Goal is to improve the country's position in the World Bank ranking
On March 29, President Jair Bolsonaro signed a provisional measure (MP) with the objective of modernizing and reducing bureaucracy in the business environment in Brazil, improving the country's position in the ranking World Bank Doing Business. The document brings legislative changes to simplify the opening of companies, the protection of minority investors, the facilitation of foreign trade in goods and services and the release of low-risk buildings, among others.
Using ten different indicators, the World Bank analyzes the level of ease of doing business in 190 economies around the world. In the most recent survey, Brazil ranked 124th.
According to the Ministry of Economy, the MP should raise Brazil from 18 to 20 positions in the ranking. "With the actions already outlined and in execution since 2020, together with the implementation of what is proposed in the MP, Brazil can figure for the first time, in the short term, among the 100 best economies to do business in the country", he informed , in a statement. The objective of the Bolsonaro government is, until 2022, to place Brazil among the 50 best countries to do business with. The government's expectation is that the proposal will go through and be approved by the National Congress later this year.
“This is a set of short-term measures that are not only extremely relevant for minimizing the negative effects of the covid-19 pandemic on the economy, but are also urgent, since it is necessary that the legislative changes now proposed be implemented at time to be reflected in the responses to the questionnaires in the first half of 2021 and included in the World Bank's 2022 report, ”explained the General Secretariat of the Presidency, in a note. Download here executive presentation of the measures.
The signing of the MP took place in a quick ceremony at the Planalto Palace with the presence of the Minister of the General Secretariat of the Presidency of the Republic, Onyx Lorenzoni; the Minister of Economy, Paulo Guedes; the special secretary for Productivity, Employment and Competitiveness of the Ministry of Economy, Carlos Da Costa; and the Competition and Competitiveness Advocacy Secretary, Geanluca Lorenzon; among other authorities.
Measures adopted
According to the folder, in the scope of the opening of companies, the MP determines the unification of federal, state and municipal tax registrations in the National Register of Legal Entities (CNPJ), “eliminating feasibility analyzes - which only exist in Brazil - and automating the business name check in seconds ”.
The measure also deals with the protection of minority investors, through the amendment to the Brazilian Corporate Law (Corporations), “following the good practices defined by the World Bank”. According to the Presidency, the changes will increase the decision-making power of shareholders, including minority shareholders, by increasing the advance period for sending information for use at meetings; the improvement of communication-related devices; and the prohibition against the accumulation of functions between the main director of the company and the chairman of the Board of Directors, among other measures.
Regarding foreign trade in goods and services, the text ensures, for example, the availability of a single electronic window for foreign trade operators and provides that any requirements based on the characteristics of the goods are imposed only by law, “modernizing the system of verification of non-preferential rules of origin ”.
In the same vein, according to the Presidency, the MP also grants new regulations to the profession of Public Translator and Commercial Interpreter, revoking Decree No. 13,609, of 1943. “The change reduces the bureaucracy by allowing translators to work across the country and can carry out their work in electronic media, ensuring greater legal certainty to the matter, which is indispensable for the development of foreign trade and the evolution of Brazil in several other indicators related to the business environment ”, says the note.
As part of the execution of contracts, the government instituted the Integrated Asset Recovery System (SIRA) to expedite the collection and recovery of credit. SIRA will be able to gather registration data, relationships and equity bases of individuals and companies with the objective of reducing the transaction cost of granting credit by increasing the effectiveness of lawsuits involving the recovery of public or private credits.
According to the General Secretariat, with the change, professional councils will be able to take administrative collection measures, such as extrajudicial notification and inclusion in delinquent registries, “contributing to reduce the Brazilian judicial burden”.
Another highlight of the MP refers to the supply of electricity, "in order to increase the speed of some processes of access to electricity". The text proposes solutions to the issue, such as the establishment of a deadline for the Government to authorize the execution of works to extend electricity distribution networks.
Finally, MP also promotes amendment of the Civil Code, "to crystallize the institute of intercurrent prescription already enshrined by the Supreme Federal Court in Precedent 150, thus contributing to the increase of legal security". The intercurrent prescription is the loss of the right due to the lack of action for a certain time.
See below a summary with the 20 main points of the MP:
- Unification in the CNPJ of the Federal, State and Municipal tax registrations
- Eliminates business address analysis
- Automates business name registration
- Implementation of medium risk companies (today there are high and low)
- Extends the competences of the General Assemblies
- Changes the deadlines of the General Assembly
- Establishes the participation of an independent director in publicly-held companies
- Prohibits the accumulation of positions in large publicly-held companies
- Dejudicializes the administrative charges of professional councils
- From legal certainty to statutory deadlines in the execution of contracts
- Creates the Integrated Asset Recovery System - SIRA
- Speeds up the electricity connection for low complexity works
- Makes obtaining electricity for new ventures faster
- Makes the creation of import licensing requirements more judicious
- Promotes the review of the regulatory stock of import licenses
- Extinguishes Siscoserv and simplifies international trade in services
- Eliminates the market reserve for long-haul navigation
- Strengthens the single electronic portal of Foreign Trade
- Reduce bureaucracy in the non-preferential research system
- Removes barriers and modernizes the profession of translator and public interpreter
Source: Agência Brasil and ABES
