Finocchio & Ustra Sociedade de Advogados

The corporate team of Finocchio & Ustra Sociedade de Advogados advised the partners of Logvett, a logistics company specialized in the animal health industry, on the sale of an equity stake to GEF Capital Partners and Vinci Compass, both investment funds. The acquisition of Logvett is part of GEF Capital Partners and Vinci Partners’ strategy to reintroduce the AGV brand into the logistics market, following their acquisition, together with Solistica, of AGV’s operations in Brazil and Colombia. With the integration of Logvett’s activities, AGV strengthens and expands its presence and business in Brazil and abroad, aiming to attract new talent and boost the logistics and transportation sector. The transaction was led by Felipe Cervone, partner of the corporate and mergers and acquisitions team, with Rachel Cerqueira Salvador Marques and Patrícia Bruzzi Carrion Paraguay, all from Finocchio & Ustra.

Luciana Camponez Pereira Moralles, partner The carbon credit market is an economic instrument created to assign value to greenhouse gas (GHG) emissions and promote their reduction, encouraging society’s transition to a low-carbon economy. However, its credibility and integrity can be seriously compromised by fraudulent schemes, which undermine investor confidence and harm global environmental objectives. When discussing the reputational crisis of forest carbon credits and the consequent weakening of the voluntary market due to fraud in REDD+ carbon credit projects (Reduction of Emissions from Deforestation and Forest Degradation, Conservation of Forest Carbon Stocks, Sustainable Forest Management, and Enhancement of Forest Carbon Stocks) in areas of the Amazon—such as the Federal Police’s Greenwashing Operation in 2024—it becomes clear that the entire carbon credit system is impacted. With the enactment of Federal Law No. 15,042/2024, which established the Brazilian Emissions Trading System (SBCE), as well as CVM Resolution No. 218, the industrial sector, as the legal obligor under the new legislation, must immediately begin preparing its GHG emissions inventories to demonstrate its emissions under Scopes 1 and 2. This requirement imposes a new environmental obligation related to the carbon footprint of business activities, demanding that GHG emissions inventories be linked to the company’s accounting information, as this information will be useful for users of sustainability reports. According to IFRS2, climate risks can affect a company’s cash flows, access to financing, and increase input costs. Thus, fraud related to climate governance will become increasingly relevant in this new corporate scenario. Currently, the voluntary carbon market already allows the trading of carbon credits without the need for a regulatory framework. However, the new legislation lays the foundation for a regulated carbon credit market in Brazil, bringing greater transparency, legal certainty, and consolidating practices that define its structure and legal boundaries. With the consolidation of this new market, risks related to fraud in the issuance of carbon credits arise, which can directly impact the pricing of these assets and generate distrust among investors and regulators. Companies and regulatory bodies have already identified vulnerabilities in this process, which may result in administrative and criminal sanctions. To avoid such fraudulent practices, GHG emissions inventories must adopt methodologies recognized by certifying entities and regulatory bodies, ensuring that the information presented to public authorities is reliable. An example of existing oversight is the requirement of the São Paulo State Environmental Company (CETESB), through Board Decision No. 83/2024, which mandates that companies in certain sectors annually submit their emissions inventories. As mentioned above, fraud is also identified in carbon credit projects based on Reducing Emissions from Deforestation and Degradation (REDD+), especially in the Amazon, where there are cases of dubious land ownership and irregular documentation. The absence of legal proof of ownership of these areas can invalidate the credits generated and expose companies to significant legal risks. This is so relevant to the market that Article 43, paragraph 16, of Federal Law 15,042/2024 establishes rules so that buyers of carbon credits are not held liable for defects related to the properties where the credit-generating projects were developed, except when their bad faith is proven. Other types of fraud include intentional underreporting of emissions, manipulation of measurements to artificially reduce reported numbers, and falsification of financial reports regarding climate risks affecting operations. Similar cases have already been identified in international markets, leading to lawsuits and severe penalties for companies. In the consumer sector, there are examples of fraud in carbon offset programs offered by aviation, tourism, and hospitality companies. In these cases, manipulated calculations increase the prices charged to customers without real compensation for the emissions, resulting in possible environmental class actions and consumer protection claims. Given this scenario, the first step for companies is to develop an environmental fraud risk management plan, implement strict controls to monitor carbon credit-related transactions, and prepare auditable emissions inventories. Conducting periodic audits, combined with the adoption of traceability technologies such as blockchain, can ensure greater transparency and regulatory compliance, strengthening confidence in both regulated and voluntary carbon markets. ⁂

Andrea Tincani, partner Camila de Godoy Ferreira, lawyer Júlia Cristina Arruda Savioli, lawyer Giovana Silva, trainee   In M&A transactions, it is common for risks and irregularities identified during the due diligence phase to require remediation before the transaction can be finalized. Additionally, certain critical steps — such as third-party approvals and structural adjustments — may be essential for implementing the transaction. These must typically be completed prior to the effective transfer of ownership. In these scenarios, the operation is divided into two distinct moments: (i) signing, when the agreement setting out the terms of the deal is executed; and (ii) closing, when the actual transfer of ownership occurs, along with the payment of the purchase price. The interim period between signing and closing allows the parties — already contractually bound — to take the necessary steps and obtain required approvals without transferring assets prematurely or incurring unnecessary risk. Conditions precedent refers to all obligations – arising from the law or by agreement between the parties – that must be fulfilled before the completion of the transaction. These are typically subject to a deadline, which varies depending on the complexity and nature of the required measures and the involvement of third parties. If a condition precedent involves a legal requirement (e.g., government or regulatory approval) and such authorization is not obtained, commitment between the parties may be rendered void, and the deal cannot proceed. Conversely, if a condition precedent is not fulfilled due to the inaction of one party, the agreement usually anticipates two options: (i) waiver of the condition by the other party, thereby allowing the transaction to close despite the breach; or (ii) termination of the agreement, often with the imposition of a contractual penalty in favor of the non-breaching party. Such penalty clauses are crucial in ensuring transactional security and risk mitigation. Conditions precedent fall into two categories: those that depend on the parties themselves and those that depend on third parties. Examples of conditions that usually depend on the parties are: modification of the target company's corporate structure, updating of the corporate structure to include or change the partners of the target company, adjustments to the target company's fiscal/tax policies, hiring of the target company's service providers as employees, obtaining authorization from the controllers of the companies involved in the purchase and sale, among others. Regarding the conditions precedent that depend on third parties, examples include: (i) approval by the Administrative Council for Economic Defense (CADE) of transactions that involve relevant players in their field of activity and/or that may impact market competition; (ii) obtention of consent from third parties who, by virtue of an agreement with the Target company, must approve changes in their corporate structure; (iii) replacement of personal or real guarantees offered by the Target company's partners; or (iv) trading of bank securities with early maturity in the event of a change in the Target company's control. Conditions precedent are not merely bureaucratic hurdles; they are vital tools in organizing M&A transactions. They ensure that all required steps and permissions are completed before the buyer takes on any risks associated with ownership. Moreover, they provide an opportunity to remedy red-flagged issues identified during due diligence. Meticulous planning, aligned with the specific needs of both parties and the target company, promotes deal certainty and reduces exposure to legal and operational risks.

