PRACTICE

AREAS

AGRIBUSINESS


Agribusiness in Brazil has been expanding rapidly, with transactions reaching over USD 500 billion a year. Besides being a highly regulated market area, public subsidies play an essential role in the industry. De Faro Caraciolo provides professionals specialized in customized legal solutions for agribusiness clients, focusing on the following areas:

• Corporate structuring and business restructuring;

• Tax and corporate planning;

• Typical agrarian contracts (rural leasing and rural partnership);

• Unusual agrarian contracts (contracts for the sale and purchase of crops, as well as others related to agricultural production, livestock, and pasture);

• Tax advisory and litigation (administrative and judicial) focused on agribusiness;

• Labor advisory and litigation (administrative and judicial) focused on agribusiness;

• Rural financing;

• Consultancy in real estate law focused on rural property and litigation (administrative and judicial) related to this type of property (procedures related to registration, environmental issues, INCRA, etc.).




ARBITRATION


In the past 4 years, arbitration chambers in Brazil have handled disputes that involved USD 10 billion. The number of cases submitted to arbitral proceedings in the country has grown rapidly, and companies and their lawyers increasingly accept the solution for the composition of conflicts between the parties. Brazil has legislation that equates arbitral and judicial decisions. However, some situations can weaken the choosing of arbitration for the resolution of conflicts, such as flaws in the wording of the arbitration clause, which may take the dispute to the Court, as well as problems regarding the execution of decisions issued by arbitral chambers, including regarding the guarantees posted in Brazil. De Faro Caraciolo has professionals specialized in providing customized legal solutions for arbitration, focusing on the following areas:

• Drafting and reviewing of arbitration agreements and clauses;

• Representation in arbitration proceedings in Brazil or abroad;

• Support to ensure compliance with arbitration awards in Brazil and abroad;

• Disputes related to several law practices, such as: corporate law, M&A, business law, banking law, public law (concessions, PPP), antitrust, civil construction, oil and gas, telecommunications, among others.




CONTRACTS


Personalized and well-structured contracts are the best way to start all forms of business relationships. The drafting of proper guarantees, rights, obligations, fines, among others, is fundamental to guarantee an effective contract. De Faro Caraciolo has extensive experience in assisting and supporting our clients, from drafting contracts, to legal assistance in negotiating civil and commercial contracts. Our international team provides counsel in disputes across a range of jurisdictions, in addition to Brazil, with expertise in local contractual culture, guaranteeing our clients strength and effectiveness while elaborating contractual issues. De Faro Caraciolo has professionals specialized in the contractual area, allowing its customization, highlighting:

• Contracts for the sale and purchase of real estate properties;

• Global contracts for the provision of goods and services;

• Technology transfer and technology contracts;

• Real guarantee contracts (mortgages, pledges, etc.) and personal guarantee (sureties and others);

• Distribution, agency, and commercial representation contracts;

• Entertainment, sports, and advertising contracts;

• E-commerce and internet contracts;

• Supply, cost sharing, turn-key and other contracts.




SPORTS LAW


In recent years, transactions involving Brazilian sports players have generated more than USD 440 million. Since this type of transaction started to be registered by the Central Bank of Brazil in 1993, the profits with transactions has been estimated at over USD 2 billion. The main destination for Brazilian sportspeople is Europe, followed by China. Sportsmen are predominantly football players. However, there has been an increase in the number of basketball and volleyball players. Recently, the International Football Federation - FIFA has changed its rules on economic rights over athletes. These rights now can only be held by sports organizations, and, in the case of Brazil, by football clubs. In the legislative field, there is a trend to demand greater transparency and the implementation of good management practices by these entities. Therefore, the progressively increase of costs, the amounts paid by the sponsors, the right to broadcast games, as well as the increase in the exploitation of the brands, has led the teams to seek corporate structures that allow the implementation of methodology throughout their organization and enable the reception of investors, offering contractual guarantees and legal assurances. This scenario explains the great increase in the last years in the number of corporate sports entities, which have abandoned the associative model. De Faro Caraciolo is one of the pioneers in the implementation of business structures for sports, besides having professionals specialized in providing customized legal solutions focused on the following areas: Structuring corporate and contractual solutions for sports organizations (such as football clubs), always focused on financial and fiscal efficiency, for receiving investments, allowing investors' compensation (national or foreign), ensuring legal certainty in the relationship established. Implementation of corporate governance structure and legal solutions to enable greater efficiency in the management of sports activities.

