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Published
19 August 2022
Read time
3 minutes

Brazil is once again the most complex country in the latest Global Business Complexity Index by TMF Group

TMF Group, a leading provider of compliance and administrative services, has today launched the ninth edition of its Global Business Complexity Index (GBCI).

As it was last year, Brazil is ranked as the most complex jurisdiction for companies interested in investing in the country. Among the main reasons for this are the fact that the country goes through the highest number of regulatory changes each year. Taxes are also multi-layered, with municipal, state and federal regimes to consider. These also vary according to the industry a company operates in, making it very hard to keep abreast of all obligations amid a changing business environment. In recent years, there has been a higher focus on transparency from governmental authorities, invariably requiring more reporting and further driving up business complexity. 

The recent short-term changes in response to the pandemic also contribute to Brazil’s ranking, as well as the process of undoing these to revert to the pre-pandemic status. Some government incentives had aimed at reducing taxes to keep businesses afloat, but came with an increased administrative burden. At the same time, Covid-19 accelerated the country’s already high levels of digitalisation. Many processes, such as notarial services, that used to be done exclusively in person were replaced by digital solutions. 

The lifecycle of companies in Brazil remains, though, among the hardest to manage in the world. It can take up to 45 days to incorporate a company in the jurisdiction, and over nine months to dissolve it. Multinational companies must set up a tax ID with the federal government, select their tax regime and pay tributes both at the state and municipal level, which vary depending on the city you operate in. Companies must also have a local resident as a representative, which adds to the complexity for international investors. 

Despite these factors, Brazil is still a country characterised by huge investment potential: with a population of over 213 million inhabitants and an abundance of natural resources, it offers many opportunities for investment, especially in the energy, infrastructure and services sectors. Local specialised support can help to guide companies through the maze of regulations and deliver high-end returns. 

Brazil is still a top-tier market in key segments and a great place for investment in general - businesses all over the world are aware of that. The challenges that arise from operating here might be discouraging at first, but with all the country has to offer, that mindset quickly changes for those looking for good investment opportunities. Assets under administration in Brazil are at all-time high and we see movements in the direction of a more globalised approach when it comes to entity management.

Rodrigo Zambon Managing Director | TMF Brazil

The Covid-19 pandemic brought a higher level of complexity due to the implementation of schemes to help businesses cope, then due to their reversal. But when you think about one of the biggest populations in the world and all the investment opportunities there, many do tend to seek out local help and tap into the potential of the jurisdiction.

Michael Seligman Head of the Americas | TMF Group

Media Contacts

TMF Group:
Giampaolo Arghittu, Senior Global External Communications Manager, 
giampaolo.arghittu@tmf-group.com 
T: +39 334 947 95 84