GENERAL CLIMATE AND TRENDS 

General innovation climate 

What is the general state of fintech innovation in your jurisdiction, including any notable trends, innovations, innovators and future prospects? 

Fintech is a rapidly growing sector in Brazil, drawing the attention of global investors and analysts; consequently, the country is becoming one of the world's main fintech hubs. Goldman Sachs estimates that Brazilian fintech companies should generate revenues of around $24 billion in the next 10 years. 

As a result of major bank crashes in the 1980s and 1990s, local banking regulations and controls have evolved to become among the most stringent in the world, with some regulatory requirements surpassing those set out in the Basel regulatory framework. While these rules provide much stability, they also create serious hurdles for setting up and maintaining financial institutions in the country. The financial sector is thus heavily concentrated, and the five major banks hold around 84% of total loans and 90% of retail branches. However, nearly 35% of Brazilians above the age of 18 do not have a bank account. The market for payments is one on the largest in the world: there are over 100 million valid cards in circulation in the country, with over $300 billion worth of transactions in 2016. 

After he shockwaves of the 2007/08 financial crisis and the global trends of unbundling of financial services, disintermediation and customer-centric products, Brazil has experienced a boom in fintech companies in the past five years, with over 300 companies acting in payments, financial management, lending, investment, funding, insurance, debt renegotiation, cryptocurrencies, distributed ledger technology (DLT) or blockchain, foreign exchange and other services – more than the rest of Latin American countries combined. Nearly three-quarters of such companies have already received funding from third-party investors (including major foreign venture capital funds) and some are often listed among the most disruptive in the world. 

Incumbent banks have taken on different initiatives to preserve their market share: open innovation programmes, corporate venture capital funds, co-working spaces and accelerators, purchases of innovative companies and the creation of new, exclusively digital subsidiaries. Competition and collaboration have been marching hand in hand.

Key technologies 

Have there been any particular developments – regulatory or commercial – in any of the following fintech sectors? Distributed ledger technology and digital currencies (eg, blockchain, smart contracts and Bitcoin)? 

As in most countries, the regulation of cryptocurrencies in Brazil is still in its infancy, with the regulators watching closely the development of the market in Brazil and abroad, but bewildered by a cloud of uncertainty on some issues. 

As is also the case in other jurisdictions, while cryptocurrencies are feared or misunderstood, blockchain/DLT is lauded as the future and welcomed with open arms in Brazil. The Central Bank of Brazil has been developing different studies in DLT and its application in the issuance of currency, identity verification and transaction settlement. 

As of the beginning of 2018, no rules or official guidance have been issued with respect to DLT. However, both the Central Bank of Brazil and the Brazilian Securities Commission (CVM) have formally positioned themselves with respect to initial coin offerings (ICOs) and cryptocurrencies. 

CVM 

On October 11 2017 the CVM issued an official note regarding its position on the issue, which is somewhat similar to the one taken so far by the US Securities and Exchange Commission. The CVM's view is that ICOs are public offers for raising funds that have, as counterpart, the issue of virtual assets – tokens or coins. Such assets may, depending on the economic context of their issue and the rights conferred on the investors, represent securities under Article 2 of Law 6385/76 and, therefore, be subject to the supervision of the CVM. 

The CVM's note also stated that where the assets have the characteristics of securities, both the offers and the issuers are subject to specific regulations and penalties in the event of non-compliance with the existing rules. The CVM also acknowledged that certain ICOs fall outside its remit as they do not constitute public offerings of securities. 

The note also clarified that securities offered through ICOs cannot be legally traded on specific virtual currency trading platforms (virtual currency exchanges), as such platforms are not authorised by the CVM to facilitate trading environments of securities in Brazil. This position limits these exchanges' ability to trade in Brazil virtual assets issued abroad that could be included in the definition of 'securities' for the purposes of Brazilian law. The note also contains warnings to potential investors in ICOs about the risks inherent to such investments. 

In November 2017 the CVM published online frequently asked questions (FAQs) on the subject. The FAQs clarify others issues: 

  • tokens or coins that grant the investor rights to participate in capital or in pre-fixed remuneration agreements on capital invested or voting in assemblies that determine the direction of the business of the issuer will likely be treated as securities;
  • utility tokens that give access to a platform or service (as if they were a licence to use or credits for services) may not, in principle, be treated as securities, provided that they do not have other characteristics of securities;
  • if a token or coin is classified as a security, its issue or negotiation will be subject to the normal rules applicable to other securities;
  • cryptocurrency exchanges will be subject to licensing with the regulators if they trade coins or tokens that are considered securities; and
  • white papers on the crytpoasset being offered are generally deficient and do not provide the level of disclosure or guarantees given in a regulated prospectus – and, as such, confer very little safety to investors. 

