Investment in Our Common Shares by Non-Residents of Brazil

    Foreign investors must register their investment in common shares under Law No. 4,131 or CMN Resolution No. 4,373 and CVM Instruction No. 560. CMN Resolution No. 4,373 affords favorable tax treatment to foreign investors who are not residents in a tax haven jurisdiction, as defined by Brazilian tax laws. For more information on Brazilian tax, see “Taxation—Certain Material Brazilian Tax Considerations.”

    Under CMN Resolution No. 4,373, foreign investors may invest in almost all financial assets and engage in almost all transactions available in the Brazilian financial and capital markets, provided that certain requirements are met. In accordance with CMN Resolution No. 4,373, the definition of foreign investor includes individuals, companies, mutual funds and other collective investment entities domiciled or headquartered abroad. Under CMN Resolution No. 4,373, a foreign investor must (i) appoint at least one representative in Brazil, with powers to perform actions relating to its investment; (ii) appoint an authorized custodian in Brazil for its investment, which must be a financial institution duly authorized by the Central Bank or the CVM; (iii) through its representative, register as a foreign investor with the CVM and the Central Bank; and (iv) obtain a taxpayer identification number from the Brazilian tax authorities.

    In addition, an investor operating under the provisions of Law No. 4,131 or CMN Resolution No. 4,373 must be registered with the Brazilian Internal Revenue Service (Receita Federal) pursuant to its Normative Ruling No. 1,634/2016, which also provides specific obligations regarding the disclosure of information on individuals authorized to legally represent a foreign investor in Brazil as well as the chain of corporate interest up to the individual deemed as their ultimate beneficiary or up to one of the entities mentioned in the corresponding legislation, which includes publicly held companies domiciled in Brazil.

    This registration process is undertaken by the investor’s legal representative in Brazil. Non-Brazilian holders should consult their own tax advisors regarding the consequences of Normative Ruling No. 1,634/16.

    Securities and other financial assets held by non-Brazilian investors pursuant to CMN Resolution No. 4,373 must be registered or maintained in deposit accounts or under the custody of an entity duly licensed by the Central Bank or the CVM. In addition, securities trading is restricted to transactions carried out on the stock exchanges or through organized over-the-counter markets licensed by the CVM, except for the transactions listed under CVM Instruction No. 560, which include transfers among foreign investors resulting from a corporate reorganization, or occurring upon the death of an investor, by operation of law or will.

    Foreign investors may also invest directly under Law No. 4,131, and may sell their shares in both private and open market transactions, but these investors are subject to less favorable tax treatment on gains than investors under Resolution No. 4,373. A foreign direct investor under Law No. 4,131 must (i) register as a foreign direct investor with the Central Bank; (ii) obtain a Brazilian taxpayer identification number from the Brazilian tax authorities; (iii) appoint a tax representative in Brazil; and (iv) appoint a representative in Brazil for service of process in respect of suits based on Brazilian Corporate Law. For additional information on Brazilian tax consequences of investing in our common shares, see “Taxation—Certain Material Brazilian Tax Considerations.”

    For further information and for details concerning the regulation for non-resident investors, please click on the link below:

    Regulation overview for non resident investors


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