On Monday, all eyes in Brazil were transfixed on the political whirlwind created by President Jair Bolsonaro’s apparently impromptu cabinet reshuffle. And while Mr. Bolsonaro’s antics usually divert attention away from news stories that are harmful to the president or his family, yesterday was an exception. In fact, Mr. Bolsonaro’s ministerial merry-go-round actually took the spotlight off a notable achievement for the government, in what was one of the administration’s most pro-business moves to date.
President Bolsonaro signed a broad provisional decree aimed at slashing red tape for business owners, making it easier for entrepreneurs to open companies and protecting minority shareholders’ rights in publicly-traded companies. Each and every one of the decree’s articles intends to reduce the bureaucratic burden on businesses in Brazil and improve legal security.
Judicial inefficiency and insecurity has long been a roadblock to doing business in Brazil, with courts taking too long to reach verdicts and lacking uniformity in their interpretation of the law. As we showed in our March 18 Daily Briefing, a report by the OECD says overhauling the court system would boost investment in Brazil.
While not quite a full court reform, Mr. Bolsonaro’s decree seeks to bring more consistency to business-related litigation.
Key points in Bolsonaro’s pro-market decree
- One-stop shop. Currently, the process to create corporate ID numbers — called CNPJs in Brazil — is currently spread across three levels of government. This will now be unified, cutting the ten-step procedure of opening a company into just...
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