Internationalization

Differences between IPOs in Brazil and the United States

Do you know the differences between IPOs in Brazil and the United States? We’ll cover the subject in this article. The IPO, or Initial Public Offering, is the process by which a company issues shares on the market for the first time, becoming a publicly traded company. This means that its shares are publicly traded on the stock exchange. The main reason companies go public is to raise funds to develop and invest in their business. In Brazil, the IPO process is regulated by the CVM, the Securities and Exchange Commission. Companies need to follow a series of requirements and adjust their financial and administrative structure to increase their levels of governance. In the Brazilian context, bureaucracy is a major challenge for companies. The IPO process in the country is complex and can take around a year to complete. In addition, the cost of the IPO can be substantial, not to mention the ongoing expenses after listing on the stock exchange. However, despite these challenges, having shares traded on the market can offer attractive returns, especially for companies looking to make new investments. Other differences between IPOs in Brazil and the United States In the United States, the process is regulated by the SEC, the Securities and Exchange Commission. Companies can choose between several stock exchanges, the best known being the NYSE or NASDAQ. One of the other differences between IPOs in Brazil and the United States is that on American soil, the IPO market is known for its agility and the presence of institutional and retail investors. Brazilian companies that choose to go public in the United States are not only looking to increase their global presence, but also to strengthen their ability to raise capital. According to information from 2023, the United States holds almost 59% of the total market capitalization globally. This means that more than half of the world’s market value is associated with the North American market. Despite the differences, both in Brazil and the US, the IPO is an exciting opportunity for companies and investors. Do you have any questions on the subject or want to internationalize to the US? Get in touch with us via the available chat or email info@drummondadvisors.com. Written by Marcos Ferreira, Content Analyst at Drummond Advisors

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Brazilians now have automatic residence authorization in Portugal

On March 1, 2023, Ordinance 97/2023, of February 28, entered into force. This aimed to comply with the agreement of the 2021 meeting of the Community of Portuguese-speaking Countries (CPLP), endorsed by the Portuguese Assembly. From now on, nationals of CPLP countries, which is composed of Angola, Brazil, Cape Verde, Guinea-Bissau, Equatorial Guinea, Mozambique, Sao Tome and Principe and East Timor, enjoy a privilege regarding the residence permit in Portugal, leading to a faster and cheaper process. According to the new legislation, the request can be made online on the website of the Service of Foreigners and Borders (SEF), which will generate a digital certificate of the residence permit, being only the cost of issuance charged and there being exemption from other fees. With the granting of the automatic residence permit, it will no longer be necessary the process of expression of interest with the SEF, which currently has a period of up to 2 (two) years to schedule an interview with interested parties. Considering that Ordinance 97/2023 is already in force, all Brazilians who have entered legally in Portugal (including those waiting for the SEF interview), will benefit from the possibility of issuing the residence permit online, without the need to wait for above-mentioned interview with SEF. In this sense, CPLP nationals who are already in Portugal or intend to go there, will be able to carry out a wide range of activities with a lawful stay, since they will have the possibility to apply for and obtain the residence permit quickly after legally entering in the country. Among several activities, with the residence permit CPLP nationals have permission to study, work, rent real estate, etc. The residence permit will be valid for one (1) year, and in the coming months rules regarding an eventual renewal are expected to be published. Need assistance to obtain your residence permit in Portugal? Contact our Drummond Advisors Global Mobility team! Reference: Ordinance No. 97/2023, of February 28 Written by Eduardo Giugliano and Ana Gabriela Francelli

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Learn about the details of the new global tax agreement under debate

In recent years, the world has discussed important changes in international taxation rules that affect multinational companies. In the last quarter of 2023, after talks at the Organization for Economic Cooperation and Development (OECD), more than 130 member jurisdictions consented to a new taxation project. Large corporations pay more taxes in countries where they have customers and less in countries where they have headquarters, employees and operations. In addition, the agreement establishes a minimum global tax of 15%, which increases taxes for companies based in low taxation jurisdictions. Governments are developing implementation plans and signing the agreement into effect. The OECD proposal follows a plan that has been debated on since 2019. There are two “pillars” of reform: the first pillar changes where large companies pay taxes (impacting approximately US$125 billion in profits); The second pillar introduces the global minimum tax (increasing tax revenue by approximately US$ 150 billion worldwide). Delays in implementation and disagreements on political details have pushed back the timeline for a full agreement on the first pillar toward the mid-2023 and implementation of the second pillar by 2024 at the earliest. The first pillar covered the “value A” which applies to companies with more than 20 billion euros of revenue and a profit margin of greater than 10%. A portion of the profits of these companies are taxed in the jurisdictions where they sell. 25% of profits above the 10% margin may be taxable. After a seven-year review period, the € 20 billion limit could be reduced to € 10 billion. The “value A” is a limited redistribution of tax revenues from the countries in which a large multinational company operates for the countries where its customers are located. Most of these companies are American companies. The first pillar also contains the “value B”, which provides companies with a more agile way of calculating taxes on overseas operations such as marketing and distribution. The second pillar is a global minimum tax. It consists of three main rules and a fourth rule for tax treaties. These rules apply to companies with revenues greater than € 750 million. Model rules will be published in December 2021. Written by Marcos Ferreira, Content Assistant to Drummond Advisors

