The Normative Ordinance No. 1634 enacted on May 6th, 2016 by Brazilian Federal Revenue Service (IRS) requires that any Brazilian or non-Brazilian entity holding real estate, bank accounts, stock or investments in Brazilian financial and capital markets and share interest in Brazilian Companies, among other forms of investments must disclose information regarding its ownership chain up to the individuals identified as Ultimate Beneficiary Ownership (“UBO”). As defined in article 8, §1º and §2º, of the Normative Ordinance, the UBO is (are) the one(s) that (i) ultimately, direct or indirectly, owns, control or exercise a meaningfully influence on the entity holding more than 25% of the owners’ capital or ensure preponderance in the Company’s decision-making process; (ii) on behalf of whom the transaction is conducted by/for.

In order to ensure the good standing of legal entities’ register data, the Companies must consider the date when they were enrolled with the IRS in order to define the term for its regularization: Companies enrolled up to  July 1st, 2017 must declare and present the relevant documentation of the individuals identified as Ultimate Beneficiary Ownership and its personal data up to December 31st 2018, while companies enrolled after said date must declare the UBO information and documentation within 90 days of its enrollment.

Failure of declaration of the UBO or presentation of the correct information is subject to suspension of the National Corporate Taxpayers Registration and will be prevented to transact with banks, even to operate bank accounts in Brazil and entering into loan agreements.

Our attorneys of corporate law are available for any further information.

The full text of IN 1634/2016 is available in Portuguese only at: RFB, IN 1634/ 2016