The corporate law team at Finocchio & Ustra Sociedade de Advogados advised A9 — a company founded with the mission of transforming agribusiness through innovation, agility, and trust — in the acquisition of strategic assets from Coplacana, one of the most traditional and respected agribusiness cooperatives in Brazil. Established in 1948, Coplacana is headquartered in Piracicaba, São Paulo. The transaction represents a strategic move to establish A9’s presence in the agro-industrial market and to consolidate its position as the largest dealership of a leading agricultural machinery brand in the state of São Paulo. Already present at Agrishow 2025 — one of the world’s largest agricultural technology trade shows and the leading agribusiness event in Latin America — A9 reaffirms its commitment to delivering solutions at the pace agribusiness demands, with ethics, ambition, and results. The transaction was conducted by partner of the corporate and M&A Andrea Tincani, with the participation of Marcelo Schwartzmann, partner of the environmental practice, Camila de Godoy Ferreira, Letícia Flaminio, Júlia Bueno da Conceição and Giovana Silva, all from Finocchio & Ustra.

International Research and Development (R&D) agreements have become increasingly significant worldwide, as companies pursue global competitiveness, technological advancement, and integration into international value chains in response to growing demands for innovation. These agreements, however, become significantly more complex when they involve global partners, which demands careful alignment between international contractual standards and domestic legal frameworks, particularly concerning intellectual property (IP) protection and adherence to local regulatory requirements. Brazil, in particular, represents a strategic market, especially in sectors like pharmaceuticals, animal health, and biotechnology, considering that the country has one of the largest and most dynamic consumer markets in Latin America, a robust agricultural and industrial base, and an expanding innovation ecosystem supported by renowned research institutions. However, proper management of Intellectual Property (IP) is critical for these agreements to fulfill their objectives and ensure legal security for all parties involved. In Brazil, the Industrial Property Law (Law 9.,279/96), the Software Law (Law 9,609/98) and the Innovation Law (Law 10.,973/2004) constitute the legal basis for the protection of patents, trademarks, copyrights on software and technology transfer mechanisms. However, the expansion of the R&D ecosystem in Brazil faces significant hurdles, such as the slow pace of patent examination by the National Institute of Industrial Property (INPI) and the lack of specific regulations for protecting know-how and research data in multilateral projects, and understanding these specificities is crucial for foreign companies and institutions aiming for productive partnerships within the country. Therefore, it is essential that the legal advisors involved in such R&D agreements proactively include contractual mechanisms designed to protect the parties’ intellectual property assets and prevent potential disputes. These mechanisms should explicitly differentiate between each party’s pre-existing technology (background IP) and the technology developed collaboratively during the project (foreground IP), incorporate comprehensive cross-licensing provisions, clearly define ownership rights related to research outcomes and further obligation, such as but not limited to regulatory procedures. Deciding between sole ownership or co-ownership must consider factors such as the parties' actual contributions, the conditions for commercial exploitation, and the specific legal frameworks applicable both locally and internationally. While co-ownership might initially seem equitable, the parties should carefully evaluate the potential risks involved, especially concerning future commercial use of the results, as well as obligations related to IP registration, protection and rights regarding licensing to third parties and use of the IP in general. Such measures not only facilitate the equitable distribution of risks among the parties but also enhance predictability and legal certainty throughout the partnership. The lack of well-defined contractual term can lead to protracted legal disputes, particularly in agreements involving public entities and private companies. Furthermore, the protection of know-how—often inadequately addressed through generic non-disclosure agreements (NDAs)—underscores the pressing need for more robust and tailored contractual mechanisms to safeguard confidential information and proprietary expertise. Moreover, international collaborations in Brazil benefit greatly from leveraging local research institutions and universities, many of which are globally recognized for their specialized expertise, advanced scientific infrastructure, and strong track record in applied research. These institutions often serve as critical bridges between global innovation ecosystems and the Brazilian regulatory and scientific environments, having as a particularity that agreements must be compliant with public policies and applicable rules. Establishing clear, well-structured and mutually beneficial partnerships with them, and knowing the specific legal provisions, not only enhances the technical robustness and credibility of research outcomes, but also facilitates informed navigation of local regulatory frameworks and cultural nuances that directly influence how R&D activities are executed in Brazil. This localized collaboration model is essential for mitigating operational risks, accelerating innovation cycles, and unlocking access to public funding and innovation incentive programs under the Brazilian legal framework. Finally, companies and institutions negotiating international R&D agreements involving intellectual property in Brazil should adopt a strategic and structured approach that includes a comprehensive checklist addressing the key contractual elements discussed, along with proactive and well-informed negotiation practices, aimed at mitigating future risks and enhancing both commercial and technological outcomes. In addition, continuous monitoring and regular updating of the contractual terms and conditions are essential due to the dynamic nature of both technological advancements and regulatory changes. The parties should formally establish mechanisms for regular reviews to ensure that contractual terms remain responsive to new legal, technological, and market developments —thereby safeguarding their interests, ensuring legal certainty, and fostering long-term, sustainable collaboration. In conclusion, the careful structuring of contractual clauses in international R&D agreements carried out in Brazil significantly maximize commercial and technological benefits while minimizing the probability of potential legal disputes. Therefore, companies and institutions must adopt a strategic and forward-looking approach from the very outset of negotiations, ensuring not only the legal soundness of the agreement but also the long-term success and sustainability of their collaborative innovation initiatives on the international stage. Authors: Talita Orsini de Castro, Isabela Zumstein Guido and Luiza Fernandes de Andrade.