• The formation of international business structures to negotiate sports palyers focused on financial and fiscal efficiency;

• Preparation of tailored contracts for sportspeople;

• Tax and social security consultancy for athletes (in Brazil and abroad), as well as administrative and judicial counsel;

• Labor disputes involving sportspeople;

• Drafting of agency contracts and other related contracts;

• Execution of commissions for agents with national and international bodies (such as FIFA/CAS)




CORPORATE


Corporate problems require specialized legal advice for companies or economic groups during all stages of their activity. Also, to better accommodate their partners' interests, business structures often require expansion in Brazil and abroad. On the other hand for corporate life management. Formal aspects decide approximately 75% of the corporate disputes that are filed with Brazilian Courts. Our professionals have extensive experience in the corporate management of large national and international economic conglomerates, which allows us to ensure full support in matters of this nature, avoiding conflict situations, providing support in legal strategy for the defense, or future corporate disputes. According to the best and current commercial practices, De Faro Caraciolo established a multidisciplinary group dedicated to analyze different aspects in the corporate area. Our expertise covers the organization of all types of legal means, obtaining all the necessary documentation, licenses, authorizations and records. De Faro Caraciolo has specialized legal professionals in the corporate area, allowing a customized service, highlighting:

• Drafting of bylaws, articles of association, shareholders' agreement, memorandum of understanding, regulation of investment funds in equities, joint venture contracts, consortia, trust deeds, etc. (paralegal services, such as registration and obtaining permits, or operating licenses);

• Corporate secretary (for meetings, board meetings, executive board, etc.), with legal support to corporate management, including in Private Pension Entities;

• Support in negotiations and conflicts between partners (administrative, before CVM, Bovespa, etc.), in Court and/or arbitration;

• Expertise in the regulatory sphere with CVM, Bacen, Susep, Bovespa, regulatory agencies, etc. (publication of relevant facts, information to the market, support to meet the different levels of corporate governance, for specific markets on Bovespa; requirements before Bacen and Susep; registration of portfolios before CVM and Bacen; and administrative defenses, etc.);

• Creation of corporate governance policies, disclosure of relevant facts, SOX rules, etc.;

• Structuring, managing stock option plans;

• Support in negotiations with target companies/businesses, including due diligence;

• Preparation of debenture deeds, collateral guarantees, etc.,

• Legal counsel for national and international companies in business structuring and restructuring, in the preparation of business plans and initial feasibility studies focused on legal and financial aspects.




MERGERS AND ACQUISITIONS


De Faro Caraciolo is involved continuously in structuring and restructuring a range of industry branches, from pharmaceuticals, mining companies, energy distributors, companies in the financial, insurance, retail, service providers, technology, to civil construction, among others. Our M&A team advises buyers and sellers throughout the process. We have extensive experience in tax, corporate planning, legal support in negotiations, and revision of procedures for identification of liabilities, among others. Our office's multidisciplinary performance assures our clients complete protection from all angles, allowing safe basis for their perfect decision-making process. De Faro Caraciolo has highly qualified professionals to provide solutions and support to our customers, focusing on:

• Representation of clients in M&A cases, including acquisitions, mergers, split-offs, and reorganizations in Brazil and abroad;

• Preparation and support in the negotiation of commercial agreements involving associations, alliances, joint ventures, companies, and other types of negotiations;

• Advice and legal counsel in corporate matters, including organization, management, and reorganization of legal entities, as well as counseling related to board of directors and tax meetings, board's meetings, partners' meetings, shareholders' meetings, debenture holders, etc.;

• Preparation of memoranda, legal opinions, and other guidelines related to compliance with corporate and commercial regulations, including companies with capital registered with the Brazilian Securities Commission (CVM).




