Popular investment vehicles in Brazil

Updated on December 2023

• Equity investment fund (FIP)
• Infrastructure investment fund (FI-INFRA)
• Joint-Stock Company (Sociedade Anônima)
• Limited Liability Company (Sociedade Limitada)
• Investment fund in agribusiness production chains (FIAGRO)
• Real estate investment fund (FII)

• Contractual, without a legal personality.

• Contractual, without a legal personality.

• Corporate

• Corporate

• Contractual, without a legal personality

• Contractual, without a legal personality.

• Exemption for individuals and foreign investors (provided they do not hold more than 40% of the quotas and are not residents of a tax haven). 
• For legal entities, there is a 15% withholding income tax on realized income obtained from the purchase and sale of shares. 
• The sale of quotas attracts a capital gain taxation rate of 15%

• Exempt for individuals or foreign investors (not located in tax-heavens) on income received and capital gains. 
• For legal entities 15% withholding income tax on income earned. 
• IOF charged at the time of sale according to the regressive table

• Corporate taxes will generally be charged on profits (or presumed profits) in accordance with the following rates: - income tax (IRPJ): 15%-25% - social contribution on net profit (CSLL): 9% - PIS contribution: 1.65% - COFINS contribution: 7.6% After Brazilian taxes are paid, profits can be repatriated by way of dividends, which are not taxed in Brazil under Brazilian law.

• Corporate taxes will generally be charged on profits (or presumed profits) in accordance with the following rates: - income tax (IRPJ): 15%-25% - social contribution on net profit (CSLL): 9% - PIS contribution: 1.65% - COFINS contribution: 7.6%
•  After Brazilian taxes are paid, profits can be repatriated by way of dividends, which are not taxed in Brazil under Brazilian law.

• Exempt for individuals with distributed income, provided that the fund holds a minimum of 50 shareholders, and the individual does not hold more than 10% of the shares (or receive more than the distributed profits). 
• For legal entities and foreign investors 15% (exclusive – final taxation) withholding income tax on accumulated earnings.
•  Capital gains and income earned from the sale or redemption of FIAGRO shares are subject to income tax at a rate of 20% (twenty percent). 
• Starting in 2024, individuals will only be exempt if they have a minimum of 100 shareholders

• For individuals, this income is tax exempt, whether resident or domiciled in Brazil or abroad, even in jurisdictions regarded as tax heaven to Brazilian tax authorities if at least 95% of the earnings are distributed and if the fund holds a minimum of 50 shareholders. Income tax on capital gains levied at a rate of 20% for sale of redemption of quotas. 
• For legal entities 15% (exclusive – final taxation) withholding income tax on accumulated earnings. 
• From 2024 onwards, individuals will only be exempt if they have at least 100 shareholders.

• No

• No

• No

• No

• No

• Yes

• Yes

• Yes

• No

• Yes

• Yes

• Closed-ended

• Closed or opened-ended

• Opened or closed-ended

• Closed-ended

• Opened or closed-ended

• Closed-ended 

• Requires registration and supervision by the Brazilian Securities and Exchanges Commission (“Brazilian SEC”).
•  Must be managed jointly by a fund administrator and by a portfolio manager, both approved by the Brazilian SEC. 
• When publicly offered, the Brazilian SEC’s explicit approval of its offer may or may not be required, depending on the characteristics of the issuer, the investors’ investment profiles and other fund characteristics.

• Requires registration and supervision by the Brazilian Securities and Exchanges Commission (“Brazilian SEC”). 
• Must be managed jointly by a fund administrator and by a portfolio manager, both approved by the Brazilian SEC. 
• When publicly offered, the Brazilian SEC’s explicit approval of its offer may or No may not be required, depending on the characteristics of the issuer, the investors’ investment profiles and other fund characteristics.

• Opened-ended companies are subject to the Brazilian SEC’s regulations.

• No

• Requires registration and supervision by the Brazilian Securities and Exchanges Commission (“Brazilian SEC”). 
• Must be managed jointly by a fund administrator and by a portfolio manager, both approved by the Brazilian SEC. 
• When publicly offered, the Brazilian SEC’s explicit approval of its offer may or may not be required, depending on the characteristics of the issuer, the investors’ investment profiles and other fund characteristics.

