terça-feira, 14 de novembro de 2017

Why aren’t tourists flocking to Brazil? - The Brazilian Report

Why aren’t tourists flocking to Brazil?It has come to my attention that there is a new website focused on covering Brazil and Brazilian themes. Not under a legal perspective, but a journalistic one.



Let`s hope they do a good job. You can check a sample of their work on the link below.





Why aren’t tourists flocking to Brazil? - The Brazilian Report:



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quinta-feira, 9 de novembro de 2017

Chinese firms plan bid for railway linking Brazil’s grain regions | South China Morning Post

Chinese firms plan bid for railway linking Brazil’s grain regions | South China Morning Post:


With 1,100km, Ferrogrão will connect grain-producing regions in Brazil’s centre-west to the port of Miritituba, in the northern Pará state. The railway is expected to be an alternative to BR-163 road, currently the only way to take grains from central Brazil to northern ports.
The project is estimated to demand 12.6 billion reais (US$3.89 billion) in investments.
“The Chinese are very interested in Ferrogrão,” he said, referring to state-owned enterprises in sectors such as cement and steel.
In May, Brazilian and Chinese officials launched a joint Brazil-China investment promotion fund to increase productive capacity.
The fund has an initial sum of US$20 billion to finance investment projects in Brazil that are of interest to both countries.
In June, Jorge Arbache, foreign affairs secretary of Brazil’s planning ministry, said the fund was ready to receive investment pitches.
He said the fund’s investment decisions will be made by a committee composed of Brazilian and Chinese officials, taking into account both countries’ priorities.
The fund agreed on last year is expected to help finance the construction of railways. This will link Brazilian soy- and corn-producing areas to ports, potentially boosting Brazil’s economy as it slowly emerges from a deep recession.
China also stands to gain because it is a large buyer of Brazilian grains.

terça-feira, 7 de novembro de 2017

Exporting/Importing from Brazil Made Easier: Changes to the Foreign Trade Portal

This is an article I wrote to Bloomber, in partnership with Harris Group, a Chilean-Australian law firm. I`m not sure if or when the article has been published by Bloomberg, but I`m posting the original text. 

This article describes legal changes that helped Brazil to climb a few positions in the Doing Business ranking from 2018 (as mentioned here).


Brazil is a very large country, with clear regional differences. It is also organized as a federation, which means that part of the state authority resides in the member states. And, finally, it has a well-developed legal system, covering most of the areas associated with modern democracies, such as environmental controls, export quotas, etc. This legal system, however, is not backed up by an efficient administrative body, but rather by a very fragmented and often untrained team of public servants. As a result, entrepreneurs must face a myriad of local and federal regulations, managed by a circuit of suspicious bureaucrats.

This is even more apparent during the export process. There is frequent confusion regarding the production of documents. Different federal bodies have conflicting and overlapping competencies. Some procedures are performed on paper, while others are processed electronically, causing the exporter to type in the same information two or three different times. Moreover, the individual systems used by federal bodies do not communicate with the overall system, called “Siscomex”. Due to this gap in communication, the exporter must keep a physical file containing extracts of all the documents and licenses. This dossier was kept in place in order to instruct the inspectors, in case a physical inspection is needed.

In order to solve this, the Brazilian government has been studying a way to centralize the import-export procedure, making it more efficient. To this effect, several rounds of public consultation have been carried out. The government has also been continuously making changes to the Siscomex, in an attempt to streamline the process: improvements were  slowly taking place.

However, since the traumatic impeachment process of 2015–2016, the Brazilian economy has needed a burst of incentive to start running again. From the onset, President Temer’s administration has been in a hurry to deliver reforms that would have an immediate impact on results in GDP. It just so happened that the consolidation of export procedures was the kind of cheap reform that could be implemented quickly. It involved no major spending and the framework was already in place.

Indeed, the unified export system has started with exports by air and, as of June 2017, it became the main route for Brazilian exports in other modalities (road, rail, maritime, etc. ).

The main rules that put the system in place were the Federal Revenue Service/Export Secretary directive n. 349, from march 21, 2017 and the CONAMA directive n. 14, from march 22, 2017.

A description of the system’s main features and how it benefits business is provided below.

Unified Declaration
Exports are now managed through an easily accessible online platform (ww.siscomex.gov.br). The system has been designed as a "single window" platform, where several agencies can interact with the exporter. The interaction includes the publishing of rules and clarifications and also the exchange of documents and forms.

Moreover, the export procedures have been streamlined. They now depend on a single document, the Unified Declaration of Export (Declaração Unificada de Exportação, “DUE”).

However, in reality, saying that the export process depends on a single document is not absolutely correct. The DUE is drafted based on the tax invoice (another electronic document, issued by any company in Brazil that is selling merchandise, even within the country). Also, there may be additional registrations regarding the identification of packages and cargo (as we will see below). The great innovation is that the DUE, processed via the new Siscomex page, replaces two or three other independent registrations that were required, one at each step of the export process. Every time, the data had to be typed in the system again and the process was prone to mistakes. Now, the DUE moves along the path, maintaining all the relevant information.

Attachment of DocumentsSpecial Approvals in one Place
One of the best improvement brought about by the DUE is the path for exportation of regulated products.

As any other country, Brazil restricts or controls exports of several items. Some are subject to quotas. Strategic products like oil and military equipment are subject to limitations. Some are subject to specific regulations, such as diamonds (which must receive the Kimberley certificate) or merchandise that is dependent on sanitary controls. Before the DUE, each license or certificate would have to be obtained independently and would later have to be somehow added to the export documentation, or presented during an inspection.

