Ease of Doing Business -

BRAZIL

PRESENTED BY-
RISHABH SINGH
500069671
Brazil’s Economy
PARAMETER VALUE/

Region Latin America & Carribean

Income Category Upper middle income

Currency Brazilian real (BRL) = 0.258 USD
financial capital of Brazil São Paulo
GDP $ 3.388 trillion (PPP, 2018)
GDP rank 8th (PPP)
GDP per capita $16,199( PPP, 2018)
GDP per capita rank 84th (PPP)
GDP by sector Service: 76%
Industry: 18.5%
Agriculture: 5.5%

Labor force 120 million (2017)

Unemployment 11.7% ( 2018)
SOURCE: WORLD BANK
PARAMETER VALUE/
Main Industries Textiles, shoes, chemicals, cement,
lumber, iron ore, tin and steel, oil
refining ,motor vehicles and others

Ease of doing business 109th (2019)

Export goods transport equipment, iron ore,
soybeans, footwear, coffee,
automobiles
Main Exporting Partners China 21.8% European Union 16%
United States 12.3% Argentina 8%
Japan 2.4% and rest others

Import goods machinery, electrical and transport

equipment, chemical products, oil,
automotive parts, electronics

Main Importing Partners European Union 21.2% China 18.1%

United States 16.5% Argentina 6.2%
South Korea 3.4% Other 35%

SOURCE: WORLD BANK

Main Products
 Coffee
 soybeans
 wheat
 rice
 corn
 sugarcane
 cocoa
 citrus
 beef.
 Agriculture growth rate: 9.2%
Ease Of Doing Business in Brazil – A
historical perspective
Ranking -2019
 Starting the Business - Procedure
Time to complete Associated Costs
Check the availability of the Less than one day ( online No charge
company name and the procedure)
feasibility of the location
Apply for registration with the 3 days No charge
Federal Tax
Pay registration fees less than one day (online Fees included in 3
procedure) procedure
Register with the State 7 days R$141.35 + R$21.00
Commercial Registry (JUCESP) to for registration +
complete registration with the R$128.50 (service
Federal and State Tax Authorities fee)
(CNPJ and ICMS), Social Security
(INSS) and the Companies
Registry (NIRE)
Obtain a digital certification 2 days Varies from R$ 450.00
(token) for the use of e-invoices to R$ 580.00
Exports of Brazil

 Oil seeds: US$33.5 billion (14% of total exports)

 Mineral fuels including oil: $29.7 billion (12.4%)
 Ores, slag, ash: $23.7 billion (9.9%)
 Machinery including computers: $14.8 billion (6.2%)
 Meat: $13.3 billion (5.5%)
 Vehicles: $12.7 billion (5.3%)
 Iron, steel: $11.8 billion (4.9%)
 Woodpulp: $8.4 billion (3.5%)
 Food industry waste, animal fodder: $7.2 billion (3%)
 Sugar, sugar confectionery: $6.7 billion (2.8%)
Exports contd.

 Brazil’s top 10 exports accounted for about two-thirds (67.4%) of the overall
value of its global shipments.
 Mineral fuels including oil was the fastest-growing export category via its
39.8% increase over 2017, followed by food industry waste and animal
fodder’s 32.9% gain.
 In third place were Brazilian exports of woodpulp which posted a 31.5% boost
in value year over year. Close behind were Brazilian shipments of oil seeds (up
28.9%) then exported iron and steel (up 9.7%).
 Decliners among Brazil’s top 10 export categories were sugar and sugar
confectionery (down -42.3%), vehicles (down -14.1%) and meat (down -4.7%).
Imports of Brazil

 Crude oil: 6.2%

 Automotives: 5.3%
 Liquid Oils: 3.5%
 Auto parts: 2.8%
 Drugs and Medication: 2.6%
 Naphtha: 2.1%
 Electronic Components: 1.9%
 Bituminuious Coal: 1.9%
 Reception and transmission parts: 1.6%
 Potassium chloride: 1.5%
Imports of Brazil contd.