• Requires registration and supervision by the Brazilian Securities and Exchanges Commission (“Brazilian SEC”). 
• Must be managed jointly by a fund administrator and by a portfolio manager, both approved by the Brazilian SEC. When the fund’s investment policy requires that at least 95% of its assets are not securities, but real estate assets, the fund administrator may also manage its portfolio, rendering the portfolio manager dispensable. 
• When publicly offered, the Brazilian SEC’s explicit approval of its offer may or may not be required, depending on the characteristics of the issuer, the investors’ investment profiles and other fund characteristics.

• Yes: limited to investors whose investment profile is characterized as qualified (mainly natural or legal persons who have financial investments worth more than BRL 1 million) and professional investors (mainly natural or legal persons who have financial investments worth more than BRL 10 million, as well as financial institutions, registered portfolio managers, and investment funds).

• No

• No

• No

• No

• No

• Enables participation in open or closed-end companies, through a wide range of titles, contracts or securities. 
• May invest up to 33% of their subscribed capital in assets abroad. 
• Tax exemption for individuals and foreign investors (provided they do not hold more than 40% of the quotas and are not residents of a tax haven).

• Tax exempt for individuals or foreign investors (not located in tax-havens) on income received and capital gains.

• Allows the use of more sophisticated investment structures not directly related with equity (ex: debentures, subscription bonuses, etc.).

• Simpler to be incorporated. 
• Requires one sole investor to be incorporated.
•  The most common corporate vehicle adopted in Brazil

• Enables investment in agribusiness through different assets, such as rural properties, participation in companies that explore the sector, or securities whose issuers are part of the agribusiness production chain. 
• Tax exempt for individuals with distributed income, provided that the fund holds a minimum of 50 shareholders, and that the individual does not hold more than 10% of the shares (or receive more than the distributed profits).

• For individuals, this income is tax exempt, whether resident or domiciled in Brazil or abroad, even in jurisdictions regarded as tax heaven to Brazilian tax authorities if at least 95% of the earnings are distributed and if the fund holds a minimum of 50 shareholders, provided that, from 2024 onwards, individuals will only be exempt if they have at least 100 shareholders.

• Investor is not allowed to redeem the fund’s shares before the fund's established duration period has elapsed. 
• Only qualified and professional investors are allowed to invest. The fund’s financial demonstrations must be annually audited by independent auditor registered with the CVM.

• In the case of a closed-ended fund, the investor is not allowed to redeem the fund’s shares before the fund's established duration period has elapsed. 
• Investment concentration limit of 20% of the fund’s assets per issuer. The fund’s financial demonstrations must be annually audited by independent auditor registered with the CVM.

• Requires the foreign investor to keep an attorney-in-fact in Brazil. 
• Needs at least two shareholders to be incorporated. 
• Incorporation process is more bureaucratic (requires deposit of 10% of the corporate capital, publishment of incorporation documents, etc.). 
• Must publish minutes of all shareholders meetings and some Board of Directors meetings.
• Must publish financial statements yearly. 
• Need to keep corporate books up-to-date. 
• Exploration of mining activities (as real assets) is subject to approval. 
• There are some restrictions for the acquisition of rural real estate properties, real estate properties located near boarders / roads / railroads and land located near the coasts in case the company is majorly held by foreign investors.

• Requires the foreign investor to keep an attorney-in-fact in Brazil.
•  Exploration of mining activities (as real assets) is subject to approval. 
• There are some restrictions for the acquisition of rural real estate properties, real estate properties located near boarders / roads / railroads and land located near the coasts in case the company is majorly held by foreign investors.

• The current rule is under public consultation and a new rule should be issued in February by the CVM, so there is uncertainty regarding the topic. 
• The fund’s financial demonstrations must be annually audited by independent auditor registered with the CVM.

• Investor is not allowed to redeem the fund’s shares before the fund's established duration period has elapsed. 
• The fund’s financial demonstrations must be annually audited by independent auditor registered with the CVM.

• Venture Capital and Private Equity.

• Long-term infrastructure operations.

• Long-term real estate investments

• Long-term real estate investments

• A wide array of investments in the agribusiness sector.

• Investment in Real Estate properties and titles related to them, such as real estate credit tiles (LCI), mortgage titles (LH), etc.