I have been addressing the topic of the rural holding company in my most recent articles, a model that is gaining more and more ground in the Brazilian agricultural scene. This is because this business model has proven to be promising in terms of asset sustainability, succession, and tax savings.
When rural owners decide to follow this path, it is necessary to rely on the support of a specialized team that ensures legal certainty and promotes the training of all the partners of the rural holding company, present and future. In this respect, in addition to ensuring compliance with the numerous legal provisions and guiding those involved, the attorney must be an important ally for the business.
Compliance with the laws
The incorporation of a rural holding company involves several fields of Law, such as Tax, Contract, Family and Succession, and Corporate Law. For this reason, relying on a multidisciplinary team is essential for the success of this undertaking.
In this sense, federal, state, and municipal laws must be observed, as well as specific regulations. There may even be a need to seek reconciliation with international laws or those of other countries, as for example in the case where one or more heirs are not Brazilian, or even if the marriage of one or more heirs was not registered in Brazil, but rather abroad.
Only attorneys specialized in the areas above will be able to ensure the technical perspective necessary to verify, in each case, which laws and regulations are applicable and which are the best paths.
In addition to legal knowledge, there are many gains in the process of incorporating a rural holding company if the multidisciplinary team has a specialist in management and corporate governance. In this way, the new company is already born in line with all the current trends in the business world.
To start a company, whether in the agricultural sector or not, it is necessary to base it on solid foundations; that is, with legal certainty and longevity for the business.
Main legal services in a rural holding company
Check below the most common legal services in the incorporation of a rural holding company.
- Asset valuation: research of the value of the real property at official agencies and analysis of financial and accounting documents, such as the Income Tax return.
- Continuous mentoring: periodic conversations with the rural producer and their family to raise awareness about changes and clarify doubts, in order to guide everyone through this process with security and confidence.
- Corporate structuring: documental organization regarding the business in relation to partners, clients, and partners, as well as the tax organization of the company.
- Contracts: drafting of the company’s articles of association and of all ancillary contracts, such as donation and partners’ agreement, among others.
- ITBI exemption: administrative request for the non-levy of the tax on the transfer of real property upon the transfer of the properties to the asset holding company, and follow-up until approval.
- Registration: registration of the incorporation of the asset holding company at the real property registry offices for the transfer of ownership of the properties to the asset holding company.
- Donations: formalization of any donation of the rural holding company’s corporate shares to legal successors and submission of a donation declaration to the State Treasury for purposes of collecting the tax on transfers by reason of death and donation (ITCMD).
- Legal advisory: follow-up of all procedures by specialized professionals until the completion of the process of transferring the rural producer’s assets to the rural holding company.
- Management and corporate governance: separation between management and ownership; deliberation by the majority, reducing the risks that any misalignment of the partners interferes with the management of the holding company, and transparency of economic information.
Knowledge of the agribusiness sector
It is also important that the team involved has experience and knowledge of the agribusiness sector, in order to have the necessary repertoire for advising the family, accurately assessing the assets, and correctly calculating tax savings, since there is great variation depending on what is produced and where.
Another relevant point is to rely on a systematized work process for the incorporation of a rural holding company, ensuring precision, efficiency, and agility in all procedures.
In our experience and practice with the incorporation of a rural holding company here at Lassori Advogados, we can affirm that these two aspects bring many gains, especially in advising, counseling, and clarifying matters for the family and in defining the roles and responsibilities of each one.
In conclusion, the incorporation of a rural holding company is an important strategy for the longevity of businesses in the agricultural sector, provided that it is conducted by a specialized multidisciplinary team that ensures security and confidence.
Therefore, before making the decision to incorporate a rural holding company, consult a specialist attorney to learn more and understand how to do it.
Read more:
Check the benefits of incorporating a rural holding company
By Glauber Ortolan – previously published on the attorney’s profile
← Back to blog