{"id":27125,"date":"2021-09-30T15:33:42","date_gmt":"2021-09-30T18:33:42","guid":{"rendered":"https:\/\/www.plbrasil.com.br\/impacts-of-law-14-195-21-business-environment-law-on-corporate-law\/"},"modified":"2026-09-03T15:25:52","modified_gmt":"2026-09-03T18:25:52","slug":"impacts-of-law-14-195-21-business-environment-law-on-corporate-law","status":"publish","type":"post","link":"https:\/\/plbrasil.com.br\/en\/impacts-of-law-14-195-21-business-environment-law-on-corporate-law\/","title":{"rendered":"The Business Environment Law seeks to facilitate economic activity in Brazil"},"content":{"rendered":"

Law 14.195\/21<\/a>, which was nicknamed the Business Environment Law, with orignated in Provisional Measure 1040\/21. Its sanction by the Presidency of the Republic, took place on August 26, with 37 vetoes. among them the passage that dispensed with the issuance of an Annotation of Technical Responsibility (ART) or equivalent document for works. and exemption from IPI on vehicles purchased by a person with a disability and from offsetting the presumed credits of the Contribution to PIS\/Pasep and Cofins. <\/span><\/p>\n

 <\/p>\n

Similar to the Economic Freedom Law, Law 13.874\/19, it is a legislative diploma that promotes changes in different sectors of the legal system.<\/p>\n

 <\/p>\n

Among the changes that came into force, we mention those that facilitate the constitution and operation of legal entities and the development of activities:<\/p>\n

i) the unification of federal, state and municipal tax registrations in the National Register of Legal Entities (CNPJ);<\/p>\n

ii) the maintenance of the electronic system by the bodies involved in the process of registering and legalizing companies, so that the entrepreneur can previously consult the viability of the address where the company will be installed and the availability of the business name;<\/p>\n

iii) the use of the national risk classification of activities by states and municipalities that do not have their own classification; and<\/p>\n

iv) automatic granting, without human analysis, of operating permits and licenses to companies involved in medium-risk activities.<\/p>\n

In addition, it is important to mention the prohibition of charging, in the company\u2019s registration process, data or information that already appears in the federal government\u2019s databases; the expansion of the powers of the general meetings of publicly-held companies, in which minority shareholders may decide on the sale of company assets in excess of 50% (fifty percent) of total assets; the extension of the deadlines for calling general shareholders\u2019 meetings, from 15(fifteen) for thirty (30) days; the prohibition, in publicly-held companies, of the accumulation of functions between the company\u2019s main director and the chairman of the board of directors; the possibility of electing non-resident natural persons as Managers of Corporations (Company or Sociedade An\u00f4nima (S\/A), as long as they are appointed in Brazil as an Attorney with powers of summons.<\/p>\n

 <\/p>\n

In line with some of these important changes, we mention art. 41 of Law No. 14,195 which establishes that \u201cindividual limited liability companies existing on the date of entry into force of this Law will be transformed into single-person limited liability companies regardless of any change in their articles of incorporation\u201d.<\/p>\n

 <\/p>\n

Created in 2011, Individual Limited Liability Company (EIRELI) was a microenterprise model that contemplated entrepreneurs not included in the Individual Microentrepreneur (MEI) model, due to the type of activity or limitations on annual revenue.<\/p>\n

 <\/p>\n

To facilitate entrepreneurship in Brazil, the Sociedade Limitada Unipessoal (SLU) was established by the Economic Freedom Law (13.874\/2019) and provided another option for the entrepreneur who wanted to establish a business with individual performance.<\/p>\n

 <\/p>\n

To some extent, the figure of EIRELI, was already with its relevance reduced due to the simplified discipline of the SLUs, which had characteristics very similar to those of the EIRELI, but did not establish the mandatory minimum share capital of 100 minimum wages in force.<\/p>\n

 <\/p>\n

The tacit transformation of EIRELI to SLU will be carried out automatically, and in principle, it does not require any kind of attitude by the entrepreneur, but on the other hand, it makes it possible to reduce the capital of the transformed company, due to the absence of mandatory minimum share capital.<\/p>\n

 <\/p>\n

On September 9, 2021, the Ministry of Economy (ME) published the Official Letter SEI No. 3510\/2021\/ME, containing guidelines on filing, which must be followed by all Boards of Trade in the country:<\/p>\n

1. Inclusion in the registration form of the individual limited liability company of the information \u201cautomatically transformed to a limited liability company, pursuant to article 41 of Law 14,195, of August 26, 2021\u201d;<\/p>\n

2. Wide disclosure by the Boards of Trade regarding the extinction of EIRELI and about the possibility of creating a SLU, as well as the impossibility of filing documents for the incorporation of new EIRELIs;<\/p>\n

3. At\u00e9 o envio de novo of\u00edcio por parte do Departamento Nacional de Registro Empresarial e Integra\u00e7\u00e3o (DREI), as Juntas Comerciais dever\u00e3o realizar normalmente o arquivamento de altera\u00e7\u00f5es e extin\u00e7\u00f5es de EIRELI.<\/p>\n

