Coredo

B3 and Brazil’s investment potential

Why Brazil Is in the Spotlight for Managers

Currency risk in Brazil

Entry strategy from holding to fund

Legal form of the special-purpose vehicle: Ltd. or S.A.

For investment projects, Sociedade Limitada (Ltda.) and Sociedade Anônima (S.A.) are generally suitable. Ltda. is easier to manage and fits SPVs and joint ventures when speed and control matter. S.A. is appropriate when attracting institutional investors, issuing securities and for more complex corporate governance. In COREDO projects we document corporate rights through an SHA (shareholders’ agreement), set up drag/tag-along, distribution rules, covenants, and also use escrow agreements and clear SPA mechanics on entry/exit.

Onshore vs offshore: CFC and DTA

COREDO’s practice confirms that early checking against international CFC rules (for example, on a fund’s passive income) often changes the choice of holding country. We analyze taxation regimes for dividends, interest and capital gains, as well as conditions for repatriation of profits from Brazil, so that the final IRR reflects real cash flows after taxes and IOF.

Company registration in Brazil

Access to the capital market: CVM, ANBIMA, B3

How a foreign manager can gain access to the Brazilian capital market

Access to the capital market runs through the Comissão de Valores Mobiliários (CVM). Registration of the manager with the CVM and Licensing and registration of managers of foreign funds in Brazil require proving organizational structure, risk management procedures, compliance and independent control. We prepare policies, descriptions of the investment process, a conflicts of interest matrix and DR plans, relying on ANBIMA standards.

Setting up a fund in Brazil

When setting up a fund in Brazil (fundos de investimento) the key choice is the legal wrapper: FIP for private equity, FIDC for securitization of receivables, FII for real estate, FIA for public equity. The fund type dictates requirements for diversification, NAV valuation, permissible assets and disclosure levels. We select an administrator, custodian, auditor and transfer agent, and also design the NAV calculation and CVM disclosure processes.

COREDO helps formulate a liquidity management policy and redemption policy if the structure is open. We link the calculation of management fee, performance fee and carried interest to the fund’s objectives and market practice. This helps to pass institutional LP questionnaires and comply with ANBIMA standards on transparency.

Custody and clearing through B3

How to organize custody and clearing through B3 is a practical question in the first month. We carry out Due Diligence of custodial banks, assessing their experience with foreign managers, reporting functionality, SLAs for corporate events and real-time monitoring capabilities. B3’s clearing infrastructure and settlement systems set operational windows; this affects cut-offs for orders, the handling of corporate actions and voting procedures.

Compliance and AML in Brazil

KYC, CDD/EDD and beneficial ownership

AML in Brazil for asset managers is regulated by COAF and requires strict KYC, CDD and EDD procedures. We design client risk scoring, beneficial ownership checks and sanctions control and screening. Requirements for disclosure of beneficial owners (beneficial ownership) have tightened, and banks will not open accounts without a clear ownership structure and source of funds.

FATCA/CRS and cross-border compliance

FATCA and CRS compliance when dealing with Brazilian assets is not only the concern of administrators but also of the manager. We organize the collection of self-certifications, status updates and the proper transmission of data to administering institutions. For cross-border transactions it is important to take into account IOF and local currency rules (câmbio) so that the payment structure is lawful and predictable in timing.

Compliance in asset management in Brazil includes practices for managing conflicts of interest, personal employee trades, gifts and entertainment, as well as wall-crossing procedures in M&A deals. COREDO’s practice confirms that formalizing these rules simplifies communication with the CVM and reduces the audit burden.

Taxation of investments in Brazil

Repatriation: Corporate Income Tax, Social Contribution on Net Profit, Tax on Financial Transactions

Taxation of investments in Brazil is built around IRPJ and CSLL for companies, as well as special regimes for funds. We model conditions and taxes for repatriation of dividends and sale of assets, taking into account DTAs and withholding taxes. IOF, as a tax on financial transactions, affects short-term loans, currency conversion and investment instruments: this is important to consider in cash flows.

