Import regulations and customs duties
Despite a certain trade liberalisation over the last few years, especially in terms of customs duties, it is extremely difficult to export towards the Brazilian market. Import licensing rules are very tough. The import of most of the products implies issuing a preliminary a licence at the SECEX (Secretariat of Foreign trade), which is the only organisation authorised to issue this licence. However the list of the products subject to this preliminary licence is not publicise. It is available only with registered and authorised users.
There is a minimal price procedure raising a problem when issuing these licences. When a licence is applied for, a proforma invoice has to be supplied. If the declared prices are lower than the minimum price used for calculation of the customs duties, the licence is not issued by the authorities, and no formal information is given to the applicant. The importer is then generally informed unofficially about the existence of this minimum price.
These licenses are valid for 60 days starting from the date of dispatch of the goods (sometimes, it starts from the date of applying for the license). This period is often insufficient. It is then necessary to apply for a new licence. For textiles, rules are even more strict. The license is granted only if the payment is effective within 30 days from the date of B/L. Importers compulsorily have to prove that they effectively made the payment within 30 days.
The imported goods are often blocked in customs because of documentary problems. All the imports should be accompanied at least with 2 copies of the commercial invoice and the B/L. If they do not match the legal requirements of the country, Customs are entitled to levy heavy fines, which may go even up to 100% of the usual customs duties. It is therefore advisable to work through a very good broker in Brazilian customs, who is able to get the information on time about the appropriate customs rules.
The import of second-hand industrial material is authorised under restricted conditions, as long as these goods are not produced locally and can not be replaced by some local material. The age of the material should be lower than the life expectancy estimated for the product in Brazil.
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Brazil applies the Harmonised Customs System. The customs duties are calculated Ad valorem on the CIF value. However it may be pointed out that there are certain minimal prices applied by the Brazilian Customs for calculation of the duties.
Brazil is a part of the MERCOSUR (Mercado Comun del Sur: Argentina, Brazil, Paraguay, Uruguay), whose objective is to create a free trade area, a common external tariff and a zone of free traffic of the goods, services, capital investment flows and people. The customs duties between member countries, were theoretically abolished in 1994. However there have been many exceptions, according to the "Regime of adaptation" (Regime de adecuaçao).
The common external tariff (CET) does not apply to all products: only 75% of the tariff lines benefit from a single rate. The goods still out of this system for the 4 countries are: capital goods, Information Technologies, telecommunications, motorcars and sugar. There are also a certain number of sensitive products exempted from this single rate. Brazil has about 300.
The CET should be completely set up by 2006, with the following structure:
0 % to 14 % for capital goods.
16 % to 20 % for textiles, clothing items and consumer goods.
10 % to 15 % for metal industry.
12 % to 16 % for farm products and sectors of data processing and telecommunications.
It is applied Ad valorem on the CIF value of the goods. Nevertheless, it is necessary to be careful with this customs policy, since these countries do not strictly bring the recommendations of the central organisation into operation, but do so according to their economic condition. Please note that exports within Mercosur does not entitle you for exemption of duties: so if you export a product to Brazil in order to, then, resell it in Argentina, you will pay both Brazilian and Argentinean duties.
Also, there are various customs agreements, either between Mercosur and other countries (EU, Chile), or in a bilateral way with Argentina and other countries (Chile, Andean Pact). Air mail dispatches valued from $51 to $3000 are subject to a tax of 60 % on the FOB value of the goods.
Besides, there are many other taxes on goods:
- Guia de Importacao: $70 payable lump sum to obtain an import license.
- Merchant Marine Renovation Fee: 25 % of the total amount of the freight (except imports intended to the West Amazon, or from Manaus trade zone). Air mail dispatches valued at $51 to $3000 are subject to a tax of 60 % on the FOB value of the goods.
Regulations governing payments
There are no more controls nor limitations of the exchanges since 1990.
The main industrial and commercial areas of the country are located in the triangle of Sao Paulo, Rio de Janeiro and Belo Horizonte. The other important zones in terms of economy are located near Salvador, Curitiba, Florianopolis, Porto Alegre and Recife.
Because of the particularities of the Brazilian market, it is advisable to start any commercial transaction with the help of an agent or a distributor. Considering the size of the country, a single agent cannot cover the total territory. Indeed, in spite of the considerable improvements in terms of transport and internal communications, the regional orientation of the economy continues to be huge. Depending on the company objectives, it is better to have at least one agent in both of the main centres of activity, that is to say Rio and Sao Paulo. Agency and representation agreements are regulated by the law of December 10, 1965.
The Business to Consumer (B to C) market
With trade liberalisation that began in Brazil in 1990, various agents and distributors established themselves as independent businesses and began to sell their services. Today, a majority of the big retailing chains have their own import agencies.
In the recent years, department stores and more particularly the hypermarkets, got bigger and bigger in the distribution circle. Nowadays, the Brazilian supermarkets handle 80 % of the sales of goods of basic necessity.
The first three retailing chains in the ascending order are: Carrefour, Pao de Acucar and Sendas. Others such as Bompreco and Paes Mendoca are also very important.
It is necessary to take into account, when approaching the Brazilian market, that food and accommodation are the main requirements and that one third of the population lives below the poverty line.
The Business to Business (B to B) market
Nowadays, Brazil is one of the biggest emerging markets in the world . The process of financial evolution began in 1994 which facilitated business conditions and made possible an increase of FDI (foreign direct investments)
Transportation of goods
In practice, all the State capitals are connected by tarred roads. São Paulo, Rio de Janeiro and some other important States dispose of freeways. The road network and highways approximately cover 1.5 million kilometres, of which about 160,000 km are tarred. This is an increase of more than 300% over the last two decades. Road transport is the main means, as it is used for the transportation of about 85% of the Brazilian population and products. Recently, the management of several highways was passed on to the private sector.
This network is small as compared to the size of the country. It extends over 30,000 km (mainly in the South East States) of which only 7 % is electrified. It carries 22.5% of the goods traffic. It is managed by the Rede Ferroviaria Federal (RFFSA)
. At the moment, big projects, including a high-speed train between Rio de Janeiro and Sao Paulo are coming up.
17 % of the internal transport is handled by sea or river route; the sea traffic plays a major role in the international transport of the goods, because it transports 97% of the Brazilian exports. Some 350 million tons of goods are transported this way every year.
The main ports are: Rio de Janeiro, Santos, Paranagua
, Porto Alegre, Recife, Salvador, Vitoria
, Santos (port of Sao Paulo)
Tubarao, Itaqui, Sao Sebastiao and Manaus's river bridge.
There are 62 airports in Brazil, of which 40 are international and 22 domestic. The main ones are Rio de Janeiro (Galeo) and Sao Paulo (Guarulhos and Congonhas
). The national airline is VARIG
, and covers a major part of the international flights. The internal lines are covered by 3 companies: VASP
Conselho de Metrologia, Normalizacao e Qualidade Industrial (CONMETRO), is is part of the Department of Trade and Industry and is responsible for the implementation of Brazilian standards and certificates.
The National institute of Metrology ( INMETRO) is in charge of the implementation of the CONMETRO directives. Though the standards are generally formulated by the Associacao Brasileira of the Technical Standards (ABTN), some of them are formulated by the concerned ministries.
Patents and brands
The organisation in charge of the protection of patents and trademarks in Brazil is the INPI (Instituto Nacional Industrial da Propriedad).
Brazil adhered to the Convention of Paris for the protection of industrial property and to the agreement established by the World Organization of Intellectual Property.
Texts currently applying to patents/brands
||Date entered into law
||Period of validity
Industrial Design and Model Law
5 years renewable once
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