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HIGHLIGHTS

Starting a business: learn the steps and what might change in 2019

Although Brazil has been experiencing improvements in the steps that involve starting a company, this process still has the potential to be more agile and practical. A number of steps still need to be accomplished at this early stage for legalizing a business in the country.

The National Network for Simplification of Registration and Legalization of Companies and Businesses (Rede Nacional para a Simplificação do Registro e da Legalização de Empresas e Negócios - “Redesim”) is currently in operation, which aims to integrate procedures between commercial boards, Federal Revenue, states, municipalities and the licensing agencies. In this environment, the entrepreneur can make the necessary requests to complete the business opening process.

With Redesim, the average time to start a business fell from eight to five days long, compared to the last quarters of 2017 and 2018. Also increased 20% in the number of businesses started within 3 days. The data were presented by the RFB at the end of 2018.

It is important to highlight that Redesim is in development and improvement phase, with some legalization steps not yet integrated and the need for face-to-face assistance with the respective agencies.

What can change in 2019 for starting a business?

Fighting against bureaucracy at the starting a business is a theme that the political class always use to impress entrepreneurs and business groups. Undoubtedly, more agile and less complex processes are of interest to this public.

The MP 876 was created with this intention, but it did not advance. This provisional measure proposed the automatic management of companies in the commercial boards (for Individual Entrepreneur, Individual Limited Liability Company - “Eireli” and Limited Liability Companies), the extinction of some fees and the reduction of opening time or companies. Another issue would be the authorization for lawyers and accountants making authentication of documents, exempting authentication at a notary's office or attendance at the Commercial Board by the involved parties.

The current government has proposed the creation of Balcão Único to centralize the procedures for opening and closing businesses. The federal unities would have a maximum of thirty days to give the final answer about the documentation. If no response were given within this period, the company would be automatically authorized to start or end its activities.

Therefore, the MP 881, the so-called Economic Freedom MP, brings some topics in order to simplify the operation and opening of business. Approved by the president, Jair Bolsonaro, the text has to go through the National Congress, where it may undergo changes. This MP is also threatened of becoming invalid if it is not voted by August 27, 2019.

The provisional measure ends with all types of licenses, including business, health and environmental permits for low-risk activities. Another aspect is that any application for a license or permit will have a maximum time, which, when it has elapsed, will lead to approval by silence.

Starting a Business in Twelve Step: How It Works Today

Putting a new business into practice requires a set of skills and procedures, including comprehending the marketplace, planning each step and dealing with procedures and documents for the regularization of the company.

At an early stage, the following are required:

1. Establish the company’s legal nature

2. Opt for the tax system

3. Classify the business according to CNAE

4. Search and set corporate name

5. Set location

6. Prepare the company’s articles of incorporation

7. Register with the Board of Trade or the relevant agency (RCPJ or class agencies)

8. Obtaining registration with the Federal Revenue - CNPJ and INSS

9. Obtaining state taxpayer registration

10. Obtaining municipal registration and issuing business license

11. Obtaining health, environmental and related licenses depending on the company’s activity and location.

12. Pay attention to regulatory aspects in class agencies

Advice to ensure process agility

In a complex scenario such as Brazil's, the one who starts the activities gains by concentrating on the range of legal and regulatory factors surrounding the opening of a company. Domingues e Pinho Contadores advises businesses in different areas at this critical time, advising on their obligations to the responsible agencies and the necessary procedures at the federal, state and municipal levels.

How DPC may help your company?

Domingues e Pinho Contadores has specialized team ready to assist your company.
Contact us by the e-mail dpc@dpc.com.br

Author DPC

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<h1>Starting a business: learn the steps and what might change in 2019</h1>

Although Brazil has been experiencing improvements in the steps that involve starting a company, this process still has the potential to be more agile and practical. A number of steps still need to be accomplished at this early stage for legalizing a business in the country.

The National Network for Simplification of Registration and Legalization of Companies and Businesses (Rede Nacional para a Simplificação do Registro e da Legalização de Empresas e Negócios – “Redesim”) is currently in operation, which aims to integrate procedures between commercial boards, Federal Revenue, states, municipalities and the licensing agencies. In this environment, the entrepreneur can make the necessary requests to complete the business opening process.

With Redesim, the average time to start a business fell from eight to five days long, compared to the last quarters of 2017 and 2018. Also increased 20% in the number of businesses started within 3 days. The data were presented by the RFB at the end of 2018.

It is important to highlight that Redesim is in development and improvement phase, with some legalization steps not yet integrated and the need for face-to-face assistance with the respective agencies.
 
<h2>What can change in 2019 for starting a business?</h2>
 
Fighting against bureaucracy at the starting a business is a theme that the political class always use to impress entrepreneurs and business groups. Undoubtedly, more agile and less complex processes are of interest to this public.

The MP 876 was created with this intention, but it did not advance. This provisional measure proposed the automatic management of companies in the commercial boards (for Individual Entrepreneur, Individual Limited Liability Company – “Eireli” and Limited Liability Companies), the extinction of some fees and the reduction of opening time or companies. Another issue would be the authorization for lawyers and accountants making authentication of documents, exempting authentication at a notary’s office or attendance at the Commercial Board by the involved parties.

The current government has proposed the creation of Balcão Único to centralize the procedures for opening and closing businesses. The federal unities would have a maximum of thirty days to give the final answer about the documentation. If no response were given within this period, the company would be automatically authorized to start or end its activities.

Therefore, the MP 881, the so-called Economic Freedom MP, brings some topics in order to simplify the operation and opening of business. Approved by the president, Jair Bolsonaro, the text has to go through the National Congress, where it may undergo changes. This MP is also threatened of becoming invalid if it is not voted by August 27, 2019.

The provisional measure ends with all types of licenses, including business, health and environmental permits for low-risk activities. Another aspect is that any application for a license or permit will have a maximum time, which, when it has elapsed, will lead to approval by silence.
 
<h2>Starting a Business in Twelve Step: How It Works Today</h2>
 
Putting a new business into practice requires a set of skills and procedures, including comprehending the marketplace, planning each step and dealing with procedures and documents for the regularization of the company.
 
At an early stage, the following are required:
 
<ul>
1. Establish the company’s legal nature
2. Opt for the tax system
3. Classify the business according to CNAE
4. Search and set corporate name
5. Set location
6. Prepare the company’s articles of incorporation
7. Register with the Board of Trade or the relevant agency (RCPJ or class agencies)
8. Obtaining registration with the Federal Revenue – CNPJ and INSS
9. Obtaining state taxpayer registration
10. Obtaining municipal registration and issuing business license
11. Obtaining health, environmental and related licenses depending on the company’s activity and location.
12. Pay attention to regulatory aspects in class agencies
</ul>
 
<h2>Advice to ensure process agility</h2>
 
In a complex scenario such as Brazil’s, the one who starts the activities gains by concentrating on the range of legal and regulatory factors surrounding the opening of a company. Domingues e Pinho Contadores advises businesses in different areas at this critical time, advising on their obligations to the responsible agencies and the necessary procedures at the federal, state and municipal levels.