Finance Monthly - August 2022

Inve s tmen t 62 Finance Monthly. s a rule, foreign investments in Brazil must be registered with the Central Bank of Brazil (“BACEN”). Registration of foreign investments may be divided into two main categories: (i) foreign direct investments which are regulated by Law 4,131 of 3 September 1962, as amended, (“Direct Investment” and “Debt Transactions”); and (ii) investments made in the Brazilian financial and capital markets, which requires the use of a local custodian to represent the foreign investor, regulated by CMN Resolution 4,373 (“Indirect or Portfolio Investment”). The registration of foreign capital is done at the Electronic Declaratory Registration System (“RDE”), at the Central Bank of Brazil (“BACEN”) information system (“SISBACEN”). The foreign capitals are registered in specific modules, according to their classification, which are: • Foreign Direct Investment (“IED”); • Foreign Debt Transactions, such as loans, long-term imports financing and royalties’ contracts (“ROF”); and • Indirect or Portfolio Investments. Direct Investment According to the BACEN, a direct investment is defined as such by its intention to remain long-term in the country and by its acquisition over-the-counter markets, direct in non-listed companies . Brazilian companies can receive foreign direct investment from both Individuals and Legal Entities that are not resident in Brazil. Registration of a foreign direct investment must be submitted electronically to the Central Bank by the company receiving the investment (the investee), using the SISBACEN for direct foreign investments (“RDE-IED”). Debt Transactions Foreign debt transactions may be made through the exchange of foreign currency (i.e., loans, certificates of deposit, private debentures, etc.) directly between a foreign and a domestic party. A foreign debt transaction must be registered with the BACEN before the actual inflow of funds and submitted electronically by the investee using the SISBACEN for foreign debt transactions (“RDE-ROF”). This electronic registration does not require preliminary approval. Indirect Investments or Portfolio Investments Investments by foreign investors in Brazilian financial and capital markets are regulated by the National Monetary Council (the “CMN”), the Brazilian Securities and Exchange Commission (the “CVM”) and BACEN. The main regulation governing such investments is CMN Resolution 4,373 of 29 September 2014. With certain exceptions, foreign investors may invest in the Brazilian

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