 Brazil’s top 10 imports approached three-quarters (71.9%) of the overall value

of its product purchases from other countries.
 High capital cost category ships and boats was the fastest-growing import
product category, increasing in value by 5,391% from 2017 to 2018. Imported
organic chemicals placed second via its 25.6% gain followed by vehicles
bought by Brazil which rose 24.8% year over year then the mineral fuels
including oil category thanks to its 21.7% appreciation.
Government and Politics

 The form of government is a democratic federative republic, with

a presidential system. The president is both head of state and head of
government of the Union and is elected for a four-year term, with the
possibility of re-election for a second successive term. The current president
is Jair Bolsonaro. The previous president, Michel Temer, replaced Dilma
Rousseff after her impeachment. The President appoints the Ministers of
State, who assist in government. Legislative houses in each political entity are
the main source of law in Brazil. The National Congress is the Federation's
bicameral legislature, consisting of the Chamber of Deputies and the Federal
Senate. Judiciary authorities exercise jurisdictional duties almost exclusively.
Brazil is a democracy, according to the Democracy Index 2010.
Wages and Benefits
 Wages:
In Brazil wages are usually paid on a monthly basis and cannot be reduced. If an employer
also grants some other payments on a regular basis, such as bonuses or overtime pay, those
amounts are considered as part of the total base salary for purposes of the labor laws.
 Minimum Wage:
Monthly minimum wage is defined by federal law but it may be increased by the collective
labor agreements and is annually adjusted. Nowadays, the legal minimum wage is equivalent
to BRL 937,00 (as from 01 January 2017).
 Wage Increases
Wages are usually increased annually. The law does not provide for mandatory salary
increases. Any adjustment must be the result of free negotiation between employees and
employers.
 Working Period
The regular working week in Brazil has 44 hours over a six-day period (8 hours per day – 5
days, and 4 hours per day – 1 day). It represents a system of 220 working hours a month.
 Overtime
The hours that exceed the workday must be paid with a minimum additional of 50 percent
(100 percent on Sundays or holidays). This rate can be increased under the collective labor
agreements. The law prohibits shifts over 10 hours per day, so only 2 overtime hours are
allowed for a regular working day.
Insolvency Laws

 As a rule, the Bankruptcy Law sets out that managers and parent companies of an
insolvent limited liability company or corporation are not liable for the company’s
debts and suffer no restrictions.
 However, according to Section 82, the shareholders, controllers or directors of an
insolvent company can be declared liable for the company’s debts in the event of
wrongful or abusive conduct.
 In addition, directors, controllers and parent companies may be held liable if the
bankruptcy judge pierces the corporate veil, based on a disregard of the legal
entity theory. In short, in cases of abusive use of corporate personality or fraud,
the bankruptcy court may accept an incidental procedure to lift the veil of the
corporate entity within the bankruptcy procedure.
 Finally, other statutes in Brazil (eg, labour and employment laws) set out
circumstances under which directors, shareholders and parent companies can be
held liable regardless of whether such company is insolvent.
Labor Law in Brazil

 Labor relations in Brazil are governed by the Consolidated Labor Laws and
numerous complementary laws and regulations. The 1988 constitution
contains several labor provisions. Among other things, it legalizes unions,
collective bargaining, and the right to strike in both the public and private
sectors. The constitution also sets overtime rates, provides for a monthly
minimum wage, and regulates working hours. It lists a variety of labor
entitlements, including maternity leave, vacation, worker's compensation,
social services, medical assistance and unemployment benefits.
 All workers must hold work and social security papers (Carteira de Trabalho e
Previdenciária Social, or CTPS) in which the terms of their employment
contracts must be recorded. Employers must maintain files containing
detailed information about each employee and submit this information to the
labor authorities annually in a specific electronic file (Annual Report of Social
Information, or RAIS until March 2018).
BRICS
 Brazil has a prominent role to play in the global governance architecture. The
country has sustained structural economic growth on the back of favorable
demographic drivers, growing middle class consumption and broad scale
socio-economic transformation. As a result, the business environment in the
country has steadily improved; and the number of people living in extreme
poverty have halved over the last decade. It is time for the country to place
commensurate emphasis on consolidating its position as a regional leader; and
as a key stakeholder on the global governance high table. BRICS provides the
perfect platform to marry the dual imperatives.
 Brazil boasts of one of the world’s largest domestic markets and a
sophisticated business environment. It ranks 53rd on the World Economic
Forum’s Global Competitiveness Index (2001-12), and is ahead of the rest of
the BRICS nations in the availability of financial services among other key
indicators of financial market penetration.