<\/div>\n","protected":false},"excerpt":{"rendered":"

Law 14.195\/21, which was nicknamed the Business Environment Law, with orignated in Provisional Measure 1040\/21. Its sanction by the Presidency of the Republic, took place on August 26, with 37 vetoes. among them the passage that dispensed with the issuance of an Annotation of Technical Responsibility (ART) or equivalent document for works. and exemption from IPI on vehicles purchased by a person with a disability and from offsetting the presumed credits of the Contribution to PIS\/Pasep and Cofins.   Similar to the Economic Freedom Law, Law 13.874\/19, it is a legislative diploma that promotes changes in different sectors of the legal system.   Among the changes that came into force, we mention those that facilitate the constitution and operation of legal entities and the development of activities: i) the unification of federal, state and municipal tax registrations in the National Register of Legal Entities (CNPJ); ii) the maintenance of the electronic system by the bodies involved in the process of registering and legalizing companies, so that the entrepreneur can previously consult the viability of the address where the company will be installed and the availability of the business name; iii) the use of the national risk classification of activities by states and municipalities that do not have their own classification; and iv) automatic granting, without human analysis, of operating permits and licenses to companies involved in medium-risk activities. In addition, it is important to mention the prohibition of charging, in the company\u2019s registration process, data or information that already appears in the federal government\u2019s databases; the expansion of the powers of the general meetings of publicly-held companies, in which minority shareholders may decide on the sale of company assets in excess of 50% (fifty percent) of total assets; the extension of the deadlines for calling general shareholders\u2019 meetings, from 15(fifteen) for thirty (30) days; the prohibition, in publicly-held companies, of the accumulation of functions between the company\u2019s main director and the chairman of the board of directors; the possibility of electing non-resident natural persons as Managers of Corporations (Company or Sociedade An\u00f4nima (S\/A), as long as they are appointed in Brazil as an Attorney with powers of summons.   In line with some of these important changes, we mention art. 41 of Law No. 14,195 which establishes that \u201cindividual limited liability companies existing on the date of entry into force of this Law will be transformed into single-person limited liability companies regardless of any change in their articles of incorporation\u201d.   Created in 2011, Individual Limited Liability Company (EIRELI) was a microenterprise model that contemplated entrepreneurs not included in the Individual Microentrepreneur (MEI) model, due to the type of activity or limitations on annual revenue.   To facilitate entrepreneurship in Brazil, the Sociedade Limitada Unipessoal (SLU) was established by the Economic Freedom Law (13.874\/2019) and provided another option for the entrepreneur who wanted to establish a business with individual performance.   To some extent, the figure of EIRELI, was already with its relevance reduced due to the simplified discipline of the SLUs, which had characteristics very similar to those of the EIRELI, but did not establish the mandatory minimum share capital of 100 minimum wages in force.   The tacit transformation of EIRELI to SLU will be carried out automatically, and in principle, it does not require any kind of attitude by the entrepreneur, but on the other hand, it makes it possible to reduce the capital of the transformed company, due to the absence of mandatory minimum share capital.   On September 9, 2021, the Ministry of Economy (ME) published the Official Letter SEI No. 3510\/2021\/ME, containing guidelines on filing, which must be followed by all Boards of Trade in the country: 1. Inclusion in the registration form of the individual limited liability company of the information \u201cautomatically transformed to a limited liability company, pursuant to article 41 of Law 14,195, of August 26, 2021\u201d; 2. Wide disclosure by the Boards of Trade regarding the extinction of EIRELI and about the possibility of creating a SLU, as well as the impossibility of filing documents for the incorporation of new EIRELIs; 3. At\u00e9 o envio de novo of\u00edcio por parte do Departamento Nacional de Registro Empresarial e Integra\u00e7\u00e3o (DREI), as Juntas Comerciais dever\u00e3o realizar normalmente o arquivamento de altera\u00e7\u00f5es e extin\u00e7\u00f5es de EIRELI.<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1409],"tags":[1502,933,1396],"class_list":["post-27125","post","type-post","status-publish","format-standard","hentry","category-corporate-services-2","tag-business-environment-act","tag-junta-comercial","tag-lei-14-195-21"],"yoast_head":"\nBusiness Environment Law: What You Need to Know<\/title>\n<meta name=\"description\" content=\"Discover the key changes introduced by the Business Environment Act and how they affect companies in Brazil.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/plbrasil.com.br\/en\/impacts-of-law-14-195-21-business-environment-law-on-corporate-law\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"The Business Environment Law seeks to facilitate economic activity in Brazil\" \/>\n<meta property=\"og:description\" content=\"Discover the key changes introduced by the Business Environment Act and how they affect companies in Brazil.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/plbrasil.com.br\/en\/impacts-of-law-14-195-21-business-environment-law-on-corporate-law\/\" \/>\n<meta property=\"og:site_name\" content=\"Grupo PLBrasil - 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