In January 2018 the CVM issued a directive forbidding most investment funds from having direct exposure to cryptocurrencies, and asking market agents to avoid indirect exposure until new rules are issued. A regulatory framework for investment vehicles in cryptoassets should be issued later in 2018.

Central Bank 

Similarly to the CVM, the Central Bank issued a statement and launched a FAQ webpage in November 2017, with warnings on the risks involved in dealing with such assets, stressing that: 

  • the companies that negotiate or keep cryptocurrencies on behalf of users are not regulated, authorised or supervised by the Central Bank of Brazil; and
  • transactions with cryptocurrencies involving international transfers referenced in foreign currencies do not exclude the obligation to observe foreign exchange regulations, in particular the execution of transactions exclusively through institutions authorised by the Central Bank of Brazil to operate in the foreign exchange market. 

This note conveys a clear message that the Central Bank considers the cryptocurrencies market as falling under the remit of the regulatory authorities, and that the Central Bank will exert its powers whenever it sees risks to the financial system. However, the second point above creates uncertainty as it implies that payments made with Bitcoin or other cryptocurrencies to international counterparties could, in theory, be considered international transfers. The practical application of such guideline remains to be seen. 

Alternative lending platforms? 

Fintech companies dedicated to offer credit solutions are thriving in Brazil. Many of them concentrate on segments largely left aside by regular banks, offering loans at lower costs to specific niches, microcredit, etc. Others offer loans to customers that can provide some form of collateral, with rates 20% or less than those charged by banks.

Most of such companies, however, have a legal structure that involves some form of collaboration with traditional banks, which are the institutions formally authorised by law to grant credit to the public. Normally, the bank is the actual issuer of the note, while the fintech company manages the other aspects of the loan and its collection. Companies focused on peer-to-peer (P2P) lending also adopt a similar structure, for the same regulatory reason. 

Many credit fintech companies use structures of securitisation of receivables as a way to develop their operations. Credit rights investment funds (FIDC) raise resources in the capital markets that the fintechs then use to acquire their loan portfolios. The sale of the portfolio thus funds the expansion of these companies. 

Given the growth of the market and the inadequacy of the existing rules, the Central Bank proposed in the end of 2017 a draft rule specifically directed at lending and P2P fintechs to establish a clear regulatory framework for the sector. The new rule should come into force in the first half of 2018, setting the guidelines for two new types of financial institution: the direct credit company (SCD) and the P2P loan company (SEP). 

SCD 

The SCD will be allowed to grant credit directly to its final users. Its activities should be developed exclusively through an electronic platform, and the loans should use only funds originated from the SCD's own capital. In other words, the company may not collect funds from third parties for further transfer to its clients. 

The SCD shall have a minimum capital stock of R1 million, and its net worth cannot fall below such threshold. The company will also be obliged to maintain certain controls and policies applicable to other financial institutions. The licensing procedure is thorough – the company must identify its control group, provide proof of financial and economic capability, present the summary of its business plan, etc. The rule expressly allows the corporate control of the SCD to be exercised by national or foreign investment funds. 

SEP 

The SEP shares some of the requirements and characteristics of the SCD. Capital requirements and licensing procedure are essentially the same, and the company will also be obliged to maintain certain controls and policies applicable to other financial institutions. 

The operational activities of the SEP are more regulated than those of the SCD. The SEP is forbidden to use its own financial resources in offering or paying the loans between its clients, or otherwise expose itself directly or indirectly to the risk of credit operations implemented through the platform. Funds related to the loans shall be segregated from the SEP's own resources, and the SEP may not use for its own benefit the fund related to the loans. 

Creditors under the loan may be individuals, legal entities or investment funds. Debtors may be individuals or legal entities domiciled in Brazil. In principle, creditors will not be protected by the Brazilian Credit Guarantee Fund, and their exposure will be limited to R50,000, except for qualified investors. 

Several other operational rules apply, but numerous important aspects still require clarification. Although the new rule may require some adjustments from existing P2P companies, it also provides important guidelines for the sector and should foster the emergence of new competitors. 

Digital payments, remittances and foreign exchange?

Payments 

A great number of the new fintech companies in Brazil are dedicated to providing payment solutions. This is also the sector in which the entrants deal with a regulatory framework that is relatively modern and that has been tested, providing a clearer playing field for those wishing to set up their new ventures. 