It is known that intellectual property (IP) can be used as a policy tool during moments of geopolitical tension and commercial retaliation, particularly in the context of international disputes. Brazil’s new Law 15,122/2025 sets forth IP-related countermeasures that could affect licensing, royalties and tech transfer deals for global companies. Concerning Brazil, Law No. 12,270, enacted in 2010, was a legislative response to the need for domestic mechanisms to implement trade retaliation under the World Trade Organization (WTO) Dispute Settlement system. Its goal was to enable the Brazilian government to act, when authorized, against foreign violations of trade commitments, including by suspending obligations related to intellectual property rights. The law was introduced in the context of disputes such as the cotton case against the United States, in which Brazil sought to restore fair competition in the face of inconsistent agricultural subsidies. The idea of retaliating through the suspension of trade or IP concessions regained prominence after the European Union’s environmental import restrictions and later with the U.S. “Trump tariffs.” Therefore, Brazil enacted Law No. 15,122/2025, that authorizes the federal government to adopt countermeasures against countries or economic blocs that impose unilateral measures detrimental to Brazilian trade, investment, or competitiveness. This new legislation broadens the scope of retaliation by creating other procedures to enable the suspension of IP rights, the withholding of royalties and other commercial obligations — on an exceptional basis but without the procedure established by Law No. 12,270/2010. The law’s innovation lies not in enabling retaliation but in the process to implement such measures, with the tools made available to the Executive - now authorized to act not only after a WTO proceeding but also unilaterally and provisionally in response to foreign practices deemed harmful: restrictions on the importation of goods and services, suspension of commercial and investment concessions, and, in more sensitive cases, the suspension of obligations related to intellectual property. This may include, for example, the withholding of royalty payments or the suspension of protections for patents, trademarks, software, and other intangible assets held by foreign companies. This shift allows a more agile and strategic response to external regulatory pressure—especially where such measures affect Brazil’s trade exposure and economic sovereignty. While the law creates new possibilities for unilateral action in defense of national competitiveness, it also raises practical and diplomatic challenges. Unilateral countermeasures—especially involving intellectual property—could lead to claims of breach under the TRIPS Agreement and trigger retaliation or reputational damage. Thus, the use of such measures, especially those involving intellectual property rights, must be carefully weighed against potential disputes and reputational risks in international forums. The challenge lies in balancing national regulatory autonomy with the stability and predictability needed to support international trade and innovation ecosystems. Article 5 of the updated law sets out procedural safeguards for implementing trade countermeasures. It requires the government to regulate the process through public consultations, define clear timelines for the analysis of each case, and provide formal recommendations for possible retaliatory actions. These steps aim to ensure transparency, stakeholder engagement, and a structured decision-making process—particularly important when measures may affect sensitive areas such as intellectual property or access to foreign markets. Additionally, the law adds an important caveat: IP-related measures are to be treated as a last resort, only when other options prove inadequate. This recognizes the sensitive nature of IP in global supply chains and the potential fallout from targeting these rights in high-value sectors such as pharmaceuticals and technology. Nevertheless, given this scenario, it is imperative for companies — especially those operating across borders or with exposure to foreign IP portfolios— to review their intangible assets and strengthen their contractual and regulatory strategies. Adopting a proactive approach to legal compliance and risk management is essential to mitigate the potential effects of this legislation. Strategic measures may include reviewing licensing agreements, analyzing IP-related contractual clauses, and implementing dispute resolution mechanisms, while actively monitoring these developments and understanding the implications of potential countermeasures—actions that can offer greater legal certainty. Ultimately, Law No. 15,122/2025 highlights the need for prudent IP asset management and a robust legal protection strategy. [IP rights in Brazil; Law 15,122/2025 impact; Brazil trade countermeasures; Foreign intangible asset risk; Intellectual property compliance in Brazil] Talita Orsini de Castro Garcia Partner, Intellectual Property | [email protected] Isabela Zumstein Guido – Lawyer, Intellectual Property | [email protected]

Lawyers Enéias Queiroz Amorim and Fernanda de Almeida Prado Sampaio have just become partners at Finocchio & Ustra Sociedade de Advogados, a law firm with over 22 years of experience and recognized as one of the most influential in Brazil. With over 12 years of experience in the tax advisory practice, Enéias earned a law degree from Universidade Presbiteriana Mackenzie and a postgraduate degree in Tax Law from Instituto Brasileiro de Direito Tributário (IBDT). Throughout his career, he has advised large companies from different industries, such as pharmaceuticals, veterinary medicine, metallurgy, agronomy, automotive, food, transport, technology and services. Enéias, who was working as coordinator of our firm's tax advisory area, has extensive experience in tax special regimes, opportunities, planning, and compliance with indirect taxes. In the words of our tax specialist, becoming a partner at Finocchio & Ustra represents an important recognition and a new challenge. “The tax law practice is constantly evolving, and my goal is to continue helping our clients to have increasingly strategic and personalized support,” he emphasizes. Fernanda, also a specialist in Tax Law, graduated from Pontifícia Universidade Católica de Campinas (PUC) and has a postgraduate degree from Instituto Brasileiro de Estudos Tributário (IBET). Her broad experience in direct taxes, in particular, the Transfer Pricing project, tax planning, tax benefits arising from technological innovation and tax compliance, Fernanda, who also held the position of coordinator of our tax law area, takes over as partner of our firm, considering her achievement a significant milestone in her career. “I accept this responsibility with determination and reinforce my commitment to actively contribute to the growth of our firm and to excellence in delivering solutions to our clients,” she says.