CFC and transfer pricing

We assess the impact of double tax treaties on fund income at both the recipient and source levels, synchronizing Brazilian withholdings and foreign credits/exemptions. The COREDO team uses tax matrices that are updated as rules change so clients make decisions based on current data.

Accounts and reporting in the middle/back office

Bank accounts and custodian

Bank accounts and custodian services in Brazil are a separate workflow. We prepare a package of documents with an apostille, prepare questionnaires on sources of funds, beneficial ownership and AML/CFT policies. Which banking and custodial services to choose for foreign managers depends on the strategy: public equities, private equity, debt structures or real estate.

How to organize due diligence of local assets and counterparties is another critical process. COREDO builds checklists for legal, tax and operational due diligence, including verification of licenses, litigation risks and ESG factors. This becomes the basis for the investment memorandum and subsequent monitoring.

Registers and reporting

Registers and reporting include CNPJ, RDE-IED, tax returns and mandatory notifications to Receita Federal and CVM. We implement operational calendars with deadlines and responsible persons so that the manager’s team meets timelines. Filing reports through electronic portals reduces the paper trail but requires care in completion and archiving.

Currency and Risk Management

Market/Political/Regulatory Risks

risk management of a political and regulatory nature in Brazil is part of the strategic mandate. We analyze changes in CVM, ANBIMA and Banco Central regulations, and prepare roadmaps in case of tightening/loosening. Judicial risks and labor law are taken into account in models of operating costs and reserves.

Currency Risk and Inflation

Currency risk management and hedging for investments in the Brazilian real are built in a cascade: a natural hedge at the revenue and cost level, derivatives (forwards, swaps, options) and open position limits. We check the cost of hedging and the impact on returns after fees and margin. Indexation and inflation indicators (IPCA, IGP-M) are included in stress models to assess the sensitivity of cash flows.

COREDO Case Studies

FIP for an industrial cluster

К нам обратился иностранный управляющий с идеей платформы roll-up в индустриальном сегменте. Решение, разработанное в COREDO, включало холдинг в Люксембурге, SPV в Бразилии (Ltda.), регистрацию управляющего в CVM и создание FIP. Мы заключили SHA с локальными соинвесторами, согласовали custodian и clearing через B3, внедрили NAV-процедуры и комплаенс-матрицу ANBIMA.

Результат: фонд прошел регистрацию, администрирование наладилось за 60 дней, а первые капиталовызовы закрылись в срок. Репатриация прибыли из Бразилии спланирована через DTA, а валютные риски хеджируются свопами с квартальной переоценкой.

Receivables Investment Fund

Команда COREDO структурировала FIDC под финансирование торговых требований ритейла. Мы отобрали сервиcера, настроили KYC/EDD для поставщиков требований, внедрили transaction monitoring в реальном времени и процедуры COAF. Transfer agency и реестр инвесторов синхронизированы с администратором, а disclosure в CVM автоматизирован.

На налоговой стороне мы просчитали transfer pricing для комиссий сервиса и установили arm’s length. В итоге доходность инвесторов стабилизировалась, а риск-факторы контролируются через ковенанты и стресс-тесты портфеля.

FII and SPV infrastructure strategy

Для инвестиций в логистические объекты мы предложили FII в связке с локальными SPV (Ltda.) и долгосрочными договорами аренды, индексированными IPCA. Практика COREDO подтвердила, что такой подход улучшает банковское финансирование и прозрачность для институциональных LP. Мы предусмотрели escrow на этапе строительства, страхование политических рисков и четкий порядок capital calls.

Репатриация дивидендов идет по DTA-правилам, а валютное хеджирование привязано к денежным потокам из аренды. Учёт по МСФО согласован с бразильским стандартом для консолидации на уровне глобального управляющего.

