The Economic Freedom Law affects business registration procedures

Economic Freedom Law aims to reduce bureaucracy and greater legal certainty for entrepreneurs.

28/10/2019

HIGHLIGHTS

The Economic Freedom Law affects business registration procedures


The Law 13874/2019O, resulting from the Provisional Measure 881/19, known as Economic Freedom Law, aims to reduce bureaucracy and greater legal certainty for entrepreneurs.

Regarding the changes that involve the registration of companies, there are many news and the National Department of Business Registration and Integration (DREI), under the Ministry of Economy, Industry, Foreign Trade and Services, released a summary on its page, which we reproduce, as follows:


The Drei highlights changes in business registration after the Economic Freedom Act


The National Department of Business Registration and Integration (Departamento Nacional de Registro Empresarial e Integração - “Drei”), in light of the publication of Law 13.874/2019 (Economic Freedom Law), which facilitates and simplifies the opening of companies, listed the main changes for the filing of acts in the Trade:

- Termination of licenses for low risk activities

287 economic activities, defined as low risk, do not need any authorization for implementation and operation. Thus, entrepreneurs will be able to perform business activities in an agile and compatible manner with a country prone to investments.


- End of NIRE Obligation

NIRE is no longer required, and consequently registration applications are no longer required to indicate this number, thus terminating the requirements in the absence of such indication. This is an important measure to simplify and reduce bureaucracy.


- Auto Registration

The registration of the incorporation acts, amendment, and extinction of individual entrepreneur, EIRELI, limited liability company, and cooperatives shall be performed automatically for entrepreneurs who adopt a standard instrument, as established by the DREI. In the case of incorporation, the entrepreneur will receive the CNPJ upon registration request.


- Registration of corporate acts regardless of prior authorization

Business Acts may be brought to the register regardless of prior Government authorization. DREI will inform the public agencies about the records on which they express interest for further inspection.


- Extinction of the CNE tax

There may be no price charged for the inclusion of information in the National Register of Companies (CNE). This is an important simplification measure to the procedure and cost reduction for the entrepreneur.


- Appeal to Drei

The last appeal instance of the revised business registration process became the National Department of Business Registration and Integration (formerly the Minister of State for the Economy). This is an important procedure simplification measure, which makes the entrepreneur gain in speed.


- Electronically publication of corporate acts

Business Boards may publish decision making at their websites. This is in line with the provision of digital public services to society.


- Automatic filing of acts with information

The integration, collaboration, and sharing of information, structures, and services among municipal, state, district, and federal agencies will prevent entrepreneurs from having to file acts, documents, and statements that contain merely registration information when such information can be obtained in other public databases.


- Exemption of costs for companies’ extinction

Charging a public price for the filing service of documents related to the extinction of the registration of the individual entrepreneur, Eireli and the limited company is forbidden to. This is a measure that avoids the irregular closure of business activities, which is very common in the country.


- Limited liability companies

The limited liability companies may be incorporated (originally or derivatively) by only one partner. This measure equates our corporate law with that of several countries. The "sole proprietorship" limited company is nonetheless a limited company, which is why the same rules apply to limited partnerships formed by a single partner with more than one partner, where applicable.

Public service users of companies that had paid the price prior to the publication of the Law 13874/2019 and applied for filing at a later date may demand the refund of the amounts. The right to values reimbursement also applies to users who, after the effectiveness of Law 13.874, mistakenly paid the prices of those services.

Refund requests must comply with their state or federal law.

Any questions can be directed to Drei, by e-mail: .

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