Open Company Brazil Foreigner: LTDA vs SA vs EIRELI 2026

You’re planning to open a business in Brazil — whether you’re a digital nomad launching a local consultancy, an investor eyeing retail opportunities, or an entrepreneur relocating your startup. The first big question you face is straightforward but consequential: which corporate structure should you choose?

The short answer is this: for 95% of foreign investors setting up a company in Brazil, the LTDA (Sociedade Limitada) is the right choice. It’s simpler, cheaper, faster to establish, and carries far fewer ongoing compliance obligations than the SA (Sociedade Anônima). The SLU (Sociedade Limitada Unipessoal) — a single-owner variant of the LTDA — is the natural fit for solo entrepreneurs.

The EIRELI, once a popular vehicle for single-person companies, has been largely eclipsed by the SLU and the MEI (Microempreendedor Individual) regime. Meanwhile, the SA remains essential only for publicly traded companies, regulated sectors like banking and insurance, and ventures preparing for institutional funding rounds.

In this article, we compare the three structures head-to-head with real 2026 costs, registration timelines, and practical considerations specifically relevant to foreigners. If you want a comprehensive roadmap covering visas, taxes, and immigration requirements alongside company formation, see our complete guide to doing business in Brazil as a foreigner. For a hands-on walkthrough of the LTDA registration process, check our detailed LTDA setup guide.

Which Company Types Are Available to Foreigners in Brazil?

Brazil offers four primary corporate structures to foreigners, though only three are actively used today: the LTDA (Sociedade Limitada), the SA (Sociedade Anônima), the SLU (Sociedade Limitada Unipessoal), and the now largely obsolete EIRELI (Empresa Individual de Responsabilidade Limitada). Under Law 9.507/1997, which governs the LTDA framework, foreigners enjoy the same rights as Brazilian citizens regarding company formation, ownership percentages, and liability protection.

The key distinction among these vehicles lies in governance structure, capital requirements, shareholder rights, and ongoing regulatory burden. Understanding these differences upfront saves months of reorganization later — converting an SA back to an LTDA, for example, triggers new registration fees and potential tax implications.

LTDA (Sociedade Limitada): Open company brazil foreigner

The LTDA is Brazil’s workhorse business entity. Governed primarily by Articles 1,048 through 1,087 of the Civil Code (Lei 10.406/2002), it combines limited liability with maximum operational flexibility. There is no statutory minimum capital — though practical considerations (including investor visa requirements) typically suggest a minimum of R$ 10,000 to R$ 50,000.

Foreigners commonly use the LTDA for import/export operations, consulting firms, technology startups, franchise operations, and retail businesses. It accommodates both Brazilian and foreign partners equally, and ownership can be freely transferred through a simple contract amendment registered at the local Junta Comercial (commercial registry).

SA (Sociedade Anônima): Open company brazil foreigner

The SA is the corporate structure equivalent of a U.S. corporation or a UK plc. Governed by Lei 6.404/1976, it issues shares (ações) rather than partnership quotas (quotas). The SA comes in two flavors: closed (fechada), with a limited number of shareholders, and open (aberta), which is publicly traded and subject to rigorous SEC-equivalent oversight by the CVM (Comissão de Valores Mobiliários).

Minimum capital for a closed SA is R$ 100,000 divided into at least 100 shares. An open SA requires R$ 500,000 minimum. The governance requirements are steep: mandatory board of directors for larger companies, formal shareholder meetings, detailed financial disclosures, and independent auditor appointments.

SLU (Sociedade Limitada Unipessoal)

The SLU was introduced by Law 12.441/2011 as a streamlined single-owner version of the LTDA. Unlike the old EIRELI, it carries no minimum capital requirement. The sole owner enjoys limited liability identical to a multi-member LTDA, and unlike the EIRELI (which restricted each person to one company), you can establish multiple SLUs under the same owner.

For solo foreign investors — a digital nomad launching a consultancy or an entrepreneur testing a market — the SLU is typically the cleanest option.

EIRELI (Empresa Individual de Responsabilidade Limitada)

The EIRELI was created by Lei 12.441/2011 as the original single-person corporate vehicle. Its defining feature was a mandatory minimum capital equal to 100 times the national minimum wage. In 2026, with the minimum wage at approximately R$ 1,518, this translates to roughly R$ 151,800 — a substantial sum locked in the company with no return mechanism until dissolution.

Today, the EIRELI exists only in legacy registrations. New entrants should consider the SLU instead. Some investors still ask whether converting an existing EIRELI to an SLU is worthwhile — the answer is usually yes, given the capital liberation.

How Do the Three Company Types Compare? A Side-by-Side Breakdown

Here’s how the three active structures stack up across the dimensions that matter most to foreign investors in 2026. The LTDA wins on simplicity and cost; the SA dominates only for scale and public fundraising; the SLU is optimal for solo operators.