A set of rules issued in 2013 by the Central Bank established the norms applicable to different payment methods, putting forth clear procedures and guidelines for payment arrangements and payments institutions, which may be licensed in one or more of the following activities:

Types of payment institutions   

Issuer of electronic currency Manages a prepaid payment account, in which resources must
be deposited in advance.
Example: Issuers of meal vouchers and prepaid cards in national currency.
Issuer of post-paid payment instrument Manages a post-paid payment account in which funds are deposited to pay debits already incurred. Example: non-financial institutions issuing credit cards (credit card is the payment instrument).
Acquirers Does not manage a payment account, but enables merchants
to accept payment instrument.
Example: institutions that sign a contract with the merchant for the acceptance of a payment card.

Law 12865/2013 explicitly prohibits payment institutions from carrying out activities that are exclusive of financial institutions, such as the granting of credit and the management of a bank checking account. Financial institutions, however, may also render the services provided by payment institutions. 

Payment arrangements 

A 'payment institution' is a company that enables purchases and sales in the context of a payment arrangement. Not all arrangements are subject to the supervision of the Central Bank: 

  • payment arrangements involving private labels cards are not regulated; and
  • arrangements that serve only to pay for public services, such as water, electricity and transportation, will not be subject to the regulation and supervision of the Central Bank. 

Furthermore, the Central Bank supervises only those arrangements with numbers greater than: 

  • R500 million of total transactions, accumulated in the preceding 12 months;
  • 25 million transactions accumulated in the preceding 12 months;
  • R50 million in funds deposited in a payment account in at least 30 days in the preceding 12 months; or
  • 2.5 million active end users in at least 30 days in the preceding 12 months.

Closed payment arrangements are also not subject to the Central Bank's authorisation if the creator of the arrangement is a commercial bank or similar entity. A payment arrangement is considered closed when the issuing and accreditation activities are performed by the same company that established the arrangement (or by companies of the same control group). In the case of payment arrangements that work the debit and credit card arrangements, the arrangement may be closed only if it processes less than R20 billion in a year. 

Foreign exchange and remittances 

Brazil exercises certain controls on cross-border currency transactions, including payment for imports and exports, transfers of capital, repatriation of capital and payments of dividends, interest, and royalties, among others. All foreign exchange transactions must be made through an authorised bank with the participation of a registered broker. 

Several fintech companies involved with foreign exchange solutions are operational and growing. Given the regulatory limitation, they are usually structured through a partnership with an existing exchange broker licensed to operate foreign currencies. 

Alternative financing (including crowdfunding)? 

Rule 588/17 of the Brazilian Securities Commission (CVM) sets forth the contours and limits for equity crowdfunding exempted public offerings. Any company bearing annual gross revenue up to R10 million in the fiscal year immediately preceding the offering may enroll with an online investment platform and raise up to R5 million per year through the offering of equity interest securities. Each investor, in turn, may invest up to R10,000, or up to 10% of its investment portfolio (whichever is the greatest), exception made for qualified and professional investors, which are not subject to any limitations. 

The emerging company may offer any securities available to it under the applicable law. Holders of securities that grant them equity interests in the emerging company and that have been acquired through an equity crowdfunding offering will have the right to sell their stake alongside the company's founders in the event of a future sale of the emerging company. 

There are many established investment platforms in the Brazilian crowdfunding market. The CVM now requires that each platform register its activities, which is conditional on the platform showing a minimum corporate capital of R100,000, in addition to IT systems and procedures adequate for the undertaking of the activities. The platform bears a series of duties within equity crowdfunding offerings, such as insuring that the issuer conforms to the standards of legality, and that information thereby provided is truthful and reliable. To this end, the CVM has opted to hold the platform's liability for information provided by the issuing company to a very high level, and in materially similar terms to a lead underwriter's liability in traditional public offerings.

 The platform must also host a webpage containing information on the offering, much to the effect of the prospectus in traditional public offerings, and a discussion board for investors to debate on the ongoing performance of their investment. 

The CVM has also permitted investors to group their interests around a lead investor, established as an equity crowdfunding syndicate. The 'following' investors will hold interest in this syndicate, whose lead investor will be responsible for mitigating the information asymmetries between issuers and investors by directing syndicate resources and to act much as the manager of an investment fund, receiving a performance fee for their services. 

Investment, asset and wealth management? 