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Taxation in Portugal

How the Portuguese tax system works and what you need to know before moving to the country According to data on immigration in the year 2022 released by the Portuguese Foreigners and Borders Service (SEF), the number of immigrants living in the country has increased for the seventh consecutive year and has already surpassed the 750,000 mark. Still according to the survey, the communities that grew the most in this period were the Brazilian and Indian ones. There are already 233,138 Brazilians and they lead the list of foreigners living in the country. One of the most important aspects, and one that deserves the attention of everyone moving to Portugal, is tax obligations. Knowing about the Portuguese taxes that are currently in force is essential to maintain tax compliance and avoid possible problems with the tax authorities. Only the Central Government and municipalities are authorized to create taxes in the country. This system was adapted according to the European Union standard and reduces the number of taxes that may be levied on the assets of Portuguese tax residents. Income Taxes There are three taxes that affect income in Portugal: the Personal Income Tax (IRS), the Corporate Income Tax (IRC) and the Derrama rate. The IRS is very similar to the Income Tax on Individuals in Brazil and is charged according to the taxpayer’s income. In Portugal, IRS rates are divided into levels. Check the list of values that are being practiced in 2023: Level Standard Rate (A) Average Rate (B) Up to € 7,479 14.5% 14.5% From € 7,479 to € 11,284 21% 16.69% From € 11,284 to € 15,992 26.5% 19.58% From € 15,992 to € 20,700 28.5% 21.61% From € 20,700 to € 26,355 35% 24.48% From € 26,355 to € 38,632 37% 28.46% From € 38,632 to € 50,483 43.5% 31.99% From € 50,483 to € 78,834 45% 36.67% More than € 78,834 48% – The amount of taxable income, when greater than € 7,479, is divided into two parts, as follows: one, equal to the limit of the largest of the levels that it fits, to which the rate in column B corresponding to that level applies; another, equal to the surplus, to which the rate in column A for the next higher level applies. (Wording of Law No. 24-D/2022, of December 30) Source:  No. 1 of article 68 of the 2023 State Budget. The IRC IRC is the one that focuses on the earnings of companies operating in Portugal. The incidence happens from the profits generated. Institutions that are headquartered in another country, but carry out activities in Portugal, are also subject to the tax – in this case, the incidence of IRC is only on the percentage of income obtained by the company within Portuguese territory. Taxation rates vary according to the location where the company operates, and the value generated from the income. The autonomous territories of Madeira Island and the Azores have different laws and fees from those practiced in continental Portugal (term used to designate the Portuguese territory located in the region of the Iberian Peninsula). In the Continental region, the normal corporate tax rate is 21%. Small and Medium-sized Enterprises (SMEs) have a reduced rate of 17% on the first 50,000 euros of profit obtained (the rest is taxed at the normal rate). In Madeira Island and the Azores, the rates follow the following percentages: 14.7% on Madeira Island; 16.1% in the Azores. It is important to mention that, according to Recommendation 2003/361/EC, SMEs are classified as follows: Medium-sized company – has between 51 and 250 employees; the maximum annual turnover is € 50 million, or the annual balance sheet total must not exceed € 43 million; Small-sized company – staff of 11 to 50 people and the annual turnover or annual balance sheet does not exceed € 10 million; Microenterprise – has less than 10 employees and the annual turnover or annual balance sheet does not exceed € 2 million. Municipal Derrama Charged by municipalities, this tax impacts companies and is defined according to the size of the business in question. Click here  to consult the municipal Derrama rates that are in effect in 2023. State Derrama Companies operating in Portugal are also taxed by the State Derrama – an additional tax on taxable income, which varies according to the amount of the gain in question: Profit between € 1,500,000 and € 7,500,000 – 3% additional fee; Profit between € 7,500,000 to € 35,000,000, 5% additional fee; Profit greater than € 35,000,000 – 9% additional fee. Net Worth Taxes In this category of taxes, there are also three types of taxation that may occur: the IMI (Municipal Tax on Real Estate), the IMT (Municipal Tax on the Onerous Transfer of Real Estate) and the IS (Stamp Duty). The IMI would be the equivalent of the IPTU, in Brazil, or the Property Tax, in the United States. Taxation is municipal and applied to buildings and constructions. The collection of IMT varies according to the value of the property deed, and in some cases, the buyer is exempt from payment. Residences purchased on the Continent with values below € 93,331 are exempt. For properties purchased in the Autonomous Region of Madeira or the Azores, exemption applies up to the amount of € 116,664. The Stamp Duty, considered the oldest still in force in Portuguese territory, is a fixed percentage charged on contracts or commercial transactions. This percentage may vary according to the origin of the operation. Check out some of the most common fees: Acquisition of property with a high value or by donation – 0.8% rate;  Rent or sublease, levied on one month’s income –10% rate;  Transfer of ownership of establishments – 5% rate  Collective investment entities that invest exclusively in the money and deposits market – 0.0025% rate  Other collective investment entities – 0.0125% rate  Car Taxation Check below the most common taxes levied on cars in Portugal, both at the time of purchase and as a result of vehicle circulation within