Reinforcing its full-service practice, Luciana Moralles and Marcelo Schwartzmann are joining the firm’s team of partners Luciana Camponez Pereira Moralles and Marcelo Schwartzmann are the new partners at Finocchio & Ustra Sociedade de Advogados, a full-service corporate law firm that is recognized as one of the top influential firms in Brazil. About Luciana Camponez Pereira Moralles Specialized in Environmental Law, Sustainability and Regulation, she has over 25 years of experience in highly complex strategic cases. She outlines corporate law strategies and engages in environmental compliance processes. She is a professor in postgraduate and extension courses on carbon market, ESG and environmental management. Luciana, who already led the firm's environmental and regulatory area, has a Law degree from the São Paulo State University (UNESP, Franca campus) and specialized in Civil Procedure from University of Ribeirão Preto (UNERP) and holds a master's degree from UNESP. In addition, she has also completed her complementary international training in Transnational, Trade, Environment Law and Human Rights, at the University of Lucerne, Switzerland. “Becoming an environmental and regulatory partner at Finocchio & Ustra, especially at this time when sustainable practices are gaining prominence in society and among companies, is a reason for great joy and gratitude. This achievement is the result of a process built over the years, where my professional trajectory was consolidated side by side with the growth of our office. I am deeply grateful to everyone who accompanied me and helped me along this path. We grow together”, declares Luciana. About Marcelo Schwartzmann Marcelo is a lawyer specializing in Environmental and Regulatory Law with solid experience in top-tier law firms in Brazil and abroad (Germany and the United Kingdom). He has worked on complex cases, such as the Mariana/MG disaster, negotiations with indigenous peoples and transnational disputes before the High Court in London. In addition, he has experience in corporate governance, ESG (he worked on the Legal Committee of the Renova Foundation) and institutional relations. During his career, he also worked in the legal departments of multinational companies in the mining and energy sectors. Marcelo is a speaker and author of publications on legal and socio-environmental topics, such as environmental compliance, solid waste, forest code, indigenous and traditional communities, collective actions in environmental disasters, among others. He has a law degree from Mackenzie Presbyterian University, and specialized in Environmental Law and Strategic Management of Sustainability from Pontifical Catholic University of São Paulo (PUC-SP). He holds a Master's degree in Global Law from the Université Libre de Bruxelles (Belgium), an LL.M. in Legal Theory from the Goethe-Universität Frankfurt am Main (Germany), an MBA from Getulio Vargas Foundation and is currently studying an MBA in compliance & ESG at University of São Paulo (USP/ESALQ). “It is with great pleasure that I join Finocchio & Ustra as a partner and take the leadership of the Environmental and Regulatory Law area. This is a strategic moment for our firm, and I am committed to consolidating our performance as a reference in the segment by offering creative legal solutions aligned with the dynamic demands of the market and the highest quality standards”, highlights Marcelo. For José Luis Finocchio Junior, the firm’s founding partner, the arrival of Marcelo and Luciana as partners in the environmental area takes place at a strategic moment, in which companies and society must be increasingly aligned with environmental and regulatory guidelines. “The experience of our new partners strengthens our team and reinforces the delivery of customized solutions in new areas of environmental practice, such as mining and energy, always with the goal of adding value to our clients’ businesses,” he highlights.

The corporate and M&A team at Finocchio & Ustra Sociedade de Advogados advised Framework Digital, a technology company focused on digital transformation and innovation for large enterprises, in the acquisition of Rethink, a leading consultancy specializing in strategy, design, and digital product development. The transaction marks the integration of Rethink into the Framework ecosystem, giving rise to the new brand “Rethink by Framework.” This strategic combination creates a powerful player in the digital solutions market, with enhanced capabilities to deliver complex, high-impact projects and a comprehensive innovation portfolio. With the goal of reaching BRL 200 million in revenue over the next three years, the deal positions Framework to accelerate its growth trajectory and expand its presence both in Brazil and abroad, reinforcing its position as a key player in the corporate technology landscape. The deal was led by partner Felipe Cervone, alongside lawyers Rachel Marques, Camila de Godoy Ferreira, Júlia Savioli and Letícia Flaminio, with the participation of Enrico Abrahão Oliveira and Giovana Silva, all from Finocchio & Ustra.

“Moral damages” (“danos morais”, in Portuguese), refer to compensation awarded to individuals or entities that have suffered non-material harm, such as damage to reputation, violations of personal rights or emotional distress. Unlike purely financial losses, “moral damages” aim to redress intangible harm, ensuring that victims receive adequate reparation. This legal concept is deeply rooted in Brazilian civil law and is recognized by the Federal Constitution, the Civil Code, and several specific laws, such as the Consumer Protection Code and Environmental Law. The application of these types of damages is particularly relevant in consumer law, where Brazilian courts have been receptive to claims from individuals alleging personal harm due to issues such as defective products, delays in service delivery, improper charges, or failures in customer support. While consumer protection is a well-established principle in Brazil, excessive litigation and the broad interpretation of “moral damages” have led to concerns about abusive claims and the potential financial impact on businesses operating in the country. Companies often face lawsuits seeking high compensatory amounts, even in cases where the alleged damage is subjective or lacks significant impact. Also, the calculation and award of “moral damages” in Brazil is not straightforward. There are no fixed criteria or parameters to determine the amount of the compensation, which depends on the circumstances of each case, the degree of fault and harm, the economic situation of the parties, and the social and legal relevance of the right violated. The Brazilian courts have a wide discretion to assess and fix the value of these kind of damages, which can result in inconsistent and unpredictable outcomes. Therefore, discrepancies in court decisions have caused inconsistencies in awards, creating legal uncertainty for businesses. Some cases result in modest compensation, while others impose significant financial burdens on companies, especially in high-profile disputes. Moreover, the Brazilian legal system has witnessed a phenomenon known as the "moral damages industry", which consists of the abusive and frivolous use of lawsuits seeking compensation for trivial or nonexistent personal injuries. This practice not only overloads the judiciary, but also undermines the legitimacy and effectiveness of personal rights as a tool for social justice and human dignity. In order to prevent and combat the “moral damages industry”, the Brazilian courts have adopted some measures, such as dismissing manifestly unfounded claims, imposing sanctions on bad-faith litigants, and applying the principles of proportionality and reasonableness to moderate the amount of compensation. Given this complex legal landscape, foreign businesses operating in Brazil must be aware of the peculiarities and challenges of moral rights and damages in the Brazilian legal system. It is important for companies adopt proactive strategies to mitigate risks related to “moral damages”, by establishing clear contractual terms, implementing effective compliance mechanisms and ensuring high standards in consumer relations to prevent disputes. Additionally, close collaboration between clients and their legal counsel is essential to navigating judicial trends and setting realistic expectations in cases that involve personal injury, reducing both the frequency and value of moral damage awards. A strategic legal approach can be decisive in defending fair business practices and preventing companies from becoming targets of abusive or predatory lawsuits. Furthermore, the lawyer’s role is to guide businesses on how to handle allegations of “moral damages”, aiming to reduce the risks of high compensation and negative public exposure. By maintaining active engagement with the judiciary and aligning strategies with legal precedents, businesses can work toward ensuring that “moral damage” claims serve their intended purpose of fair reparation, rather than becoming a source of undue financial liability. Raïssa Simenes Martins Fanton, partner Luíza Pattero Foffano, lawyer