Several Brazilian fintech companies offer services related to assets management and investments. There are no specific rules directed at fintechs, although there is a solid regulatory framework covering both areas in general. Fintech companies may be subject to licensing according to the actual services rendered – for instance, by obtaining an asset manager licence or associating with a company that has such licence. 

Robo-advice and artificial intelligence? 

Several Brazilian fintech companies are focused on the use of robo-advice or artificial intelligence/deep learning solutions. CVM Rule 592/17 regulates investment consultants in general and provides some guidance on robo-advice, stating that the same responsibilities attributed to the consultancy given out of electronic platforms also apply. Furthermore, the software code used for the advice should be available for the CVM's inspection. 

In any case, companies may be subject to licensing according to the actual services rendered – for instance, a company involved in recommending investment portfolios may be required to obtain the licence to act as an investment consultant or to associate with a company that has such licence. 

Any other technologies? 

Many new fintech companies are operational in other areas, such as financial efficiency, debt renegotiation, e-banking, etc. In 2018 the market should see new rules issued in connection with digital wallets, the exchange market, cryptocurrencies, etc. Regtech and insurtech companies have not yet seen the growth experienced by fintech ventures, although some insurtech players should expand exponentially in the coming years.

REGULATORY ISSUES 

Regulatory approach 

How would you describe the regulatory policy for fintech products and services in your jurisdiction? 

As with most countries, regulation of fintech companies is still an evolving matter. The Central Bank of Brazil and the Brazilian Securities Commission (CVM), which regulates several aspects of the financial and securities markets, have been showing a modern and collaborative approach towards the new possibilities – with a few glitches along the way. Overall, however, the regulatory framework has allowed different businesses to flourish. Rules have been issued to govern companies offering payment services, and there are discussions on legislation to deal with different aspects of cryptocurrencies, blockchain, digital wallets, peer-to-peer (P2P) lending, robo-advisers, and the exchange market – possibly with a regulatory sandbox in the pipeline to encourage growth.

Have any fintech-specific laws or regulations been enacted in your jurisdiction? Are any envisaged? 

Yes. Please see the chapters on each specific technology for a discussion of the relevant regulation applicable to each. 

Regulatory authorities 

Which government authorities regulate the provision of fintech products and services? 

There are three main regulators involved with the fintech market, with jurisdictions defined by subject area: 

  • Central Bank of Brazil – banking, loans, payments, deposits, credit card networks, foreign exchange, certain aspects of cryptocurrencies, etc;
  • CVM – securities, crowdfunding, certain aspects of cryptocurrencies, investment funds, investments and trading in general; and
  • Brazilian insurance regulator SUSEP – insurance services. 

Financial regulatory framework 

Which laws and regulations governing the provision of financial services apply to fintech businesses?

Law 4595/64 regulates the financial market and the activities of the Central Bank. The Central Bank rules cover a wide array of subjects related to the financial sector, including foreign exchange, licensing of institutions and the Brazilian payments system. Many fintech companies will be subject to some of those rules. 

Fintech companies that wish to enter into the payments sector should take into account: 

  • Law 12865/13, which sets rules on payment arrangements and institutions;
  • Resolutions 4282/13 and 4283/13 of the National Monetary Council; and
  • some Central Bank rules.

Law 6385/76 governs the securities markets and the CVM. In turn, the CVM has dozens of rules applicable to securities, public offer, investment funds, investments and trading in general and other areas that may encompass activities developed by fintech companies. In the past year, the CVM has been active in issuing new rules and guidance that touch on specific fintech issues, including crowdfunding, cryptocurrencies and robo-advisers. 

Under what conditions are fintech businesses subject to licensing requirements? Are there any exemptions? 

Licensing may be required according to the services rendered and the particularities of the chosen structure. Please refer to our comments on each specific technology for a discussion of the regulation applicable to the different activities. 

Are any fintech products or services prohibited in your jurisdiction? 

Some services involving capital markets or financial activities are subject to prior approval and may be performed only by authorised entities. Deposits and loans can be offered only by financial institutions, for instance; accordingly, most Brazilian fintech companies involved in the offer of credit are doing so via a partnership with a commercial bank. That said, new regulations to be issued by the Central Bank in 2018 will create a regulatory framework for P2P and direct credit fintech companies in which they will be allowed to operate loans under certain conditions. Likewise, foreign exchange operations require a partnership with an authorised exchange broker or bank. Details regulations also apply to payments arrangements and institutions. 

Cryptocurrencies and related issues are subject to heated debates. A regulation, when finally put in place, should restrict certain activities. 

