Changes to the National Corporate Taxpayers’ Registration (CNPJ) - Inclusion of the nomination of Final Beneficiaries

Since July 2017, the national entities, in addition to entities domiciled abroad, are also required to provide their final beneficiaries information through the Coletor Nacional (National Collector, in English) at enrollment with the National Corporate Taxpayers’ Registration (Cadastro Nacional de Pessoas Jurídicas - “CNPJ”).

It is noteworthy that for entities registered with the CNPJ before July 1, 2017, such obligation must be complied with when changing any registration from this date, observing the deadline on December 31, 2018.

According to the legislation, the final beneficiary is the natural person who, in the last instance, directly or indirectly, possesses, controls or significantly influences the entity; or on behalf of which a transaction is conducted.

The natural person has significant influence when: one directly or indirectly owns more than twenty-five percent (25%) of the entity’s capital; or directly or indirectly holds or have influence in the decisions and the power to elect the majority of the entity’s management, although not controlling it.

In summary, the rules that cover entities are as follows:

A - Entities required to report their Final Beneficiaries

1. Entities domiciled abroad

1.1. Registered through the Federal Revenue of Brazil (RFB), who holds rights over 1) Real Estate; 2) Vehicles; 3) Vessels; 4) Aircrafts; and 5) Bank Accounts.

1.2. Registered through the Central Bank of Brazil Register (Cademp/BACEN), who intends to hold equity interests established out of the capital market or who carries: 1. Leasing; 2. Chartering of vessels, equipment rent and simple leasing; or 3. Importation of goods without exchange coverage, destined to the payment of capital of Brazilian companies.

1.3. Registered through the Securities and Exchange Commission (Comissão de Valores Mobiliários - “CVM”), accordingly understood, entities that invest in the financial or capital market. However, as there were different types of framework of financial market investor, separating the liabilities from the RFB into four levels/groups of entities became necessary, as detailed in the ADE Cocad 9/2017.

2. National Entities

Those Legal Nature Business Entities (classified in group 200).

2. Entities not required to report

For domestic entities that do not have anyone who falls into the concept of final beneficiary, there will not be required to report such condition at the Coletor Nacional, as well as entities of the public administration, individuals, international organizations, public companies and binational companies will not be required to report their final beneficiaries. Some exceptions are as follows:

1. Legal entities incorporated as a publicly-held company in Brazil or in countries that require the public disclosure of all shareholders considered relevant and are not incorporated in jurisdictions with favored taxation OR submitted to privileged fiscal regime;

2. Public Company; Establishment, in Brazil, of the Argentine-Brazilian Binational Company; (Binational Company).

3. In addition, those of individuals’ Legal Nature: Individual Businessman; Individual’s Business Limited Liability Company, if the holder is an individual; simple Individual Limited Liability Company, provided the holder is an individual; and Lawyers’ Unipersonal Partnership.

4. Non-profit entities that do not act as fiduciary administrators and are not incorporated in favored tax jurisdictions or subject to privileged tax regime, if they are regulated and supervised by a competent governmental authority;

5. Multilateral organizations, central banks, government entities or entities related to sovereign wealth funds; and

6. Others.

Important: Failure to complete the final beneficiary information within the requested deadline or failure to file the required documents will lead to suspension of the CNPJ registration, also preventing the execution of bank transactions, including turnover of current accounts, the realization of investments and borrowing.