Brazilian regulation requires all companies, both national and foreign, registered in the National Registry of Legal Entities (CNPJ), to declare the existence or non-existence of an Ultimate Beneficial Owner (UBO) within thirty (30) days from the date of registration with the CNPJ, in accordance with the guidelines contained in the Normative Instruction No. 2119/2022, issued by the Federal Revenue Service. For the declaration purposes, the UBO is defined as the natural person who exerts control over a company or group, wielding the authority to make pivotal decisions and derive substantial benefit from its outcomes. An individual qualifies as a UBO if they possess more than 25% of the company’s share capital, whether directly or indirectly, or if they hold or exercise predominance in the company's decisions and have the power to elect the majority of its officers. Officers and directors of foreign companies who are not shareholders are not considered UBO, even if they have the power to elect the majority of the company’s officers. Foreign companies must declare their UBO or confirm its absence. In contrast, companies domiciled in Brazil only need to indicate the existence of a UBO, with no declaration required if no natural person qualifies as one. Among the documents that need to be submitted to the Federal Revenue Service for analysis is a corporate organization chart, as well as the equity interest of each shareholder. The purpose of the UBO declaration is to provide greater transparency, enabling the Federal Revenue Service to identify who controls a company and the source of the company’s funds, thereby helping to prevent illegal practices. However, some companies whose information is publicly available, and which are already subject to stricter regulation and control mechanisms, such as public companies or listed companies registered with the Securities and Exchange Commission (CVM), are not obliged to make this declaration. Failure to comply with this obligation or to provide supporting documentation may result in sanctions, including the suspension of the CNPJ, disrupting the company’s daily operations and preventing, among others, transactions with banking establishments, including the movement of current accounts, making financial investments and obtaining loans. The requirement to declare the UBO represents an advance in corporate governance and the fight against illicit practices in Brazil. The distinction between national and foreign companies reflects the Federal Revenue Service's concern with corporate structures used for tax evasion and asset concealment. Compliance with this obligation ensures fiscal regularity and transparency, strengthening integrity in the business environment. Therefore, companies must pay attention to deadlines and requirements to avoid penalties that could compromise their operations in Brazil. Andrea Ometto Bittar Tincani, partner Camila de Godoy Ferreira, lawyer Júlia Bueno da Conceição, lawyer Giovana Silva, intern

In today’s global economy, trademarks are no longer mere identifiers — they are core business assets that influence brand equity, consumer loyalty, and competitive positioning. For companies operating in Brazil, a jurisdiction that balances formal legal procedures with complex market realities, brand protection must be comprehensive and forward-thinking. Registering a trademark with the Brazilian National Institute of Industrial Property (INPI) provides foundational legal protection and exclusive rights; however registration alone is insufficient. To effectively safeguard trademarks in Brazil, companies must embrace a proactive strategy that includes market monitoring, contractual diligence, and preventive dispute resolution. These elements together build a shield against infringement, reduce litigation risk, and reinforce investor and consumer trust. Beyond Registration: The Value of Vigilant Monitoring Trademark enforcement in Brazil begins with formal registration, but its long-term efficacy depends on continuous vigilance. Regular monitoring of the market and newly filed trademark applications is essential to detect potential infringements at an early stage. Identifying risks early allows rights holders to adopt preemptive strategies, such as sending cease-and-desist letters, before reputational or financial damage occurs. This early intervention not only mitigates risk but also strengthens the company’s negotiating position and reinforces its reputation as a rights-conscious market player. In many instances, well-timed administrative actions can deter infringers without escalating to court, saving valuable time and resources. Strategic Use of Negotiation to Avoid Litigation Litigation is often costly, time-consuming, and unpredictable. In Brazil’s legal environment, where proceedings can be long, companies are increasingly turning to negotiation and structured agreements as primary tools for conflict avoidance. One key mechanism is the coexistence agreement, particularly relevant in industries where brand similarities are common. These agreements clearly define boundaries of use, helping businesses avoid consumer confusion and legal disputes while enabling both parties to operate without interference. Controlled trademark licensing is another effective strategy. When contracts are drafted with precise usage clauses, quality control requirements, and supervisory rights, they allow for expansion through third parties while maintaining brand integrity. Improperly monitored licensing, on the other hand, can result in brand dilution or reputational harm — risks that preventive legal drafting can eliminate. Similarly, non-disclosure agreements (NDAs) are indispensable during commercial negotiations, mergers, partnerships, and new product launches. NDAs protect sensitive, commercial, and technical information, deter opportunistic conduct, and uphold a company’s competitive advantage. Contractual Oversight and Third-Party Compliance Brand reputation can be compromised by the actions of third-party distributors, franchisees, or business partners. For this reason, companies must routinely audit and review contracts involving brand use to ensure alignment with internal standards and trademark guidelines. Clauses relating to brand usage, communication protocols, quality benchmarks, and oversight mechanisms should be clearly stated and contractually binding. This preventive diligence ensures that partners uphold the brand’s values and aesthetic identity while minimizing legal exposure due to unauthorized or negligent behavior. Leveraging Alternative Dispute Resolution and Institutional Support Even when preventive measures are in place, disputes may arise. In such cases, companies should favor alternative dispute resolution (ADR) mechanisms such as mediation or arbitration, especially when time and brand reputation are at stake. ADR provides a confidential, efficient, and commercially sensible alternative to litigation and is widely recognized in Brazil. Moreover, partnering with Brazilian enforcement authorities can significantly enhance brand protection. Joint actions with entities such as the Federal Revenue Service, consumer protection agencies (Procon), and state civil police forces have proven effective in combating counterfeiting and illicit trade. These collaborations help companies intercept infringing goods and disrupt illegal distribution networks across key regions. A Framework for Long-Term Value Protection Companies that implement a robust, business-oriented trademark strategy in Brazil benefit from enhanced legal certainty, market resilience, and reputational strength. The most successful approaches are those that combine legal enforcement with strategic foresight — blending proactive monitoring, clear contractual safeguards, and skilled negotiation. In a legal and commercial environment as dynamic as Brazil’s, the ability to prevent disputes before they arise is not just a legal tactic, but a competitive differentiator. For global businesses, effective brand protection is a long-term investment — one that supports growth, mitigates risk and reinforces trust in the marketplace. Luis Felipe Dalmedico Silveira – Partner, Intellectual Property and Strategic Negotiation | [email protected] Isabela Zumstein Guido – Lawyer, Intellectual Property | [email protected] Mariane Ferri – Lawyer, Strategic Negotiation | [email protected]

The data center market in Brazil is currently experiencing significant growth. With the increasing use of artificial intelligence and cloud applications,having larger and more powerful data centers has become not just strategic, but a critical necessity. This applies to both in-house operations and outsourced services. Brazil offers clear advantages for establishing data centers. Data centers require properties with substantial areas, which demand access to telecommunications infrastructure and high levels of security. They also require considerable amounts of energy to ensure operational stability. Brazil has a favorable mix, including a strong capacity for energy generation—primarily from renewable sources such as wind and solar—and the availability of large plots in developed urban centers (which meet the aforementioned infrastructure and security needs). Thus, there is a sort of “gold rush” when it comes to acquiring properties suitable for data center operations in Brazil. Real estate operations have a well-known characteristic: they are non-renewable assets, meaning once a property is allocated for a specific use, it is no longer available for other purposes. As a result, properties capable of housing data centers have become an attractive investment option. Some of the most used contractual arrangements to accommodate data center operations include: Property leases (with or without an option to purchase); Built to suit; Sale and leaseback; Surface rights; Real estate partnerships between property owners and data center operators (with profit sharing); Property sales. The choice of one option over another depends on various factors, such as the scale of the project, the intended use (in-house or outsourced operations), availability of financing (especially in sale and leaseback and built-to-suit arrangements), and other considerations. Authors: Luis Felipe Dalmedico Silveira, partner Maria Vitória Resende Alves de Queiroz Telles, lawyer Gabriel Cano Sartori, lawyer  

