FEATURES
inspection for fire department and sanitary licenses, attesting that safety and health conditions are in accordance with the law;
certificates called PPRA (Prevention Program Environmental Risks) and PCMSO (Control Program of Medical Occupational Health);
HABITE-SE, an authorization for occupancy of the building; and
An operation permit, issued by a mayor to authorize the operation of businesses at certain times, the practice of certain activities, etc.
In addition to these licenses and permits, every
company must be duly incorporated, demonstrating the establishment of its corporate structure, a CNPJ (National Register of Legal Entities), as well as register corporate papers in the Commercial Registry Office (public state agencies that regulate commercial activities and businesses) and register the construction project in the Real Estate Registry Office. Fortunately, many competent professional consulting
firms, lawyers and experts in Brazil have extensive experience with the challenges that entrants to the Brazilian market face in meeting legal and regulatory requirements, and can help in overcoming them.
2) The Brazilian tax system can also raise concerns
among companies unaccustomed to the tangle of laws that regulate and organize the business activities of all companies. Each of the three levels of Brazilian government has
the right to receive and collect taxes on a wide range of activities that generate these charges, such as payroll, circulation of goods, industrial production and income. Still, most companies have found solutions to offset
the enormous tax burden that represents the biggest hurdle affecting Brazilian industries’ competitiveness, including setting the price of their products, improving strategies to stimulate consumer demand, and obtaining legal benefits when the company runs activities that offer social, environmental and economic advantages for society.
3) Environmental risks may occur in the acquisition of
a piece of land or area or with the impact of waste produced by business, commercial or industrial activities. Such issues are especially complex in Brazil because of increasingly stringent legislation verifying, compensating and punishing companies that do not comply with rules related to all aspects of environmental protection. (One of the duties of the Public Prosecutor, for instance, is to ensure that environmental legislation is obeyed.) When an environmental infraction occurs, Brazilian law
allows the company responsible for the damage to be heavily punished, from the imposition of a fine to the obligation to comply with various counterparts, and, in a much more severe case, it can even lead to the arrest of those who are convicted of environmental crimes. The challenge to develop an environmentally sensitive
project has been overcome when businesses and entrepreneurs create sustainability programs, which increasingly appeal to Brazilian consumers who attribute a significant value to this kind of initiative.
Conclusion Although the challenges facing a new shopping center
or retail operation in Brazil can be complex, they can be easily overcome if new entrants have plans in place to fulfill all requirements for managing their business in a positive, secure way. Not only economic concerns, but also social and
environmental factors are relevant for a company to achieve its objectives. Included in this process is analysis of the trade area, such as appropriate economic planning for absorbing social, tax and labor costs. By adopting an appropriate marketing position (price, product and place), it is likely that any company that intends to establish a business in Brazil will achieve its goals. Indeed, new entrants following these procedures will
find strong demand from Brazilian shoppers, who are increasingly open to better products, different solutions and more modern consuming experiences. Great opportunities exist for creative, ambitious and structured companies with a strong purpose to accomplish their plans for expansion, creating value not just for partners and shareholders, but also for society as a whole.
INTERNATIONAL COUNCIL OF SHOPPING CENTERS
22 4
RETAIL PROPERTY INSIGHTS VOL. 20, NO. 1, 2013
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