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Immigration Updates

1. USCIS Extends Flexibility for Responding to Agency Requests In response to the COVID-19 pandemic, USCIS is extending the flexibility it announced on March 30, 2020, to help applicants, petitioners, and requestors who are responding to the following: Requests for Evidence; Continuations to Request Evidence (N-14); Notices of Intent to Deny; Notices of Intent to Revoke; Notices of Intent to Rescind; Notices of Intent to Terminate regional centers; and Motions to Reopen an N-400 Pursuant to 8 CFR 335.5, Receipt of Derogatory Information After Grant. If the issuance date specified on the request, notification, or judgment is between March 1, 2020, and March 26, 2022, inclusive, this flexibility applies to the papers listed above. USCIS will evaluate a response to the following requests and notices received within 60 calendar days of the response due date specified in the request or notice. 2. DOS Proposed Rule to Raise Several Consular Service Fees https://www.aila.org/infonet/dos-86-fr-74018-12-29-21 The Departament of State (DOS) has Proposed to increase Visa Fees for Nonimmigrant Visa (NIV) Application and Border Crossing Card Processing Fees, please see summary of the proposal below: NIV fee from $160 to $245 per application (Consular Fee DS-160 application). Includes the following applications: business and tourist travel (B1/B2); students and exchange visitors (F, M, and J); crew and transit visas (C and D); representatives of foreign media (I), and other country-specific visa classes, as well as BCCs for applicants age 15 or older who are citizens of and resident in Mexico. NIVs related to employment in the United States from $190 to $310 (Consular Fee DS-160 application). Includes the following applications: temporary workers and trainees (H); intracompany transferees (L); aliens of extraordinary ability (O); athletes, artists, and entertainers (P); international cultural exchange participants (Q); and religious workers (R). 3. President Revokes Proclamation Suspending Entry of Certain People Who Pose a Risk of Transmitting Omicron Variant https://www.aila.org/infonet/proclamation-suspension-omicron-covid As we informed on December 3, 2021, the White House issued a proclamation on November 26, 21 restricting and limiting entrance for certain immigrants and nonimmigrants who were physically present in countries where the COVID-19 Omicron variant had been identified. (86 FR 68385, 12/1/21) • Republic of Botswana • Kingdom of Eswatini • Kingdom of Lesotho • Republic of Malawi • Republic of Mozambique • Republic of Namibia • Republic of South Africa • Republic of Zimbabwe President Biden rescinded Presidential Proclamation 10315, which had barred these individuals from entering nations where the Omicron version of COVID-19 had been found, on December 28, 2021. Following that, the Department of State published guidelines on the revocation of travel restrictions for Botswana, Eswatini, Lesotho, Malawi, Mozambique, Namibia, South Africa, and Zimbabwe, which took effect from 12:01 a.m. on December 31, 2021. (ET). Vaccination regulations will continue to be enforced. Written by Louanni Ribeiro, Senior Immigration Attorney at Drummond Advisors, and Matheus Etrusco, Paralegal da Drummond Advisors

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AgTech business opportunities for Brazilian companies in the US