Roadmap for entering Brazil

• Diagnosis of investors’ objective and mandate: risk profile, liquidity, timeframe.
• Choice of structure: onshore vs offshore, holding, SPV, DTA and CFC assessment.
• Legal form: Ltda. or S.A., preparation of SHA, SPA, escrow.
• Registration in Brazil: CNPJ, CPF for directors, RDE-IED at Banco Central.
• Bank accounts and custodians: supplier due diligence, SLA, integration with B3.
• Regulatory access: manager registration with the CVM or sub-advisory model; ANBIMA standards.
• Fund creation: choice of type (FIP, FIDC, FII, FIA), administrator, auditor, transfer agent.
• Compliance/AML: KYC, CDD/EDD, COAF, sanctions screening, real-time monitoring.
• Tax model: IRPJ, CSLL, IOF, transfer pricing, repatriation plan, DTA.
• Operations: NAV procedures, reporting to the CVM/Receita Federal, portal filings.
• Risks: BRL hedging policy, VaR, stress tests, governance.
• Launch and scaling: KPI, operational

Manager’s KPIs and operating model

Scaling in Latin America

How COREDO helps

Conclusions

Brazil, a market where scale meets regulatory depth. Here it is important to combine strategy and execution discipline: from choosing between Ltda. and S.A. and setting up a JV to registering the manager with the CVM, creating a fund and organizing custody and clearing through B3. Taxation of investments in Brazil, compliance when managing assets in Brazil and AML compliance in Brazil for asset managers determine the speed of launch, the possibility of repatriation and the ultimate returns.

Since 2016 I have been managing COREDO and personally overseeing transactions in which a holding company in the Netherlands becomes the central element of M&A, financing and cross-border asset ownership. During this time the COREDO team has implemented dozens of projects in the EU, the United Kingdom, Singapore and Dubai, as well as in the markets of Asia and the CIS, and I can clearly see why a Dutch holding remains the number one tool for multinational groups. Below are the concentrated experience and algorithms that help clients confidently move from concept to deal closing and subsequent integration.

Why establish a holding company in the Netherlands for M&A?

When I’m asked why a holding in the Netherlands for M&A remains a benchmark, I give three reasons: a predictable legal environment, a well-developed treaty framework for avoiding double taxation, and a clear tax logic. The advantages of a Netherlands holding for mergers and acquisitions are further strengthened by flexible corporate forms, fast registration, and acceptable operating costs.

Legal forms of the holding

The BV holding structure in the Netherlands remains the standard for M&A thanks to limited liability, minimal requirements for share capital, and clear corporate governance rules. Registering a BV as a holding is fast, and management is easily scalable to the group’s needs, including financing, IP ownership, and centralized management of holdings.

The CV form (limited partnership) and the coöperatie are used less often but remain appropriate for investor pools and flexible profit distribution. The coöperatie was historically used to minimize withholding tax on dividends; now it is used primarily for contractual flexibility and member participation, especially in venture and infrastructure projects.

Tax regime: questions and answers

Tax consequences: the basis of the architecture of any holding structure. COREDO’s practice confirms: it is better to set all parameters at the start than to rebuild the structure later to meet the requirements of tax authorities and bank compliance.

Participation exemption in the Netherlands

Corporate income tax for holdings in the Netherlands

The basic CIT rate in the Netherlands is 25.8% (a reduced rate of around 19% applies to profits up to a set income threshold). For income covered by the participation exemption, no tax is payable. Capital gains tax on the sale of a share via the Netherlands is also not levied if the participation exemption applies, which is critical when planning an exit or reorganisation.

Withholding tax and transit of dividends

The standard withholding tax on dividend payments from the Netherlands is 15%, but double tax treaties and the Parent‑Subsidiary Directive often reduce the rate to 0–5% between related parties within the EU. Since 2024 there is also a “conditional” withholding tax on dividends to low‑tax/sanctioned jurisdictions at a rate comparable to the upper bound of CIT. The MLI (Multilateral Instrument) has strengthened anti‑abuse provisions in DTTs and introduced the PPT (principal purpose test), so routing dividends through the Netherlands is only possible with a genuine economic purpose.

BEPS, ATAD, CFC and Pillar Two

Pillar Two (the global minimum tax) introduces a 15% effective rate for multinational groups with revenue over EUR 750 million. We assess the impact of Pillar Two on the holding structure in advance: we build an ETR model, check IIR/UTPR exposure and, if necessary, adjust the ownership chain and local substance.