Now, these documents can be added to the system. Actually, the export procedure can be initiated without them and the exporter may obtain the licenses over time, as long as they are ready before shipping.

This brings about another feature of the Siscomex single window platform. Additional documents can easily be scanned, signed digitally and added to the platform, This was not possible, or was very restricted, in the past.

Cargo Control
The unified export system has also adopted a unified reference for cargo (call “RUC”). This has been designed according to the WTO recommendations regarding a "Unique Consignment Reference."

The RUC allows for the aggregation of several invoices into a single cargo and will be used to track shipments through all stages of the export process.
Management of information related to packages and cargo used to be somewhat chaotic. This is certainly a welcome improvement.

Detailed Specification
The system allows for the insertion of additional details about the products being exported. This feature aims at fixing a common problem, which was the request for more detailed specifications by the Customs importers. Since the information about the products was dispersed in several documents, and since the Harmonized System Code (adopted in Brazil with some modifications and called the “NCM code”) allows for generic classification (such as "other"), it was common to see a merchandise identified by its NCM, by a written description, and by some other code used internally by the Brazilian customs or tax authorities.

The system has been designed to coordinate and centralize all description in a single place. The identification will be complemented by a Global Product Code (created by GS1).

Test Mode and Consultation
A relevant feature is that the system has a testing mode, which allows the exporter to simulate the operation beforehand and to check whether additional licenses are required.

Conclusion
In summary, the system certainly brings a lot of improvements. It is being continuously improved and tends to make Brazilian exports much more agile.

The end goal is to reduce export times from 13 to 8 days and import times from 17 to 10 days. The Portal also aims to increase transparency by allowing companies to monitor the progress of their operations in detail over the internet.

According to the Doing Business study conducted by the World Bank, an export of a containerized good in Brazil takes on average 13 days to complete. An import of the same type of product requires 17 days. Additionally, it costs $ 2,215 on average to export a container from Brazil (excluding taxes), while for imports the same costs add up to about $ 2,275. This number puts Brazil in 124th place in the Doing Business trading across borders ranking.

With the Unified Foreign Trade Portal, the goal is to have export times from Brazil reduced by 38.5 percent to a maximum of 8 days, in line with global best practices, by 2017. As for imports, the aim is for average terms to be reduced to 10 days, a 40 percent decrease from current levels, by 2017. As a result of the time reductions and consequent money savings, Brazil intends to be among the 70 best countries in the world for foreign trade. Time will tell if this becomes reality.
————-
Harris Gomez Group is a law firm with offices in Santiago, Bogotá, and Sydney. We also have legal teams in Mexico, Peru, Bolivia, Brazil, and Argentina. Over the last 16 years, we have been supporting foreign companies with their growth in Latin America. Many of our clients are technology companies, service providers and engineering companies that focus on the mining, energy and infrastructure markets.

To better understand how we can support your management team, please contact Cody Mcfarlane at cmm@hgomezgroup.com

segunda-feira, 6 de novembro de 2017

SAA in row over dismissal of Brazil head

SAA in row over dismissal of Brazil head: "São Paulo en route to performances in Luanda, Angola. When the "



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Odebrecht Oleo e Gas Chapter 15 Bankruptcy | Daily Bankrupt Company Updates | Bankrupt Company News

Odebrecht Oleo e Gas Chapter 15 Bankruptcy | Daily Bankrupt Company Updates | Bankrupt Company News:



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Regulation of E-commerce in Brazil - imports via courier

The Federal Revenue Service has just issue a Normative Instruction which details the process for Courier companies to register as special trading posts, able to import and deliver a large quantity of packages directly to Brazilian customers.

Think about Amazon, Ali-express, etc.

The rules standardize the processo to register as a courier specialized in mass imports. This is the biggest advantage, as I see it. Previous rule were scattered and not very clear.

The procedure involves a lot of bureaucracy, but is not overwhelming. Courier companies must provide a minimum guarantee of 200K Brazilian Reais (about 60K USD) in favour of the Brazilian government, presumably to cover for taxes.

In this model, the courier companies will act as customs brokers, acting on behalf of the final client who puchase the goods.

The basic are not changed. For example, the 60% flat taxation applicable over the packages.

This taxation is, sometimes, supplemented by a state taxation of about 25%. For details about it, plese chek the slides of the presentation I gave at Ecommerce Expo, in London (here).

All in all, a very good initiative from the government, that will certainly attract e-commerce companies to Brazil.





Link to the full text of the Normative Instruction:



DOU 18/09/2017 - INSTRUÇÃO NORMATIVA RFB Nº 1.737, DE 15 DE SETEMBRO DE 2017:



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Doing business in Brazil - World Bank Report 2018 - a tiny surprise


Brazil has clibmed from the 123rd place to the 120th.



I understand that part of this improvement is due to a reform in the import/export procedures. They were heavily dependent on paper forms but have been updated to accept electronic form, via a centralized website.


This has been one of the most subtle reforms of Michel Temer`s government. But it has caused a lot of impact on day to day operations. This is impressive if you compare it to the enormous effort being put in the reform of the pension system, with almost zero results so far.


It also shows that a lot of the problems faced by Brazilian companies are not structural problems. The legal system is fairly well designed, most of the time.


 It is the small things that really delay business:  the double notarizations, the lack of standardization, the need to xerox a document three times, because the first two copies were not clear enought, etc.


Some other changes of procedure of the same nature than the export simplifcation have been adopted recently, with very good results. The adoption of the the Apostille for foreign documents, for example, has been working fine.



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