Brasil2014 2014 Rasil Investment Guide to B
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INVESTMENT GUIDE TO BRASIL2014 INVESTMENT GUIDE BRASIL TO INVESTMENT GUIDE TO BRASIL2014 2014 EDITION 3 BUSINESS OPPORTUNITIES IN BRAZIL 46 Primary Sector 46 Agribusiness TABLE OF 51 Industry 51 Aerospace 53 Automotive 56 Energy 58 Renewable Energy and Environmental Solutions CONTENTS 65 Oil & Gas 68 Life Sciences 70 Semiconductors 75 Services 75 Infrastructure and Logistics 84 Real Estate & Hospitality 90 Support Mechanisms for Business 91 Financing 92 Tax Incentives 92 Regional Incentives 94 Small Business Support 95 Support for Innovation 4 LEGAL FRAMEWORK FOR INVESTMENT IN BRAZIL 100 Foreign Capital 101 Legal Definition 104 Contract Enforcement and Investor Protection 106 Intellectual Property 106 Registering Intellectual Property Rights 107 Intellectual Property Enforcing IP Rights 108 Taxation 109 Corporate Taxes 1 WELCOME TO BRAZIL 109 Foreign Personnel Brazil’s Competitive Edge – 10 Key Reasons to Choose Brazil 9 109 Partnerships and Joint Ventures 110 Main Taxes and Contributions in Brazil 111 Property and Land 2 DISCOVER BRAZIL 112 Rural Land Acquisition/Leasing Introduction 15 115 Environmental Policy and Regulation History Timeline 16 116 Environmental Licenses Overview of Brazil’s Territory, States and People 19 119 Visas Territorial Organization of Brazil 20 120 Permanent Residence Visas for Foreign Investors Mature Democracy with Strong Institutions 24 120 Work Visas Sound Macroeconomic Credentials 27 121 How to Establish a Business in Brazil Dynamic Economy with a Large Domestic Market 31 122 Government Entity Responsible for Opening Companies Attractive Market for Foreign Investment 32 123 Step-by-step Strong Financial System and Largest Stock Market in Latin America 34 124 Types of Companies BM&F Bovespa 35 127 Opening a Bank Account State Infrastructure: Building Today for Tomorrow’s Growth 37 128 Hiring Employees Brazil: Your Gateway to Latin America and Beyond 40 129 Benefits Currency 41 Public Holidays 42 National and other major holidays in Brazil 42 5 GOVERNMENT SUPPORT PARTNERS IN BRAZIL Other important holidays 42 135 Government Support Partners in Brazil Business Etiquette 43 141 Sources and Other Useful Links ABOUT THIS GUIDE This guide brings together essential information from various government sources to make it easier for you, to get to know Brazil, its econo- my, growth sectors, business climate and invest- ment framework. It is the product of cooperation among Brazil’s government support partners which are respon- sible to assist foreign investors: the Ministry of External Relations; the Brazilian Trade and Invest- ment Promotion Agency (Apex-Brasil); the Brazil- PREFACE ian Investment Information Network (RENAI) of Welcome to our comprehensive guide to invest- the Ministry of Development, Industry and Foreign ing in Brazil. In this publication you will gain an in- trade; and the Secretary of International Relations sight into Brazil’s economy and the essentials you of the Ministry of Agriculture, Livestock and Food need to know in order to successfully invest in the Supply (MAPA). Each institution has its own re- Brazilian market. sponsibilities, but all four work in close coopera- Brazil is an open and diversified economy with tion with one another, as well as with the private a wide array of opportunities across multiple pro- sector and other relevant public bodies. ductive sectors. For many investors, considering This guide is designed to meet the needs of growing a business in a market as vast and dy- two types of investor. For potential investors unfa- namic as Brazil is an exciting prospect. This is why miliar with Brazil, the guide contains useful, fact- the Government of Brazil is making a concerted filled information, profiles Brazil’s growing econ- effort to help support international investors who omy and provides snapshots of major business are developing business projects in Brazil. Brazil is opportunities in productive sectors. For investors open for business, and we are here to help. ready to do business in Brazil and existing inves- At a time when global business is confronted tors seeking to expand their Brazilian business with ongoing economic uncertainty, Brazil stands operations, the guide also serves as a reference out as a stable economy underpinned by solid companion to Brazil’s investment framework, in- growth. In 2012, Brazil was the world’s third-larg- cluding how to establish and run a business in the est recipient country for foreign direct invest- country and government incentive programs to ment. In the past two years alone, businesses and help expand businesses in priority sectors. entrepreneurs from across the globe have invest- ed a record US$132 billion in Brazil. The information contained in this guide was compiled in 2013. 