Jayme Petra de Mello Neto
Lawyer at Marcos Martins Advogados
Internationalizing a business has become a growing process among Brazilian entrepreneurs. Whether the aim is to sell a product abroad or to open a branch, the success of this expansion of operations depends on the combination of an intelligent individual strategy based on the objectives of each entrepreneur, combined with legal advice specialized in Brazilian legislation and that of the target country. Otherwise, the legal costs of an action that is not carefully planned will certainly prevent the venture from prospering in any region.
According to data released by the Dom Cabral Foundation, the percentage of Brazilian companies that have internationalized has grown steadily since 2006. In 2021, more than 40% of the world’s territory already had a Brazilian company unit, with more than 500 companies having branches in other countries – going far beyond exports.
There is no shortage of reasons. The national political and economic scenario – despite the uncertain times, especially during the election period – is favourable for internationalization. From a commercial point of view, national products and services are well received globally, along with an exchange rate difference that favors doing business abroad. In addition, Brazilian legislation, despite its complications, is well suited to expanding to other countries, helping entrepreneurs who wish to expand their business to another territory.
There are several possible ways to internationalize a company, whether through exporting, signing up business partners or even opening franchises. Although each of these options requires its own bureaucratic requirements, legal compliance and other peculiarities, all of them necessarily depend on robust legal advice to support and enable any operation abroad.
Having the unrestricted support of professionals who are experts in national law and in the desired country will make all the difference to the success of internationalization. After all, regardless of the process chosen, the cultural translation of local legal instruments will be essential in order to clearly understand the rules and legal requirements of each country so that the business can open and operate without conflict or divergence.
Each region will have completely different rules for marketing Brazilian companies – as well as different levels of complexity. In countries like the United States, concerns about national security can hinder internationalization and delay various processes, such as sending money elsewhere.
In addition, external geopolitical factors can raise other concerns for entrepreneurs, which will require extra care and preparation to avoid damage resulting from border closures, impediments to sending and receiving capital or any other transaction vital to the prosperity of the business.
We are in a world that is intensely connected and focused on data transparency, which requires a careful level of legal document organization so that external operations do not suffer from a lack of standardization and compliance.
In any case, companies seeking to internationalize will always be subject to various risks and external impacts. There is no way of defining an ideal time to start this journey, and it is up to the entrepreneur to analyze this possibility.
For anyone wishing to start this process, it is essential to thoroughly study your segment and the desired market, as well as, above all, to have the support of a law firm that has the necessary expertise to interpret foreign legislation and guide operations in the chosen country. Minimizing risks should be a constant when it comes to internationalization.