Economic substance: requirements and practices

Economic presence (substance) for a Dutch holding has ceased to be optional. Substance requirements for holdings in the Netherlands include local directors with real control, an office/team, a business plan, a resident bank account, local accounting and meeting minutes protocols. I use a “substance roadmap” of 10 points, where we set KPIs for functions, risks and assets, as well as analogue and digital evidence of substance for the tax authorities: employment contracts, lease agreements, billings, minutes and timesheets.

AML and KYC for a holding in the Netherlands

UBO registration for holdings in the Netherlands is mandatory. The Netherlands UBO register: disclosure of beneficiaries is made in the KvK, while public access is limited and banks and competent authorities have direct access. CRS and FATCA obligations of a holding in the Netherlands arise if the company qualifies as a financial institution; otherwise, we check group statuses to avoid unexpected reporting and fines. Suspicious activity reporting: FIU‑Nederland: I train client teams on the principles of identifying red flags and documenting refusals/escalations.

Transfer pricing through APA/ATR

Transfer pricing policy for holding companies, the foundation of a fixed margin and a protective “perimeter” during Belastingdienst audits. We build the policy based on functions‑risks‑assets, select comparable transactions and prepare the Master File, Local File and, if necessary, the CbCR.

BV Registration: Chamber of Commerce and Tax and Customs Administration

The procedure for registering a BV and the timeframes usually take 3–7 business days after receiving the KYC package and draft documentation from the notary. The list of documents for BV registration includes passports of directors/UBOs, proof of addresses, the articles of association, the memorandum of association, corporate resolutions and a description of activities. Entry in the KvK trade register for the holding takes place on the day of signing at the notary, and a KvK number and VAT number are assigned (by a separate procedure).

The cost of maintaining a holding in the Netherlands and OPEX ranges from €12,000 to €50,000 per year with a local director, office, accounting, audit and corporate secretarial support. Corporate secretarial support and reporting cover minutes of meetings, annual reporting, UBO updates and interaction with the KvK and Belastingdienst.

Governance and protection of interests

Corporate governance requirements in a Dutch BV impose duties on the BV’s directors to act in the interests of the company and the group, and set out responsibility for proper accounting and compliance with tax and sanctions rules. The role of a stichting (foundation) in protecting assets and P&I is especially notable in public and pre‑IPO structures: a stichting may hold privileged voting rights or manage a “golden share”.

M&A transactions through a Dutch holding company

A holding company and the transactional structure of M&A deals in the Netherlands provide flexibility in choosing a share deal or an asset deal. The difference between a share deal and an asset deal in the Dutch context appears in the tax base, transfer of liabilities, VAT/transfer taxes and speed of integration. I usually recommend a share deal for portfolio investors and an asset deal for carve-outs with complex liabilities.

Integration after M&A using a holding in the Netherlands requires well-honed processes: consolidation, updating the transfer pricing policy, realigning intercompany agreements, unifying dividend policy and restructuring treasury. Integration of tax processes after M&A includes standardizing VAT accounting, DAC6 procedures, KPIs for the CCO (compliance officer) and setting up an audit trail.

Financing/IP/venture/estate planning

Raising finance through a Dutch holding is convenient thanks to loan agreements governed by English law, clear mechanisms for pledging shares/assets and a predictable TP approach. We set up intercompany loans on arm’s‑length terms, monitor interest covenants and check the 30% EBITDA limit for interest.

Structuring IP and royalties through a holding requires careful assessment of anti‑hybrid/BEPS and the presence of a real IP management function: strategy, Licensing, marketing, R&D contracts.

International licensing of IP and the tax consequences affect VAT, WHT on royalties (including “deemed” WHT on payments to low‑tax jurisdictions), as well as the TP margin for IP management.

Contractual network: migration and exit

Tax treaties for the avoidance of double taxation – we check key provisions with respect to the beneficial owner, PPT, WHT limits and special clauses for holdings. Withholding tax rates and minimisation methods rely on DTT, the Parent‑Subsidiary Directive, confirmation of residence and substance.