Feature	LTDA	SA	SLU
Minimum capital	No legal minimum	R$ 100,000 (closed) R$ 500,000 (open)	No legal minimum
Minimum partners	2 (or 1 = SLU)	2	1
Foreign ownership	100% allowed	100% allowed	100% allowed
Governance	Flexible; managed by sócios	Mandatory board structure	Same as LTDA
Setup cost (lawyer + registration)	R$ 3,000–R$ 8,000	R$ 15,000–R$ 40,000+	R$ 3,000–R$ 8,000
Annual compliance	Low	High	Low
Tax regimes available	Simples Nacional, Lucro Presumido, Lucro Real	Lucro Presumido, Lucro Real	Simples Nacional, Lucro Presumido, Lucro Real
Best for	Most foreign businesses	Public offerings, large ventures	Solo foreign investors

The numbers tell the story clearly. An LTDA setup in São Paulo typically runs R$ 5,000 to R$ 10,000 including legal fees, government registration, and the CNPJ (National Corporate Tax ID) application through the Receita Federal (Brazilian IRS). An equivalent SA setup starts at R$ 15,000 and climbs quickly with mandatory legal and accounting support.

What Are the Tax Regime Options for Each Company Type?

Brazil’s tax system for companies offers three principal regimes: Simples Nacional (simplified regime for small businesses), Lucro Presumido (presumed profit), and Lucro Real (actual profit). Your choice depends on revenue, company structure, and whether you qualify as Brazilian-owned.

Under Simples Nacional, annual revenue must stay below R$ 4.8 million, and the company must be majority Brazilian-owned (more than 50% of capital held by Brazilians or Brazilian-controlled entities). This is a critical restriction for foreign investors: if your LTDA is 100% foreign-owned, you cannot access Simples Nacional and must choose between Lucro Presumido or Lucro Real.

Lucro Presumido applies a presumed profit margin to gross revenue (typically 8% for services, 12% for commerce) before calculating income tax. Effective tax rates range from 14% to 23% depending on the PIS, COFINS, CSLL, and IRPJ combination. This regime is straightforward and popular among service-oriented foreign businesses.

Lucro Real calculates tax on actual net profit, with full deduction of legitimate expenses. It’s mandatory for companies exceeding R$ 78 million in annual revenue and often advantageous for businesses with significant deductible costs (importers, manufacturers, tech companies with heavy R&D spend).

How Do You Set Up an LTDA or SLU as a Foreign Investor?

Setting up an LTDA or SLU as a foreigner involves seven core steps, taking approximately 2 to 4 weeks depending on the state’s commercial registry workload and whether you need an in-person appearance at the Receita Federal.

• Step 1: Obtain a CPF (individual taxpayer number) if you don’t already have one. This takes 10–15 minutes at the Receita Federal or through a Brazilian consulate abroad.
• Step 2: Draft the contrato social (articles of association) — a legal document specifying company purpose, capital contributions, partner rights, and management rules. Foreign-language documents must be translated by a certified translator in Brazil.
• Step 3: Register the contrato social at the state Junta Comercial (commercial registry). Most states now offer online registration via platforms like Junta Comercial de São Paulo.
• Step 4: Obtain the CNPJ through the Receita Federal website. The application is free and typically processed within 24–48 hours.
• Step 5: Register with the municipal cadastro técnico for your city’s business tax (ISS). Required for service providers; varies by municipality.
• Step 6: Open a corporate bank account. Brazilian banks often require an in-person visit by at least one partner. Expect 1–3 weeks for approval.
• Step 7: Register employees with the eSocial system and obtain labor registration (CTPS) for any hired staff.

For detailed step-by-step instructions, including document templates and state-specific requirements, consult our LTDA setup guide.

What Are the Key Advantages and Disadvantages of Each Structure?

Every corporate structure carries trade-offs. The LTDA’s flexibility is also its vulnerability — if poorly drafted, partner disputes can paralyze the company. The SA’s governance rigor protects shareholders but at significant cost. The SLU’s simplicity becomes a liability if you later bring in co-founders.

LTDA: Strengths and Weaknesses

• Pros: Simple formation (2–4 weeks), low setup cost (R$ 3,000–R$ 8,000), flexible management, limited liability, dividend tax exemption for individuals (Lei 12.973/2014), easy transfer of ownership
• Cons: Requires 2 partners unless converted to SLU, partnership disputes can stall decisions if not properly addressed in the contrato social, some banks view LTDA structures with suspicion for large transactions

SA: Strengths and Weaknesses

• Pros: Attracts institutional investors, scalable governance, clear shareholder rights, recognized internationally, required for IPOs
• Cons: High minimum capital (R$ 100,000+), expensive setup and maintenance, complex compliance, mandatory audits, public disclosure requirements for open SAs

SLU: Strengths and Weaknesses

• Pros: Single-owner simplicity, no minimum capital, same liability protection as multi-member LTDA, unlimited SLUs per person, lower costs than EIRELI
• Cons: Sole decision-maker risk (no partner checks and balances), some banks and suppliers prefer multi-owner structures, may signal instability to certain investors

What Changed in 2026 Regarding Foreign Company Formation?

