15-05-2012, 12:12 PM
Merger and acquisition
Merger_and_acquisition_in_brazil.ppt (Size: 700 KB / Downloads: 41)
APPLICABLE LEGISLATION
The Corporations Law (Federal Law # 6.404/76) and the Limited Liability Companies Regulation (Federal Law # 10.460/02) regulate the procedures for mergers, consolidations, spin-off, acquisitions and incorporations, among other issues.
DUE DILIGENCE AND CONTRACTS
highly recommendable that a company seeks legal and auditing assistance
tax, labor and environmental legislations in Brazil are very complex and burdensome and lawsuits involving such matters in Brazil may produce a severe impact in the decision making process
Brazilian companies are more than 80% family-owned and managed by their owners
In larger companies there are professional executives. Mainly in the South and Southeast region (States of Sao Paulo, Rio de Janeiro, Minas Gerais, Paran?, and Rio Grande do Sul).
INCORPORATING IN BRAZIL
M&A operations often require that the acquiring party incorporate a new company to use in the operation due to commercial or tax planning reasons.
Brazilian law sets forth that for the incorporation in Brazil, considering the existence of a foreign shareholder, the first step is the registration of such shareholder before the National Tax Payer Register, whether it is an individual or a legal entity.
Foreign companies or individual foreign shareholders of Brazilian companies must maintain a representative in Brazil with powers to receive service of process not only regarding Brazilian Courts, but also to represent before Brazilian Tax Authorities.