Recently, Brazilian legal system underwent a significant reform due to the enactment of Law No. 14,905/2024, published on July 1, 2024. This Law amended, among other provisions, Articles 389 and 406 of Law No. 10,406/2002, the Brazilian Civil Code, and also to adopt the Selic rate, excluding the IPCA/IBGE index rate, as the default legal rate for late payment interest in cases where no agreement exists between the parties. The enactment of Law No. 14,905, of 2024 represents a pivotal moment in Brazilian law, as it resolves a longstanding legislative and doctrinal dispute regarding the determination of late payment interest in the absence of explicit agreement. Previously, the legal framework lacked clarity, leaving room for two possible interpretations: one supports the application of a maximum rate of 1% per month under Article 161, paragraph 1 of the National Tax Code (CTN), while the other advocates for using the Selic rate as a standard for monetary adjustment. In 2019, this debate reached the Superior Court of Justice of Brazil (STJ) via Special Appeal No. 1,795,982. The case centered on whether the rate of 1% per month or the Selic rate should prevail. In its decision, published on October 23, 2024, the STJ was inclined to conclude that the Selic rate should prevail. The majority of the court reasoned that the 1% rate under Article 161, paragraph 1 of the CTN pertains exclusively to tax-related debts, while Article 406 of the Civil Code specifically links default interest to the rate applicable for federal tax arrears—a role fulfilled by the Selic rate. Given this uncertain scenario of legal uncertainty and aiming to harmonize interpretations, Law No. 14,905/2024 was enacted. The Law amended Articles 389 and 406 of the Civil Code, formally adopting the Selic rate—minus the IPCA index rate—as the default interest rate in cases without a contractual stipulation. This new rule has been effective since September 2024. While the Law clarifies the applicable rate, it delegated the calculation methodology to the Central Bank of Brazil (Bacen). On August 29, 2024, Bacen issued National Monetary Council (CMN) Resolution No. 5,151, which specifies, in Article 2, the formula for calculating the legal rate. According to the resolution, the monthly Selic and IPCA-15 percentages from the preceding month should be used, applying simple interest for capitalization. To facilitate compliance, Bacen has made an electronic tool, the Citizen's Calculator, available for public use. This tool simplifies the computation of default interest rates in accordance with the new legal standards. However, debates surrounding the default interest rates persists. On April 17, 2024, a draft bill to amend the Civil Code was presented in the Senate Plenary, proposing to set a default interest rate between 1% and 2% per month. While its chances of approval appear remote, its passage could reshape the current framework and reignite legislative discussions. For now, in the absence of an express agreement between the parties, the Selic rate minus the IPCA applies as the default rate, calculated in accordance with Bacen's prescribed formula and monthly disclosed percentages. Legal practitioners should, however, remain vigilant for future regulatory updates and developments regarding the proposed draft bill, as they may significantly alter the determination of default interest rates. Authors: Talita Orsini de Castro Garcia, partner Ana Letícia Fagundes, lawyer Chiara Prupere Giovaneti, lawyer

The corporate and M&A team of Finocchio & Ustra Sociedade de Advogados assitsted Aoop Soluções Digitais Ltda., a technology company specialized in hyperautomation, service design and cloud digital experiences, focused on ServiceNow, in an M&A transaction with NTT Data Business Solutions Participações S.A., a multinational corporation from the technology sector. As a result of the transaction, Aoop joins NTT Data group, and, with the partnership, the companies aim to expand their business not only in Brazil, developing innovative digital solutions. The transaction was conducted by partner Felipe Cervone alongside lawyers Camila de Godoy Ferreira, Letícia Flaminio and Júlia Cristina Arruda Savioli, with the participation of Enrico Abrahão Oliveira, all from Finocchio & Ustra's corporate and M&A team.  

The corporate department of Finocchio & Ustra Advogados advised Comedix Comércio de Cosméticos Ltda. e CMX Comércio e Distribuição Ltda., which develops its activities in the cosmetics market, in the purchase and sale of assets of Comedix and CMX Ltda. to Bio Brands Franchising Gestão de Marcas Ltda. The Transaction was led by Rachel Cerqueira Salvador Marques, corporate and mergers and acquisitions team’s coordinator, with the participation of Patrícia Bruzzi Carrion Paraguay, Sérgio Ribeiro Fernandes and Maria Eduarda Granchelli Oude Groenige, all from Finocchio e Ustra Advogados.  

The corporate team of Finocchio & Ustra Advogados advised the quotaholders of CQA Comercial Química Americana Ltda.,a company that operates in the sector of laboratory products and equipment, in the transaction of sale of 100% of its equity interest to Calibre Scientific Brasil Ltda., a company of products and equipment for laboratory research, diagnostics and biopharmaceuticals. The acquisition of CQA is aligned with the expansion strategy adopted by Calibre Scientific. As a result of the transaction, Calibre Scientific, which is today a reference in the market, expands its solution portfolio acting and area of activity, aiming to lead, thus, the consolidation of this market segment. The transaction was conducted by the Andrea Tincani, partner of the corporate and mergers & acquisitions team, with the participation of Arthur Carvalhaes, Carolina Bueno, Tainara Sanzovo and Beatriz Fonseca, all from Finocchio & Ustra Advogados.  