Data protection and cybersecurity 

What rules and regulations govern the processing and transfer (domestic and cross-border) of data relating to fintech products and services? 

Law 12,965/2014 (the Internet Act) sets forth a legal framework for regulating the Internet in Brazil and thus applies to fintech companies. Internet users shall be guaranteed the secrecy of their online communications. Whenever customers' personal information or data is collected, used, transferred to or from, or stored within the Brazilian territory, the Internet Act determines that Brazilian laws shall apply. In the event that data protection provisions are breached, services providers are subject to different penalties: 

  • warning;
  • fines up to 10% of the revenues of the company in Brazil;
  • suspension of data collection, use and storage activities; or
  • prohibition to carry out the activities. 

There are also specific privacy and data protection rules applicable to banks, brokerage firms, credit card companies and other institutions involved in financial services under Complementary Law 105/2001, which provides for the confidentiality of financial transactions and strictly limits information that may be shared. Companies dealing with such information shall implement robust structures to ensure that data confidentiality is respected. 

The Central Bank is expected to put in place a new financial data protection framework during the first semester of 2018, setting standards on data processing and storage, cloud computing, corporate governance, risk management and other issues, in accordance with the institution's activities. Furthermore, backup data related to such activities should be kept in Brazil. 

What cybersecurity regulations or standards apply to fintech businesses? 

Financial institutions and other regulated entities are subject to different cybersecurity regulations and standards, according to their activities. The Central Bank is expected to put in place a new cybersecurity framework in the first semester of 2018, setting standards according to institution's size, risk profile, business model, type of operations, complexity of products, sensitivity of data and other variants. 

Financial crime 

What anti-fraud, anti-money laundering or other financial crime regulations govern the provision of fintech products and services? 

Anti-money laundering rules apply to all companies somehow involved in the provision of financial or capital markets services, including know-your-customer controls, the duty to report suspicious activities and the obligation to maintain internal anti-money laundering procedures and controls. The extension and scope of such obligations will depend on the actual activities developed by the company. 

What precautions should fintech businesses take to ensure compliance with these provisions? 

Fintech companies should take into account such obligations when preparing their business plans in Brazil. As a rule of thumb, the more regulated the area, the stricter the obligations will be. The extension and scope of such obligations will depend on the actual activities developed by the company. Companies involved in cryptocurrencies are currently facing even greater uncertainty, given that the subject has drawn attention from the Brazilian Congress and new rules could be issued directed at them. 

Consumer protection 

What consumer protection laws and regulations apply to the provision of fintech products and services? 

Brazil has strong consumer protection legislation under the Consumer Protection Code. Consumers are considered the weakest party in the supply chain, compared to suppliers. The Consumer Protection Code establishes a number of consumer protection rules that also apply to fintech companies, and include: 

  • protection against services deemed to be hazardous;
  • protection against misleading/abusive advertising;
  • possible nullification of abusive contractual provisions;
  • indemnification for patrimonial and moral damages;
  • requirements to be properly informed about potential risks and essential characteristics of products or services; and
  • protection by administrative bodies created to settle consumer disputes or impose sanctions for consumer law violations. 

Competition 

Does the provision of fintech products or services in your jurisdiction raise any particular competition regulatory concerns? 

No. Given the high concentration of banking activities with legacy banks, entrants in the fintech market will generally be seen as increasing the competition in a sector in which it is welcome. 

Cross-border regulation 

Are there any particular regulatory issues concerning the cross-border provision of fintech products and services (eg, operating jurisdiction rules and currency controls)? 

Brazil exercises certain controls on cross-border currency transactions, including payment for imports and exports, transfers of capital, repatriation of capital and payments of dividends, interest, and royalties. All foreign exchange transactions must be made through an authorised bank with the participation of a registered broker. Several fintech companies involved with foreign exchange solutions are operational and growing. Given the regulatory limitation, they are usually structured through a partnership with an existing exchange broker licensed to operate foreign currencies.  

In addition, fintech companies providing services in Brazil may be required to set up in the country if their activities are subject to licensing. Even if they are not subject to licensing, many foreign companies that try to enter the market without a clear foothold in the country face operational difficulties. 

FINANCING, INVESTMENT AND GOVERNMENT SUPPORT 

Government support 

Does the government provide any incentives or support programmes to promote fintech innovation in your jurisdiction (eg, tax incentives, grants and regulatory sandboxes)? 

There are no specific fintech programmes, although there have been speculations about a possible regulatory sandbox from the Central Bank to be implemented in 2018. 

