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International Investors (institutions and individuals) are allowed to hold any asset class available to domestic investors in Brazil.
According to the CMN (Brazilian Monetary Council) Resolution 2689, since international investors are not established or resident in the country, it is necessary to hire an institution to act as:

Legal Representative

Responsible to present all the registration information of the investor to the Brazilian Authorities. When the representative is an individual or a non-financial corporation, the investor must indicate a financial institution duly authorized by the Central Bank that will be jointly and severally responsible for the representative's obligation.

Fiscal Representative

Responsible for taxes and fiscal issues on behalf of the investor before the Brazilian Authorities.

Custodian

Responsible to hold updated reports and control all the assets of the international investor in segregated accounts, and provide this information anytime it is required, to the Authorities and to the investor.
The financial assets and securities traded as well as other forms of financial applications must be registered, held in custody or maintained in deposit accounts at an appropriated authorized institution authorized by the CVM or Central Bank.

Step-by-Step:

1 – Choose a legal representative, a fiscal representative and a custodian. Actually, several financial institutions are authorized by the CVM and Central Bank to perform the custodian activities and can also act as investor's legal and fiscal representatives.

2 – The Custodian will sign a contract with the Investor and will ask for detailed information attending the Brazilian legislation of “Know your Customer”.

3 – Apply for the investors' operational code. The Custodian is also responsible for the application of the investor's Operational Code to the CVM. In 24 hours maximum, CVM will reply with the so-called CVM Code. Simultaneously CVM will request to the IRS (Brazilian Internal Revenue Services) an investor's CNPJ ( Legal Entity Federal Taxpayer Registry).

4 – The funds brought into Brazil are subject to electronic registration at the Central Bank in declaratory form. The initial Electronic Declaratory Entry – RDE and subsequent updates are an obligatory requisite for movement across the foreign exchanges and must be obtained before such movements can take place. The representative is responsible for the registration of such operations.

5 – Choose a BOVESPA's brokerage firm that will be your representative at BOVESPA and will execute your orders.

International investments in equity instruments are tax exempt on capital gains and on CPMF. Investments from countries that do not tax income or where tax rates are lower than 20% are taxed as domestic investors. There is no minimum permanence period requirement for the investments in Brazil.

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