REAL ESTATE


De Faro Caraciolo is continuously involved in legal counsel in the development and implementation of real estate projects, in addition to structured transactions. The firm has experience in dealing with purchase, sale and leasing operations and structuring real estate investment funds, securitizing real estate receivables. Our firm has professionals specialized in providing customized legal solutions, focusing on:

• Analysis, negotiation, and preparation of real estate legal documents, including commitments and deeds of sale and purchase, exchanges, donations in payments, guarantees, real estate development, contract, construction, lease, sale-leaseback, built to suit, rural lease, surface law, real estate conference for companies;

• Structuring of real estate development projects, including subdivisions, shopping malls, hotels and flats, residential, industrial condominiums, hospitals, and time-sharing contracts;

• Real estate due diligence;

• Assessment of deeds, records, and annotations in the real estate registry offices, regularization and obtaining licenses, city hall permits, at INCRA and other competent bodies;

• Preparation and evaluation of real guarantees, such as chattel mortgage and mortgage lending;

• Consultancy in the sale of rural properties, including to foreigners.




INTERNATIONAL


Brazil is the 7th largest economy in the world. The domestic market has been driven by government income distribution programs, with 36 million people having access to the consumer market. Countless foreigners choose to start their activities independently, which allows them to implement their organizational culture fully. In this case, in addition to the necessary understanding of the Brazilian market's specificities, bureaucracy ends up being one of the biggest obstacles to its entry into this market. On the other hand, many partnerships between foreigners and Brazilians, given cultural differences, fail despite strong commercial potential. Individualized legal counsel is essential for foreign companies and Brazilian companies that establish partnerships to succeed in their activities. De Faro Caraciolo provides specific solutions, both for Brazilians and foreigners, with emphasis on the following services:

• Initial feasibility study, focusing on tax, labor, and financial costs, including business plan, creation of tailor-made legal means (ensuring legal certainty, tax efficiency, and reduction of financial costs);

• Support in obtaining tax benefits; work and stay visas;

• Legal support in the negotiation and drafting of Joint Venture contracts, operational agreements, and partnerships, alerting to possible situations of conflict due to cultural and normative differences;

• Consultancy and legal cousel for Brazilian companies for investment abroad;

• Representation of Brazilian or foreign clients in matters related to investments in Brazil.




CAPITAL MARKETS


The São Paulo Stock Exchange (BOVESPA) is the 13th largest exchange globally, with USD 1.3 trillion in market capitalization, with USD 15 billion being raised in 2013 alone. Investment funds have a volume of USD 1 trillion, accounting for a 15%-growth per year. Basic interest rate in Brazil (SELIC) is at an upward trend, exceeding 11% per year, making this one of the leading markets for fixed income funds globally, expanding the interest of foreign investments. The Brazilian capital market has several types of funds, from equity investments, real estate, infrastructure, to public financing bonds, etc. There are favorable rules for receiving foreign investment through investment funds, which may be exempt from taxes on capital gains and, even for Brazilians, such a tax on the sale of assets may be deferred. Such advantages require prior planning, even before the start of negotiations for investment or sale of assets. De Faro Caraciolo has professionals specialized in advising and in the capital market area, as follows:

• Structuring of investment funds for business groups, or individuals, with a view to greater tax efficiency;

• Legal audit;

• Securitization of assets (operations with guarantees);

• Procedures before BACEN and CVM (legal structure for public and private offers, issuance of debentures, subscription bonuses, etc.);

• Assistance to foreign investors, from obtaining licenses, registrations in Brazil, to legal support for Brazilian target companies' negotiations.




COURT-SUPERVISED REORGANIZATION


Although Brazil has maintained significant growth rates in recent years, there has been a slowdown since 2010. As a result, there is an increase in the number of bankruptcy filings and petitions for court-supervised reorganization. Also, some studies indicate that about 70% of companies in Brazil fail after 5 years of their creation. Companies experiencing cash flow difficulties need to act quickly, with the utilization of the proper methods, to avoid bankruptcy. On the other hand, when clients start delaying payments or file a petition for court-supervised reorganization, the lender's strategic and agile action is essential. Otherwise, the recovery of such receivables tends to be seriously compromised. Adequate and immediate legal support is the safest way to negotiate with creditors or to recover these values. De Faro Caraciolo has professionals specialized in providing personalized legal solutions in matters of court-supervised reorganization, bankruptcy and debt composition, whether clients are debtors or creditors, focusing on the following areas:

• Contractual composition of debts, postponing the payment of installments falling due, or facilitating the recovery of credits by the creditor;

• Elaboration of a business recovery plan, to be presented in court, avoiding bankruptcy;

• Defense in bankruptcy proceedings;

• Extrajudicial recovery plan for negotiation with creditors and debt arrangement without the need for Court intervention.