To talk about the promising market of Brazilian AgTechs and their possibilities for international expansion, the Brazilian-American Chamber of Commerce of the Southeast (BACC-SE), in partnership with the Consulate General of Brazil in Atlanta, and support from Drummond Advisors, promoted webinar “AgTech Business Opportunities for Brazilian Companies in the US”. The event was attended by Henry Berger, Brazil Country Manager at VetFamily; Marcelo Pereira de Carvalho, CoFounder of AgTech Garage; Diogo Ciasulli, Editorial Director of Feed & Food Magazine; Bernardo Costa, CoFounder of Agroven; Danilo Leão, CEO of Bovcontrol; Fernando Spohr, Operations Manager, North America at Apex-Brasil, and Reginaldo Zandonade, General Manager at Forquimica. The chat was moderated by Pedro Drummond, partner at Drummond Advisors. Lucia Jennnings, president of BACC-SE, opened the panel, which also had the special participation of Ambassador Nestor Forster Jr (Embassy of Brazil in Washington, DC) and Ambassador Carlos Abreu (Consulate General of Brazil in Atlanta). During the live, the speakers commented on the current scenario of AgTechs in Brazil, the challenges and advantages offered by internationalization to the United States, in addition to addressing industry trends for the coming years. Check out the full chat on our YouTube channel (Webinar in Portuguese): Got any questions? Please contact us at info@drummondadvisors.com.

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Live and work in the US: visa types and exclusive tips

To mark the launch of Go Global: Visa Guide, produced by Drummond Advisors, our team of experts hosted webinar “Live and Work in the US: visa types and exclusive tips.” The event had the participation of Louanni Cesario, senior attorney of Business Immigration, Fabiana Guerra, our Legal Director, and Pedro Drummond, partner at Drummond Advisors, the authors of the exclusive material. Check out below the main topics discussed during the webinar and be sure to download your Go Global: Visa Guide (click here). Agencies that make up the American immigration system One of the first points raised by the members of the panel was the importance of getting to know the agencies which are part of the American immigration system. For example, when a company hires or makes a proposal to someone who is eligible for a work visa, they have to go through the US Citizenship and Immigration Services (USCIS), the US government agency responsible for immigration-related matters. In some cases, the visa application must also be submitted for the approval of the Department of Labor, the US government department responsible for labor-related matters. Upon approval of the visa by the USCIS, the consulate of the country in which the applicant resides must validate the application. The entry permit is further validated when the person enters the United States and goes through immigration: at the airport, the document is inspected by the CBP (Custom and Border Protection) Officer. Differences between Family Immigration and Business Immigration Family Immigration is any request for the recognition of a bond with a green card holder or US citizen. As for Business Immigration, it involves all applications not related to any family bonds. These are all work-related entry permits (temporary visa or green card). Concept of American tax residency Another topic discussed was tax residency in the US. A US tax resident is required to file the income tax return in the US and pay taxes under US law. In accordance with the Visa Guide, a foreign national may be considered a US tax resident when: 1. He/she is a permanent resident ( green card holder); or 2. He/she holds a non-immigrant visa and is present on American soil for a period exceeding 183 days, counted as follows: a. Every day he/she was present in the current year, being at least 31 days of presence; plus b. 1/3 of the days he/she was present during the year prior to the current year; plus c. 1/6 of the days he/she was present during the second year prior to the current year. What is the visa selection process? The experts emphasized that the first point that must be identified is the person’s intention within the United States, what are their plans in the country. From there it is possible to define which visa best fits the applicant’s needs. The range of possibilities is wide, which is why it is important to remember that every case is different. There is a specific visa for trainees, such as the H-3, a visa for professionals specialized in a specific, complex function, along with professional academic training, such as the H-1B. There is also a specific permit for transferring executives with specialized knowledge from their country of origin to a company in the United States, such as the L-1. As for academic students, they fall under category F entry permits. In the guide developed by Drummond, you can find detailed information on these and other types of visas and green cards. Got any questions? Please contact us at info@drummondadvisors.com.

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How to Renew your Green Card

The process to renew your Permanent Resident Card is done within 6 months before the expiration of the card. The Green Card renewal is done through form I-90, Application to Replace Permanent Resident Card. If the purpose of the application is to renew the Green Card, the only supporting evidence necessary will be a copy of the expired/expiring Green Card, and if applicable, proof of change of name. The U.S. Citizenship and Immigration Services (USCIS) offers online filing of form I-90 or mailed paper applications, with a filing fee of $455. USCIS gives an estimate timeline to process this application in approximately 5 ½ to 12 ½ months. If the Green Card expires before the renewal is received, the original Receipt Notice will serve as proof of lawful status together with the expired Green Card. There is often confusion between form I-90 and form I-751, Petition to Remove Conditions on Residence: form I-90 is not applicable if you are a Conditional Permanent Resident wishing to remove that condition. Form I-751 is the specific application for those individuals with a 2-year conditional residence. Form I-90 is also used for correction on the Permanent Resident Card, and Replacement if the card is lost or stolen Please note that, if the applicant wishes to become a U.S. Citizen, it is important to check the eligibility to apply for citizenship. Depending on the case, the application for Naturalization can be processed while renewing the Green Card. For more information on your case, feel free to contact info@drummondadvisors.com Written by Bruna Squires, Associate at Drummond Advisors

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