Why check
Brazil is a large, sophisticated market with many reliable companies, and also with a business culture where relationships often move faster than paperwork. Whether you are about to buy from a Brazilian supplier, appoint a distributor, enter a joint venture or receive an investment, the same question applies: is the company what it says it is? The good news is that Brazil publishes much more about its companies than most countries do, and most of it can be checked online, for free, with one number.
The key: the CNPJ
Every Brazilian company has a CNPJ (Cadastro Nacional da Pessoa Jurídica), a 14-digit number issued by the federal tax authority, the Receita Federal. Ask for it at the start. It appears on invoices and contracts, and any serious company gives it without hesitation.
- 01IdentityThe CNPJ card: legal name, status, activity codes, address, opening date.Receita Federal
- 02Owners and signatoriesPartners and directors, and who may sign for the company.QSA · Junta Comercial
- 03Tax and labour standingClearance certificates: federal taxes, FGTS, labour debts, state and city taxes.Receita · Caixa · TST
- 04Payment recordProtested bills, and credit reports.Protest registries · bureaus
- 05DisputesLawsuits, and any bankruptcy or judicial recovery.State and federal courts
- 06IntegrityGovernment sanctions lists and the press.Portal da Transparência
- 07The contractWho signs, which law, which forum, how you pay.Your lawyer
Most of the first six layers can be checked online for free, given the CNPJ.
Layer by layer
1. Identity
The Receita Federal’s registration card (comprovante de inscrição e de situação cadastral) shows the legal name (razão social) and trading name, the date the company was opened, its address, its legal form, its activity codes (CNAE) and its status. The status should be ativa (active). Suspensa, inapta, baixada or nula are warning signs.
Check that the activity codes match what the company says it does, and that the opening date fits the history it tells. A trading company opened three months ago that claims ten years of experience deserves questions.
2. Owners and signatories
The same database lists the partners and directors (QSA, quadro de sócios e administradores). For the full picture, ask for the company’s articles of association (contrato social) and its latest amendments, which are registered at the Junta Comercial of the state where the company is based. They show the share capital, the partners and, crucially, who may sign for the company and within what limits. A contract signed by someone without that power can be challenged.
3. Tax and labour standing
Brazil issues clearance certificates (certidões negativas) that show whether a company is up to date:
- Federal taxes and social security: issued by the Receita Federal and the National Treasury.
- FGTS (the employees’ severance fund): issued by Caixa Econômica Federal.
- Labour debts (CNDT): issued by the Superior Labour Court (TST).
- State and municipal taxes: issued by the state and the city.
A positiva com efeitos de negativa certificate means debts exist but are suspended or being paid under an agreement, which is usually acceptable. A plain positiva means unpaid debts.
4. Payment record
Unpaid bills in Brazil are often formally protested at a notary’s office. Protests can be searched nationally through the protest registries’ central service. Credit bureaus such as Serasa Experian and Boa Vista sell reports with payment history and a score.
5. Disputes
Search the state court (Tribunal de Justiça) of the company’s state and the federal court for lawsuits, and the labour courts for claims by employees. Ask for a bankruptcy and judicial recovery certificate (certidão de falência e recuperação judicial) from the state court. A few lawsuits are normal for an active company. Many lawsuits from suppliers, or a judicial recovery, are not.
6. Integrity
The federal government publishes registers of companies sanctioned for fraud or corruption (CEIS and CNEP) on the Portal da Transparência. Search the press for the company and its partners. For large deals, ask a Brazilian lawyer for a fuller background check on the partners as individuals.
Signs that deserve a closer look
- Share capital that is tiny compared with the size of the deal.
- Partners changed shortly before your negotiation.
- An address that turns out to be a virtual office.
- Activity codes unrelated to the business proposed.
- A request to pay a different company, a person, or an account abroad.
The contract
Checks reduce risk; the contract allocates what remains. Points to settle with a lawyer:
- Who signs, with proof of their power to do so.
- Governing law and forum. Brazil is party to the New York Convention, so foreign arbitral awards can be enforced there. Arbitration is common in international contracts with Brazilian companies.
- Language: a bilingual contract, with an agreed prevailing version. Documents used before Brazilian authorities may need a sworn translation.
- Payment: to the company’s own account, through an authorised bank, with the foreign exchange contract every international payment in Brazil requires.
Where a local representative helps
Online checks tell you what is registered. They do not tell you whether the warehouse exists, whether the factory can produce what it promises, or how the people behave when something goes wrong. Gibson works between Italy and Brazil, in Portuguese, Italian and English: it can run the checks, read the documents with you, visit the company in Brazil, sit in on the negotiation, and coordinate the Brazilian and Italian lawyers so that nothing is lost between two legal systems.