Civil Code, Book II: business law and the Ltda (Arts. 966–1,195)

Where the Ltda rules sit

The Ltda has its own chapter (Arts. 1,052–1,087), but where it is silent the rules on the sociedade simples apply (Art. 1,053). The articles may instead choose the Corporations Law (Law No. 6,404/1976) as the subsidiary regime (Art. 1,053, sole paragraph). That choice is not a formality: it decides, among other things, how withdrawal and some governance questions are handled, so make it deliberately when drafting.

Majorities after the 2019–2022 reforms

Older guides still quote three-quarter majorities for amending the articles. That is no longer the law. The current position:

The articles may set higher majorities for most matters. Minority investors usually negotiate them there, or in a quotaholders’ agreement.

Single-member Ltda and the end of the EIRELI

Since 2019 an Ltda may have one member (Art. 1,052 § 1). The EIRELI, which required capital of 100 minimum wages, was turned into the single-member Ltda by Law No. 14,195/2021 and its article was revoked in 2022 (Art. 980-A). A foreign company can be the sole member of a Brazilian Ltda.

Foreign members, foreign companies and branches

Art. 1,134 requires federal authorisation for a foreign company to operate in Brazil, for example through a branch. The procedure is slow and the branch is tied to the authorisation for every later change (Art. 1,139), which is why almost every foreign investor uses a subsidiary Ltda instead. Holding quotas in a Brazilian Ltda needs no authorisation. In practice a foreign member needs a Brazilian tax number (CNPJ for a company, CPF for an individual) and a resident attorney with power to accept service, and the investment is registered with the Banco Central under Law No. 14,286/2021. An administrator who lives abroad needs an attorney resident in Brazil with power to receive service of process; registry practice on non-resident administrators has changed since 2021, so check the current DREI instruction before appointing one.

Buying a business rather than a company

Arts. 1,144 to 1,149 govern the sale of an establishment as a going concern (trespasse). The buyer is liable for debts properly recorded in the books, the seller stays jointly liable for one year, and the seller may not compete for five years unless the contract says otherwise (Art. 1,146, Art. 1,147). Tax and labour succession are governed by other statutes and can reach further, so an asset deal is not automatically cleaner than a share deal.

Books and accounts

Every business company must keep accounts, a journal and annual financial statements (Art. 1,179, Art. 1,180). Large limited companies, with total assets above R$ 240 million or annual revenue above R$ 300 million, are subject to the Corporations Law rules on financial statements and independent audit under Law No. 11,638/2007.