Abstract: Brazil's Ministry of Finance has received 113 applications from betting companies seeking to operate in the country starting in 2025. Companies must pay 30 million reais for a five-year license and meet requirements under Law No. 14,790/2023, including having a Brazilian headquarters and implementing measures to prevent money laundering. Text: The Secretariat of Prizes and Betting (SPA) of the Ministry of Finance has received 113 applications for authorization from 108 betting companies wishing to operate in Brazil starting in January 2025. Companies that obtain authorization will be required to pay 30 million reais to operate three brands for five years. In addition, they must comply with the requirements established by Law No. 14,790/2023, including: Having headquarters and administration within Brazilian territory; Having a Brazilian citizen as a partner holding at least 20% of the company's share capital; Designating a director responsible for the relationship with the Ministry of Finance; Designating a director responsible for customer service and the ombudsman; Implementing internal policies, procedures, and controls to prevent money laundering, terrorism financing, and the proliferation of weapons of mass destruction; Implementing internal policies, procedures, and controls to ensure the integrity of betting and prevent match-fixing and other types of fraud; Promoting responsible gaming and preventing gambling disorders. Brazil led the world in access to sports betting sites in 2022[1], and recent data indicates that Brazil was the 3rd highest consumer of betting globally in 2023[2]. Author: Guilherme Cremonesi Bruno Henrique dos Santos Henrique Zigart Pereira Footnotes [1] https://www.poder360.com.br/poder-sportsmkt/esportes/brasil-lidera-acessos-a-sites-de-apostas-esportivas-em-2022/, acessado em: 29/08/2024. [2] https://www.poder360.com.br/poder-sportsmkt/esportes/brasil-lidera-acessos-a-sites-de-apostas-esportivas-em-2022/, acessado em: 29/08/2024.

Corporate restructurings have become increasingly common in the Brazilian business landscape, driven by the need to adapt to a dynamic and competitive economic environment. In this context, the assignment of preemptive rights, safeguarded by the Brazilian Corporations Law, emerges as a valuable strategic tool for shareholders and companies. Preemptive Rights and Assignment The preemptive right is an essential right of shareholders guaranteed by the Brazilian Corporations Law. This right ensures that shareholders have the opportunity to subscribe to new shares issued by the company in the event of a capital increase, in proportion to the number of shares they hold. The purpose of this prerogative is to protect shareholders’ proportional participation and prevent the dilution of their shares. However, paragraph 6 of Article 171 of the Brazilian Corporations Law provides shareholders with strategic flexibility by allowing them to assign their preemptive rights to third parties. This assignment can occur either with or without compensation, enabling shareholders to transfer their preemptive rights to other shareholders or non-shareholders. As highlighted by jurists, preemptive rights are incorporated into the shareholder’s assets at the moment the general meeting deliberates on the capital increase. From that moment on, shareholders are fully free to negotiate their rights within the time frame established by the company’s bylaws or the general meeting, which cannot be less than 30 days. Assignment of Preemptive Rights in Corporate Transactions The assignment of preemptive rights can play a central role in corporate restructuring, especially in mergers, acquisitions, or capital increases with the admission of new investors. This assignment can facilitate the admission of strategic new investors into the company’s capital, promoting a realignment of interests and contributing to the reorganization of the corporate structure. This can be particularly useful in situations where companies seek to attract shareholders who bring not only financial resources but also expertise and synergies for business development. Shareholder Protection and Respect for the Principle of Equality It is important to emphasize that the assignment of preemptive rights can only occur after the capital increase is approved by the general meeting. This ensures that the principle of equality is preserved, guaranteeing that all shareholders will have the opportunity to participate in the decision and exercise their preemptive rights on equal terms. Therefore, the assignment of preemptive rights after the approval of the capital increase by the general meeting is the mechanism that balances the interests of all parties involved, ensuring transparency and fairness in the process. Final Considerations The assignment of preemptive rights emerges as a versatile tool in corporate restructuring, allowing shareholders greater flexibility while also offering the company an opportunity to attract new investors. When used effectively, this strategy can create new opportunities for all those involved and contribute to more efficient, adaptable corporate management aligned with the strategic interests of shareholders and companies. Authors: Camila de Godoy Ferreira Carolina Bueno de Oliveira Zogaeb Tainara Morata Sanzovo Jéssica Nader

The Corporate and M&A department of Finocchio & Ustra Advogados advised A. Azevedo Óleos, a Brazilian company which operates in the vegetable oils and derivatives manufacturing sector. in the M&A transaction with Oleon, a multinational corporation operating in the natural base oleochemicals sector. As a result of the Transaction, Oleon enters the Brazilian market and, alongside A. Azevedo Óleos, will expand the company´s business in Brazil and internationally in the natural base oleochemicals sector. The Transaction was led by Andrea Ometto Bittar Tincani and Felipe Cervone, partners of the Corporate and M&A team, with the lawyers Rachel Cerqueira Salvador Marques, Leticia Flaminio Oliveira, and Marcela Steckelberg Nicoletti, all from Finocchio e Ustra Advogados.  

On October 3, 2024, Brazil introduced Medida Provisória No. 1.262, aligning its tax regulations with the OECD’s Global Anti-Base Erosion (GloBE) Rules.This is part of the Inclusive Framework on Base Erosion and Profit Shifting (BEPS), which establishes a minimum effective tax rate (ETR) of 15% for large multinational enterprises (MNEs). Key Features of the Legislation: Adoption of a 15% Minimum ETR: The legislation introduces an additional Contribuição Social sobre o Lucro Líquido (CSLL) to ensure that MNEs operating in Brazil meet the 15% minimum effective tax rate on global profits, as required by the OECD’s GloBE rules. Scope: The rules apply to Multinational Groups with entities in Brazil and with annual consolidated revenues of €750 million or more, making these groups subject to the GloBE minimum tax regulations, similar to those implemented in other G20 and OECD countries. Calculation of the Effective Tax Rate (ETR): The ETR is calculated as the ratio of Adjusted Covered Taxes (taxes paid on income and profits) to GloBE Income (global book profits), expressed as a percentage. If the ETR in a particular jurisdiction is below 15%, the difference will be collected through an additional CSLL in Brazil. The formula for calculating the Additional CSLL in Brazil is: Additional CSLL = (15% - ETR) x GloBE Income (in Brazil). Key Takeaways: Government Initiative: Unusually, the Brazilian government has issued both the executive order (Provisional Measure) and specific regulations simultaneously, indicating a strong commitment to getting this approved swiftly. Legislative Process: The Provisional Measure must be approved by Congress. If passed in 2024, these rules will take effect on January 1, 2025. OECD Guidelines: OECD commentary and guidelines have been included as interpretation framework for the new rules. Impact on MNEs: Multinational corporations (MNCs) with business in Brazil will need to reassess their Effective Tax Rate (ETR), as calculated under the new provisions. Impact on Tax Incentives and Planning Strategies: Several tax incentives and planning strategies widely utilized in Brazil may be significantly affected, including: SUDENE/SUDAM incentives, Goodwill amortization, Interest on Net Equity (INE), R&D incentives, New government grant tax credit mechanisms. Link to the Provisional Measure here: https://www.in.gov.br/web/dou/-/medida-provisoria-n-1.262-de-3-de-outubro-de-2024-58815820 Author: Bruno Marques Santo

The corporate team at Finocchio & Ustra Sociedade de Advogados advised Elsys, a well-established technology company with 35 years of experience,on the acquisition of a stake in dtLabs, a startup incubated at Unesp Bauru, specializing in the development of artificial intelligence solutions. As a result of the transaction, Elsys and dtLabs, which will keep their operational independence, commit to drive innovation in sectors such as agribusiness, retail, security, logistics, smart cities, industries, and mining, among others, by developing and commercializing new solutions and positioning Brazil as a significant global player in the sector. The partnership combines Elsys's strong presence in the domestic market with dtLabs's expertise in software development for the implementation of AI solutions. The transaction was led by Andrea Ometto Bittar Tincani, corporate and mergers and acquisitions team’s partner, with the participation of Camila de Godoy Ferreira, Gabriela Caroline Ramos Silva, Júlia Cristina Arruda Savioli and Enrico Abrahão Oliveira, all from Finocchio e Ustra.  

