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Types of Business Organizations - Chapter 2 - Doing Business in Brazil
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Introduction
2.101 Law No. 10406 of January 10, 2002, which came into force on January 11, 2003, instituted the new Brazilian Civil Code, repealing Law No. 3071 of 1916 (the former Civil Code) and the First Part of Law No. 556 of 1850 (the Commercial Code), as well as Decree No. 3708 of 1919, which regulated Brazilian limited liability companies (sociedades por quotas de responsabilidade limitada). The companies already existing must adapt themselves to the New Civil Code until January 11, 2005. New companies have to be organized in accordance with the rules of the New Civil Code.
2.102 Under the former Civil Code, companies were classified as commercial or civil (if they carried out commercial or merchant activities, in the first case and, by exclusion, companies engaged in all other activities, in the second case). The new Civil Code makes no distinction between civil and commercial companies, which are now classified as entrepreneurial or non-entrepreneurial companies, depending on whether their activities are organized for the production of goods or services through the coordination of production factors, and carried out on a routine and systematic basis.
2.103 Entrepreneurial activities include, but are not limited to, commercial activities. An entrepreneurial activity is much broader than a commercial one, since it involves any production activity for the circulation of goods or services in an organized and professional fashion, and not merely an intermediation in the purchase and sale of goods.
Pinheiro Neto - Advogados, established in 1942, is Brazil's leading commercial law firm with offices in Sao Paulo, Rio de Janeiro and Brasilia. The founding Editor of this publication, the late J.M. Pinheiro Neto, was the Legal Advisor to the British Chamber of Commerce in Brazil.
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