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An expat is, by definition, someone who does not live in their own country, temporarily or permanently.  Today, most international companies have at least a percentage of their workers who are currently living in another country.

 

In business, having expats allow for companies to control their international subsidiaries closely, improving their synergy on a global level. However, having a foreign employee often becomes much more expensive than hiring a local – the salary of those professionals usually is raised in order to accommodate for greater costs of living and the hassle of moving countries.

 

Even so, planning an international approach becomes impossible without the existence of expats – their work is essential to coordinate a new branch or to reform an older one. To reduce the problems with immigration, companies often use what is called a “trial period”, where a professional is allocated internationally for a short period of time, in order to test waters regarding adaptation and culture. In Brazil, the law allows for nationals of most countries[1] to enter   the Brazilian territory for the exercise of business activities for a period of up to 90 days, without the need of any visa application. This period, therefore, can be used as a trial mechanism before engaging the full expatriation process.

 

Once the decision to expatriate is made, the journey starts with the careful drafting of an expatriate agreement signed in the home country, regulating the situation of the employee in said jurisdiction. Because the Brazilian legislation demands all employees working in the territory submit to Brazilian labor laws, most employers suspend (when foreign legislation allows) or terminate the foreign work contract and negotiate a new agreement under the Brazilian legislation.

 

Some companies choose to keep some sort of labor agreement still active in the home country, however it is important to emphasize that Brazilian labor law benefits will still apply to this agreement and that all compensation paid abroad will be taxed in Brazil and will incorporate all labor benefits provided by local laws. 

 

Following the financial negotiation with the candidate to expatriation, the employer must start the work visa process for such employee in Brazil. The main aspects considered by the Brazilian government when deciding to issue or not the work visa are the following:

 

a) The Brazilian company/office sponsoring the visa shall not have more than 1/3 of its work force formed by foreigners;
b) The qualifications of the applicant to the work visa; and
c) The need to protect local labor market, in which case it is important to specify the importance of the expatriate to the “soft landing” of the company in Brazil.

 

Therefore, although often overlooked by companies, the legal aspects of expatriation should be considered carefully – after all, problems may arise, and they often are more difficult to solve in a foreign territory.

 

 

[1] The determination of the visa fee process for short-term stays with the purpose of vacation or the exercise of business activities will vary from country to country, according to the reciprocity principle. Specific information regarding the maximum period of stay and visa free cases are specified in the Brazilian Consulates website located in each specific country.

Advogado Responsável

Gabriela Figueiras
Gabriela Figueiras81 2101.5757