The adoption of alternative dispute resolution mechanisms has proven to be an effective strategy to ensure the successful execution of public contracts. Countries like the United States, the United Kingdom, and Australia widely use dispute boards, achieving a significant reduction in the number of litigations that reach the courts, in addition to promoting faster conflict resolution. International experience shows that adopting these committees not only prevents disputes but also ensures the continuity of works without the interruptions typical of judicial processes, thus guaranteeing the delivery of projects within the scheduled time and budget. In Brazil, Dispute Boards (DBs) emerge as an innovative and efficient solution, aligning the country with international best practices and demonstrating Brazil's commitment not only to efficiency but also to the transparency and modernization of its public works. They have already been applied in some large-scale projects. Notable examples include the construction of São Paulo's Yellow Line 4 subway, stadium renovations for the 2014 World Cup, and some highway projects. With the advent of the new Brazilian law that sought to update public procurement processes (Law No. 14133/2021), which includes the possibility of using Dispute Boards as a form of conflict resolution, several public infrastructure projects have already been implementing Dispute Boards with notable success. Highways, railways, and urban projects have benefited from the use of this tool, resolving contract execution disputes effectively and ensuring the continuity and quality of the works. In this regard, the ANTT (National Land Transport Agency — In Brazil), responsible for regulating the activities of federal railway and highway infrastructure exploration and the provision of land transport services in Brazil, has been one of the pioneering agencies in promoting and regulating DBs in Brazilian Public Administration. Accordingly, the ANTT approved Normative Resolution No. 6040/2024, which establishes clear guidelines for the implementation of DBs, intending not only to resolve potential conflicts between the agency and its regulated entities in highway and railway concession contracts but also to prevent possible disagreements. The Dispute Board is a dispute resolution tool that appoints three (3) experts of recognized technical and professional competence related to the contract's subject and the dispute, who have no conflicts of interest in the case. These experts must be capable of resolving disputes of a technical nature that involve rights with economic value that can be freely transacted by the parties, such as: a) the adequacy of works and services to regulatory compliance and/or contract agreements; b) the execution of the works and services themselves; c) the assessment of events that may impact the fulfillment of contractual obligations and the calculation of their financial impacts, among others. Specifically, in ANTT's resolution, the composition of the DB committee includes one member appointed by ANTT, one by the concessionaire, and a third member, who will serve as the president, mutually agreed upon by the other appointees. It is worth noting that the Dispute Board can also address disputes related to facts connected to these issues, which may even favor the prevention of future litigation. However, it cannot rule on the validity of ANTT's supervisory acts or regulations or strictly legal issues. Moreover, unlike arbitral decisions, DB decisions are not final, meaning they can be changed before the Judiciary or an Arbitral Tribunal, in the case of contracts with an arbitration clause. Thus, currently valid concession contracts can be amended through an addendum to include the option of Dispute Boards as an alternative for resolving future disputes. For existing disputes, there is no need for a contract addendum to implement a DB, as ANTT's resolution allows for the creation of a Dispute Board through an independent instrument to be signed between the agency and the concessionaire. Authors: Bárbara Fernandes and Luiz Felipe Fogo, Contracts Lawyers

The expatriation of employees is a common practice for companies looking to expand their operations abroad or meet international demands, becoming increasingly prevalent due to globalization. However, this process requires special attention to the legal obligations imposed by Law No. 7,064/82, which regulates the transfer of employees abroad. Understanding the specifics of this legislation is essential to ensure that workers' rights are respected and to avoid legal issues. One of the main considerations when planning expatriation is determining whether the transfer will be temporary or permanent. This decision directly impacts the rights and obligations of both the company and the employee, the maintenance of the employment relationship in Brazil, and the application of labor and social security regulations. This is because Law No. 7,064/82 establishes that the international transfer of Brazilian workers must comply with the most favorable regulation to the employee, whether from Brazilian law or the destination country’s law. This means that during expatriation with a temporary intent, the company must ensure the rights provided for in Brazilian law, such as FGTS (Unemployment Compensation Fund), INSS (Brazilian Social Security Institute), 13th salary, vacation with an additional one-third, and the transfer allowance, which can be 25% or another amount agreed upon in the contract. The payroll may undergo some adjustments depending on the company's policy and the destination country's laws. Salaries and benefits may be adjusted according to the cost of living in the country to which the employee is being transferred. Managing payroll for expatriates is a multifaceted task that requires attention to detail and a deep understanding of international laws and regulations, ensuring a successful and satisfying expatriation experience for the employee. Taxation can vary depending on the country of origin and the destination country, especially considering that Brazil has social security agreements with several countries. There may also be a need for adjustments in withholding tax according to fiscal and international laws. On the other hand, if the transfer is permanent, the company may proceed with the employee’s contract termination in Brazil, followed by hiring abroad. In this case, all severance payments will be due, and there will no longer be an employment relationship with the local subsidiary. Another crucial point that often raises questions in expatriation is the management of benefits during expatriation. Generally, these benefits are agreed upon in the offer letter and may include airfare, life insurance, moving costs, and other aspects negotiated with the employee. Additionally, after two years abroad, in the case of temporary transfers, the employee is entitled to a vacation in Brazil with all expenses covered by the company, as provided by law. As observed, the expatriation of employees requires detailed planning and strict compliance with the regulations established by Law No. 7,064/82. The company must ensure that all employee rights are respected, from the payment of benefits to the guarantee of return to Brazil, if necessary, depending on the temporary or permanent nature of the expatriation. Compliance with these obligations not only avoids legal issues but also ensures a smoother and safer expatriation process for all parties involved. Authors Veridiana Police, Labor and Social Security Advisory Partner; Victor Campana, Labor and Social Security Advisory Lawyer; Fernanda Florêncio, Labor and Social Security Advisory Consultant.