The landscape for foreign company formation in Brazil remains largely stable in 2026, with three notable developments worth tracking.

First: The Receita Federal has accelerated CNPJ processing through the centralized online portal, reducing average issuance time from 5–7 business days to 24–48 hours for standard applications. However, applications involving foreign partners without a Brazilian CPF still experience longer processing due to additional verification requirements.

Second: Several states have implemented unified commercial registry platforms that allow online contrato social filing with integrated CNPJ generation. São Paulo’s JUCESP platform now processes 80% of LTDA formations entirely online, cutting registration time by half.

Third: The Brazilian Congress is debating amendments to Law 13.445/2017 (the Migration Law) that would simplify investor visa pathways tied to company formation. While no definitive changes have passed as of early 2026, the proposed reforms could reduce the minimum investment threshold for an investor visa from R$ 500,000 to R$ 200,000, making company formation more attractive for mid-tier foreign investors.

For updates on regulatory changes, monitor the Receita Federal’s official announcements and the Ministério do Trabalho’s immigration portal.

Frequently Asked Questions About Company Formation in Brazil

Can a foreigner own 100% of a Brazilian company?

Yes. Brazilian law permits 100% foreign ownership of LTDA, SA, and SLU companies. There are no restrictions on the percentage of capital held by non-residents. This differs from some countries that impose foreign ownership caps on strategic sectors. The only exception is in certain regulated industries — such as aviation, maritime shipping, and media — where foreign ownership limits may apply under sector-specific legislation.

Do I need a Brazilian partner to open an LTDA?

No. You can be the sole foreign partner, or you can bring in a Brazilian co-founder. If you prefer not to involve a Brazilian partner, the SLU (single-owner LTDA) is your cleanest option. If you choose a traditional two-partner LTDA, Brazilian law requires at least two individuals or legal entities as partners — they can both be foreigners.

How long does company registration take in Brazil?

A standard LTDA registration takes 2 to 4 weeks from the initial consultation with your attorney to CNPJ issuance. The commercial registry filing itself usually completes in 3–5 business days. The CNPJ application through the Receita Federal typically processes within 24–48 hours. Corporate bank account opening adds another 1–3 weeks. Total timeline: approximately 3–6 weeks for a complete setup, assuming all documents are in order.

Is a lawyer required to form a company in Brazil?

Brazilian law doesn’t formally require a lawyer for LTDA or SLU formation, but practically speaking, you absolutely need one. The contrato social is a legal instrument that must comply with the Civil Code and state commercial registry requirements. Errors in drafting can invalidate the company structure, expose you to personal liability, or prevent you from accessing favorable tax regimes. All Brazilian lawyers must be registered with the OAB (Ordem dos Advogados do Brasil), and foreign-qualified attorneys cannot practice Brazilian corporate law.

Can I convert between company types after formation?

Yes, but conversions trigger specific legal procedures and costs. An LTDA can be converted to an SA through a formal amendment to the contrato social, approved by all partners and registered at the commercial registry. An EIRELI can be converted to an SLU if the owner obtains permanent residency (removing the citizenship restriction). Conversions typically cost R$ 2,000–R$ 5,000 and take 1–3 weeks. Tax implications should be evaluated before proceeding.

What happens if I don’t maintain my company properly?

Neglecting corporate formalities in Brazil can carry serious consequences. Failure to file annual tax returns triggers fines starting at R$ 150 per month per obligation. Ignoring labor obligations can result in personal liability for directors under Article 135 of the Tax Code (CTN). Abandoning a company without formal dissolution leaves the owner personally liable for all outstanding debts. Always engage a Brazilian accountant for ongoing compliance.

Ready to Choose the Right Company Structure for Your Business in Brazil?

Selecting the correct corporate structure is one of the most consequential decisions you’ll make when establishing yourself in Brazil. Get it right, and your business foundation will be solid for decades. Get it wrong, and you’ll spend years untangling avoidable legal and tax complications.

For 95% of foreign investors, the LTDA or SLU is the optimal starting point. But your specific circumstances — nationality, residency status, intended business activity, and growth ambitions — may push you toward a different structure. The best approach is to consult with a bilingual Brazilian lawyer who understands both your home country’s expectations and Brazil’s Civil Law system.

Navigating Brazilian corporate law as a foreigner can be daunting. Our bilingual legal team at Ribeiro Cavalcante Advocacia has helped hundreds of international investors, digital nomads, and entrepreneurs establish compliant, well-structured businesses in Brazil since 2015. We handle everything from company formation and tax optimization to immigration compliance and ongoing regulatory matters.