ASSET PLANNING


According to Forbes magazine, since 2010, Brazil has had 47 new billionaires, and in 2014 the number of Brazilians on the list of such magazine was 65. This increase is due to Brazil's rapid growth, which, despite the slowdown since 2010 and recent indicators, remains strong. Also, it is necessary to consider the growing and constant inflow of venture capital, which adds value to the operations carried out and requires greater structuring. In this way, estate planning has become a highly demanded type of legal service.

De Faro Caraciolo has professionals specialized in the elaboration of customized structures for estate planning, focusing on the following aspects:

• Structuring and restructuring of family business groups, aiming for greater efficiency in the investments made;

• Implementation of a business plans and corporate governance rules for family businesses;

• Tax, social security and succession planning (Trust institution, Foundations, etc.);

• Consultancy in family law.




INTELLECTUAL PROPERTY


Issues related to Intellectual Property require specialized legal assistance to support companies and individuals. Our expertise includes advising in the registration and intellectual protection, including filing, follow-up with the INPI, as well as administrative and judicial defense of disputes involving trademarks, intellectual or industrial property. De Faro Caraciolo has professionals specialized in providing customized legal solutions within the scope of intellectual property law, focusing on the following areas:

• Negotiation and advice for the correct fulfillment and protection of intellectual property contracts;

• Legal counsel on the license and registration of trademarks, patents, know-how, among others, including analysis, preparation, and application for registration of a technology transfer contract;

• Feasibility research for intellectual property registration requests, preparation of registration requests, extrajudicial notifications, challenges, and administrative resources;

• Analysis, negotiation, preparation, and registration of franchise contracts;

• Analysis of copyright infringements and defense for the protection of copyright;

• Legal counsel on unfair competition including intellectual and industrial property and domains on the internet and corporate name.




REGULATORY


In the early 1990s, Brazil has privatized some industries operated exclusively by the State, such as telecommunications, basic sanitation, energy, transportation, oil and gas, and mining. Thus, a new set of rules and regulatory agencies were developed, which, together with the existing ones, formed a new Brazilian regulatory framework. Thus, the filing of all registrations, certificates, permits, licenses, among others is vital for companies operating in these areas. Otherwise, they are unable to operate in these markets. De Faro Caraciolo has professionals specialized in providing legal customization solutions focused on the following areas:

• Assistance in bidding (competition, contracts, price surveys and letters of invitation), including administrative and judicial litigation (objections, appeals, etc.), from the analysis of notices, during the bidding process to the analysis of the entire administrative contract;

• Assistance to public and private clients in the development of projects and execution of administrative contracts involving public service concessions and public-private partnerships - PPP;

• Preparation of opinions on issues related to Brazilian Public Law in general, covering regulatory, constitutional, and administrative Law;

• Obtaining and renewing operating licenses and other administrative authorizations with public entities and regulatory agencies, including certification of products and equipment, regularization of company records at their establishments, obtaining import licenses, etc.




TAX


According to the World Bank, the Brazilian tax system is one of the most complex in the world. Approximately 10% of the laws enacted in Brazil refer to taxation. Brazil has about 60 types of taxes, 1.5% of the revenue of companies operating in the country is spent on tax documentation to comply with local tax legislation. Taxation is one of the biggest obstacles for companies in Brazil. Municipalities, State and Federal governments grant different tax benefits to encourage national and international investments, increasing the economy in Brazil's most diverse locations. Understanding the tax specificities and opportunities that exist is fundamental to the rapid growth in the country. De Faro Caraciolo has specialized and highly trained professionals to provide customized solutions focusing on:

• Consultancy in direct and indirect taxes (complete legal counsel for the management of national and foreign companies);

• Administrative and judicial tax litigation;

• Counsel on labor and social security contributions;

• Consultancy on transfer pricing;

• International taxation (including for agreements to avoid double taxation, as well as the use of tax benefits from Mercosur);

• Taxation of individuals (legal counsel to Brazilians and foreign executives);

• Tax Planning (organization and corporate restructuring with a view to greater tax efficiency);

• Recovery of taxes, credits and review of fiscal bookkeeping (learn more).