ESG Governance and Reporting

ROI metrics for the holding structure (NPV, IRR, payback) are calculated together with clients, adding the «cost of compliance» and the benefit from reduced WHT/capital gains tax. Assessing tax efficiency and tax savings vs the cost of compliance helps make a mature decision: instead of «minimizing at any cost», sustainability and predictability over a 5–7 year horizon. Reputational and ESG risks of an international holding become a factor in access to capital, so I set KPIs for substance, reporting and sanctions procedures directly in the project’s roadmap.

COREDO case

• Transit of dividends through the Netherlands and an Asian exit. The COREDO team structured a BV holding for a group exiting investments in Southeast Asia. The participation exemption conditions covered the share sale, the DTT reduced the withholding tax on dividends to 5%, and the presence of substance in Amsterdam passed the PPT review. Result: a predictable tax burden and a successful reinvestment through a European platform.
• Use of a stichting in M&A and protection of control. In the IT assets consolidation deal we implemented a STAK to separate economic rights and voting rights. This allowed investors to receive priority on dividends, and founders to retain strategic control until KPIs are met. The solution developed at COREDO simplified the SPA and reduced the scope of warranties due to the clear structure of rights.
• APA for the treasury function and debt financing. Our experience at COREDO has shown that pre‑agreeing margins with Belastingdienst through an APA saves years of potential disputes. We prepared a TP policy, comparable data and a substance dossier; the inspector approved the target margin, and the bank increased the credit line after receiving the APA.

Frequently asked questions from clients

• Tax treaties and the Netherlands: changes from the MLI and local anti‑abuse rules have strengthened requirements for the beneficial owner and the business purpose. I always build an evidentiary base regarding substance and the value‑creation chain into projects.
• How to obtain a Dutch tax ruling: procedure and documents? I prepare a business questionnaire, a functional map, a financial model, drafts of intercompany agreements and the “inspector’s questionnaire”. In the pilot we agree the scope of the request, then submit formally.
• Timeline and cost of registering a holding in the Netherlands. Registering a BV takes up to a week, for the bank – 2–6 weeks, for tax numbers: up to 2 weeks. OPEX, from €12,000 to €50,000 per year depending on the mix of functions and the audit.
• Tax incentives and grants in the Netherlands for group companies. For operating centres R&D incentives, innovation and sustainability subsidies may be available; the holding itself does not receive incentives, but can redistribute funding within the group.

COREDO Roadmap

1. Diagnostics: M&A objectives, dividend/royalty routes, DTT, ATAD/BEPS/Pillar Two risks.
2. Structuring: legal form (BV/CV/coöperatie/stichting), dividend policy, TP‑policy, AML‑risk map.
3. Registration: notary, KvK, UBO, VAT/CIT, bank, local director and office.
4. Predictability: APA/ATR where necessary, preparation for DAC6 and CFC analysis.
5. Documentation: corporate governance, minutes, substance‑dossier, audit trail.
6. Transaction: SPA package, escrow, W&I, earn‑out, integration and update of TP/VAT.
7. Monitoring: interaction with Belastingdienst, CCO KPIs, regular health‑check of the structure.

Legal support and resilience

Legal support for an international holding in the Netherlands includes regular updates to the articles of association, option plans, intercompany agreements, bank covenants and SPA restrictions. The COREDO team assists with filing changes in the KvK trade register for holdings, prepares notifications to the Belastingdienst and monitors compliance with ATAD, DAC6 and local AML rules.

We record the dividend policy and intercompany payments in the holding by separate resolutions, tie them to the TP model and the group’s cash-flow needs. Best practices for maintaining tax documentation and the audit trail are timely minutes, descriptions of business purposes and an archive of relevant correspondence/memoranda.

Conclusions

Since 2016 I have been building COREDO as a platform where legal precision meets technological practice. During that time the COREDO team has implemented dozens of projects in the EU, the United Kingdom, Singapore, Dubai, the Czech Republic, Slovakia, Cyprus and Estonia: from company formation and obtaining financial licenses to AML consulting and implementing smart contracts into a client’s operating model. In this article I present a systematic view: when and how smart contracts operate as a legally meaningful infrastructure, how to reduce risks and achieve measurable ROI.