The government provides support for small and medium enterprise development through subsidised loans and simplified tax procedures. The Brazilian Development Bank funds locally established venture capital firms, as well as programmes supporting entrepreneurs. 

There are also tax incentives for companies involved in the research and development of technological innovation.

Has the government concluded any international cooperation agreements to promote and facilitate the cross-border expansion of fintech businesses? 

No. 

Financing and investment 

What private financing and investment schemes are available and commonly used for fintech start-ups in your jurisdiction? 

In addition to companies bootstrapped by their own founders, venture capital is the most used form of financing for fintech companies. It is usually done through a direct investment in the target company's capital, through convertible debt or through the underwriting of shares. Under this model, the investor becomes a direct shareholder of the operating company if it opts to make an equity investment, or a direct creditor of the operating company, with an option to convert principal and interest into shares in the future, if it makes a convertible debt investment. 

Instead of proceeding with direct investments in Brazilian companies, some foreign investors opt to first establish Brazil-based investment funds as an intermediary equity. Rule 578 issued by the Brazilian Securities Commission (CVM) re-categorised venture capital funds under the overarching framework applicable to private equity funds. The new regulation segregates these funds into the following categories: 

  • seed capital;
  • emerging companies;
  • infrastructure and intensive economic production in research, development and innovation; and
  • multi-strategy. 

The Brazilian venture capital market is currently shifting towards a new form of investment structure, where money is not directly cashed into the Brazilian operating company. Entrepreneurs are now opting to incorporate either Delaware or Cayman parent companies to receive these funds. 

Some companies are funded by corporate venture capital funds led by established banks and other market players with the objective to identify emerging companies with products and services able to create synergies with such established players' pre-existing activities. Commonly, the fund undertakes an equity investment in the target, acquiring a minority equity holding in its capital. At the same time, the corporate venture executes a commercial agreement with the target, whereby it will use its products and services in strategic, internal processes. Only later, when the startup is more mature, will the corporate venture's focus turn to profitability or liquidity events. 

ANCILLARY ISSUES 

IP rights 

What forms of IP protection are available for fintech innovations? 

Patents may protect inventions under the Brazilian Industrial Property Law (Law 9279/96). Software is not subject to patents, but is protected under copyright laws and may be registered with the Brazilian Industrial Property Office (INPI). 

IP ownership is in principle granted to those who first file for their protection with INPI. Software codes do not necessarily require prior filing for their protection, although such filing would serve as an element of proof that the filing party had ownership at the filing date. 

Well-known trademarks are also subject to special protection irrespective of filing in Brazil, as set forth by the Brazilian Industrial Property Law and under the Paris Convention for the Protection of Industrial Property. 

What rules govern the ownership of IP rights to fintech innovations? 

The Brazilian Industrial Property Law provides for crimes against industrial property, unfair competition and the protection of inventions, utility models, industrial designs and trademarks. Internationally, Brazil is a signatory of the Stockholm Convention (1967), which established the goals of the World Intellectual Property Organisation. It is also a signatory of the Paris Convention, including The Hague and Stockholm revisions. Brazil is also a signatory of the Strasbourg Agreement on International Patent Classification. Brazil is a member country of the Patent Cooperation Treaty and the Agreement on Trade-related Aspects of Intellectual Property Rights. 

Immigration 

What immigration schemes are available for fintech businesses to recruit skilled staff from abroad? Are there any special regimes specific to the tech or financial sector? 

There are no special immigration regimes directed at fintech professionals. 

What immigration schemes are available for foreign investors and entrepreneurs wishing to invest in or establish a fintech business in your jurisdiction? 

On November 21 2017 both the Migration Law 13445/17 and Decree 9199/2017 entered into effect. The new law provides for the rights and duties of migrants and visitors, and regulates their entry and stay in Brazil. To date, only some of the new normative resolutions that will regulate temporary work visas and authorisation of residence have been published. Additional normative resolutions are expected to be approved and published in the first semester of 2018. At the moment, it is possible to apply for prior authorisation for some types of temporary work visa and authorisation to reside. 

The new normative resolutions will regulate the requirements for a visitor to apply for a residence permit to work in Brazil without having to go to a consulate abroad to apply for a work visa, as was the case in the past. In addition, under the terms of the new law, regardless of the foreigner's immigration status, the migrant may apply for a residence permit in case he or she fulfils the requirements to obtain it (including having a work offer), thereby regularising his or her migratory condition. Statutory managers will be subject to different procedures and requirements than regular employees.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.