The rules pertaining to Limited Liability Companies are prescribed by the new Brazilian Civil Code, in force since 11 January 2003. Some of the most important aspects in the Law are:

• The liability of each partner is limited to the corresponding equity interest, but all partners are jointly and severally liable for the corporate capital until it’s fully paid up.

• The capital is divided into quotas of equal or unequal par value.

• Unless otherwise stated in the articles of association, partners may assign any amount of their quotas to other partners without needing consent from them, and to third parties in the absence of opposition from partners holding 1/5 of the capital.

• Management is restricted to individuals, partners or not, though these individuals must be domiciled in Brazil. The appointment of non-partners for the company administration requires unanimity of votes until the capital is fully paid up, or a quorum of 2/3 of the capital thereafter.

• The articles of association may establish a Finance Committee composed of three or more standing and alternate members, partners or not, elected annually, but these members must be domiciled in Brazil.

• Corporate decisions are required:

a) By those holding 3⁄4 of the capital:

    to amend/modify the articles of association.

    to perform mergers, consolidations, dissolutions etc.

b) By those holding the majority of the capital:

    to appoint and dismiss company managers.

    to decide on managers/administrators remuneration.

    to petition for company reorganization.

c) By a majority of those in attendance unless a higher quorum is required:

    to approve company accounts.

    to appoint and dismiss liquidators and evaluate the respective accounts.

• Corporate bookkeeping is required.

• General and other partner meetings must be held as prescribed by the Civil Code.


E-mail: lawyers@marsiglialaw.com