Our experience at COREDO has shown that “smart contracts for business” is not about fashion, but about managed automation of obligations in accordance with contract law and regulatory frameworks. I will examine legal statuses in key jurisdictions, issues of recognition in courts, the connection with AML/KYC and data protection, and provide guidance on designing “self-executing contracts” and the economics of implementation (TCO, CAPEX, OPEX and ROI metrics).

Smart contracts: legal reality

Smart contract vs traditional contract

International framework: EU, Asia, CIS

The international framework covers the EU, Asia and the CIS countries, where approaches to regulating smart contracts differ significantly in terms of recognition, evidentiary value and liability. Below we will examine the key legal features and practical implications for each region, starting with the legal status of smart contracts in the EU.

Legal status of smart contracts in the EU

Legal status of smart contracts in Asia

International regulation: UNCITRAL

Legal force and recognition in court

Understanding the legal force of electronic documents is important for minimizing risks and ensuring their applicability in legal practice. Below we will examine mechanisms of court recognition, enforcement of decisions, features of electronic evidence, and rules for secure storage that determine when digital data become fully admissible evidence.

Recognition of electronic evidence

On-chain and off-chain: mechanisms and arbitration

AML/KYC: data protection

AML/KYC processes, a key tool in identifying and managing risks, require strict adherence to international standards and compliance procedures. Reliable data protection ensures the traceability of operations and reduces the likelihood of leaks, which will form the basis for the discussion of risks, recommendations of FATF and traceability issues.

AML/KYC risks and FATF recommendations

GDPR data protection

Asset licensing and tokenization

Licensing in asset tokenization is a key factor determining the legality and commercial sustainability of projects in the digital rights market. In the following section we will examine in detail which licenses are required and how the MiCA framework shapes requirements for the issuance and circulation of tokens.

MiCA licenses

Tokenization standards

DAO Corporate Governance

Legally compliant smart contracts

Designing requires attention to detail: smart contracts must be legally compliant and drafted so that their execution conforms to legal norms. In the following sections we will review practical steps for drafting and bringing them in line with contract law requirements to minimize the risk of disputes and ensure the enforceability of the terms.

Formalize the contract under contract law

How to legally formalize a smart contract — rely on a master agreement where:

• the parties are defined (legal entities and their on-chain addresses);
• the smart contract is described as a legal agreement, its functions and limitations;
• the role of standard clauses in smart contracts is established: governing law, forum, arbitration, notices, force majeure;
• penalties and sanctions for breach of smart contracts and off-ramp procedures are provided;
• escrow via smart contracts and conditional transfers, time-lock and conditions for deferred performance are described.

Electronic signature: eIDAS and QES

The role and liability of oracles

Reliability and security of technologies

The reliability of the technological platform and ensuring its security are not abstract tasks but mandatory conditions for the stable operation of systems and the preservation of users’ trust. This is achieved through formal verification, independent audits, and a clear allocation of responsibility among the participants in the process.

Formal verification and audit

Upgradeability, versions and SLA

Integration and operational model

Integration of key systems: ERP/CRM and CLM is a prerequisite for building a transparent and manageable operational model where data and processes are aligned across departments. In the following points we will examine which standards and architectural solutions provide such synchronization and how this is reflected in daily operations.

ERP/CRM and CLM standards

How to integrate smart contracts with ERP and CLM — via data buses and events (webhooks) with guaranteed delivery and status mapping.

Operational limits and scalability

Economics of implementation

The economic aspects of implementation determine how viable and cost-effective the project will be in the long term. In this section we will examine key metrics, ROI and TCO, and discuss risk insurance mechanisms that help protect investments and reduce uncertainty.

ROI and TCO in risk insurance

COREDO case studies and best practices

Preparing a company for smart contracts

Regulatory and judicial practice

COREDO turns technology into results