Companies Can Now Open Branches in Other Brazilian States Instantly

RIO DE JANEIRO, BRAZIL – The opening of companies’ branches in states outside of their headquarters has become instantaneous. By means of the digital integration of the state commercial registries, the registration of branches in other states can be carried out directly from the same commercial registry of the parent company, within minutes.

Until recently, opening branches in other states took several weeks. An entrepreneur who needed to open a branch in another state was required to file a resolution at the Junta Comercial (Commercial Board) where its headquarters are located. After obtaining approval of the resolution, the entrepreneur then needed to repeat the procedure and file the resolution at the Commercial Board in the state where the branch will operate.

In the case of companies opening several branches at once, registering at the Commercial Boards of several cities was required, which entailed costs with processing, travel, forwarding, and logistics. Now, an entrepreneur only needs to wait for the approval of the registration in the head office to have the registration approved in all branch locations. The procedure also becomes immediate for changes in the register, transfers of headquarters and extinctions at interstate level.

The exchange of information between the commercial boards and public bodies will be achieved through the modernization of the National Network for the Simplification of Registration and Legalization of Companies and Business (REDESIM). The procedure was regulated by Normative Instruction No. 66, published on August 7th in the Federal Gazette, but which only came into effect on November 7th, 90 days after publication.

In addition to Commercial Boards, modernization involves the Federal Treasury, the main manager of the REDESIM Portal; the Federal Data Processing Service (SERPRO), in charge of building the infrastructure for data collection, and the Brazilian Micro and Small Business Support Service (SEBRAE), which provide financial support and introduce the process of opening companies with knowledge of the matter.

Cutting red tape

At the official ceremony to introduce the new system, the special secretary of the Special Secretariat for De-bureaucratization, Management and Digital Government of the Ministry of Economy, Paulo Uebel, said the government is committed to using technology to reduce bureaucracy. According to him, the new Economic Freedom Law, combined with the digitalization of public services, is improving the lives of citizens.

“We have to think about the future, we have new challenges in simplifying the opening of new businesses and reducing time. We are undertaking the digital transformation in favor of Brazilians. Leveraging on the Economic Freedom Law, we are establishing the conditions for this to be easy,” he said.

José Ricardo da Veiga, Special Secretary for State Modernization of the General Secretariat of the Presidency, said the government is reducing the burden of the state in order to simplify entrepreneurship and the provision of public services. “Citizens are looking at a government that, historically, was heavy. It has reached a point of great difficulty to undertake. We are partners in a journey to untie these knots. Leaving the state lighter by improving the business environment. You have to clear the trail for development to happen,” he said.

Executive Director of the Retail Development Institute (IDV), Fabíola Xavier stressed that trade will be one of the main beneficiaries of the swiftness in opening branches. “The integration of trade is a dream come true. Opening a company, transferring companies, all from the same place, will provide a productivity gain that will only be measurable over time. Retailing remains strong, with the opening of commercial establishments and distribution centers throughout Brazil,” she said.

Economic freedom

In early October, the Economic Freedom Law abolished the collection of fees for the inclusion of information in the National Register of Companies (CNE) and for the filing of extinction acts of Individual Limited Liability Company (EIRELI) and Limited Liability Companies (Ltda.). According to the Ministry of Economy, the end of the charges contributes to solving the problem of companies that stop operating, but are not formally extinguished because of the costs and red tape.

Source: Agência Brasil