hire as the administrator is someone you can trust. Despite the challenges of running a business from abroad, there are steps you can take to maintain some level of control. There’s no perfect solution, but you can certainly mitigate the risks.

First, consider hiring a professional administrator who can provide you with client recommendations. You’ll pay a premium for quality, but you’ll get comfort knowing the person will only act based on your explicit instructions.

Second, you can include restrictions in the company’s corporate documents, such as the bylaws or Contrato Social. For example, you could say that entering into contracts over BRL$100,000 requires your prior written authorization.

And finally, make sure you have sophisticated legal counsel to guide you through the process. You want an advisor who’s familiar with helping foreign business owners navigate Brazil. After all, it’s your business you’re trying to protect.