4 5 1. welcome to WHY BRAZIL? WELCOMEBRAZIL TO BRAZIL’S 1 COMPETITIVE 10 EDGE KEY REASONS BRAZIL TO CHOOSE BRAZIL With an area covering 8.5 million square kilometers that is home to 201 million people, a territory rich in natural resources, a leading industrial base and a strong democracy, Brazil is currently one of the most attractive countries for foreign investment. 1 LEADING 2 SECURE INVESTMENT REGIONAL ECONOMY FRAMEWORK ▸ Brazil is a global growth engine ▸ Brazil was the 3rd-largest FDI and the second-largest emerging recipient in 2012 and the top market in the world after China, with destination in Latin America. a nominal GDP of $2.4 trillion in 2012 and a 3.8% average GDP growth rate ▸ Profits of multinational companies over the last decade (2002-2012). operating in the region have grown five and a half times in just nine years, from ▸ Brazil’s economy rests on solid $20.4 billion in 2002 to $113.1 billion in 2011. foundations of macroeconomic Brazil is open to foreign direct investment stability and inclusive growth. This and continues to attract leading and enabled Brazil to weather the global innovative international businesses economic crisis well, with the economy thanks to a secure investment framework rebounding from the 2009 global and highly competitive economy. recession with 7.5% growth in 2010. 8 9 3 HUGE DOMESTIC MARKET 5 ENERGY POWERHOUSE 7 WORLD-CLASS WORKFORCE 9 AGRICULTURAL ▸ Brazil has one of the largest consumer ▸ Brazil is home to the world’s 10th-largest ▸ Brazil’s demographic dividend: the vast POWERHOUSE markets in the world, with over 201 million petroleum reserves and the largest oil majority of the population falls within the inhabitants, and it is growing fast. It is due discovery made in the Western Hemisphere economically active range, with a positive ▸ Among the world’s top producers and to become the fourth-largest economy in the past 30 years with the pre-salt deep- demographic trend until at least 2020. exporters of sugar, ethanol biofuel, orange in the world by 2050 according to PwC. water oil finds off Brazil’s southeast coast. juice, coffee, soybeans, beef, poultry, ▸ Young, dynamic workforce, supported by pork, tobacco and forest products. ▸ 40 million new consumers have joined ▸ Largest exporter and 2nd-largest government professional training programs a burgeoning middle class since 2003, producer of ethanol biofuel in the world. that can be implemented in partnership ▸ New agricultural frontiers being driving growth across a variety of sectors. with businesses. opened up for agricultural development, ▸ World’s largest river basin and home putting Brazil at the cutting edge of ▸ Brazil is currently the world’s 3rd-largest to 12% of the planet’s surface water, with innovation, research and development market for beauty and healthcare products; hydroelectric power supplying 73% of in agricultural techniques, technologies 3rd-largest for PCs; 4th-largest for mobile Brazil’s energy needs. 8 MAJOR INFRASTRUCTURE and productivity gains. phones, automobiles and TVs; and 5th- largest for medical equipment. PROJECTS ▸ Sustainable agriculture: Brazil has the lowest carbon emissions among the world’s 6 INNOVATION HOTBED ▸ Brazil is making unprecedented largest agricultural players. investments in infrastructure under 4 A GLOBAL PLAYER ▸ Relevant player in research, the Accelerated Growth Program and development and innovation. the Logistics Investment Program. ▸ The ‘B’ in BRICS – a global growth 10 GATEWAY TO LATIN engine for today and tomorrow. ▸ $15 billion in credit and grants ▸ The pipeline of investment projects to support innovative projects by includes 10,000km of new railways, AMERICA ▸ Brazil is home to a competitive companies will be invested by 2014 7,500km of highways to be widened and industrial sector. A series of market under the Inova Empresa program. extended, development of 270 regional ▸ Brazil’s largest cities are consolidating reforms, including steadily declining airports, new urban mobility projects their position as global investment interest rates, lower electricity costs, ▸ Science Without Borders program will for Brazil’s medium and large cities, headquarters not only for Brazil, but improved access to financing, a reduced send 100,000 of the best and brightest new, efficient and integrated ports, for the entire Latin American region. tax burden on companies and reduced Brazilian students overseas to pursue the development of 4 international logistics costs through unprecedented graduate studies and research projects at airports, new electricity transmission ▸ Brazil is a member of the South infrastructure investment programs the world’s best universities to bring new lines and hydroelectric power plants. American Common Market (Mercosur) have strengthened industry.