On June 1st of this year, President Jair Bolsonaro sanctioned Law 182/21, which establishes the Legal Framework for Startups and...
Innovative Entrepreneurship. The new legislation introduces measures to encourage the creation of innovative companies, allowing
Investments through the improvement of the business environment in the country.
Indeed, Brazil will experience increasing maturity in its startup ecosystem, impacting the national landscape in an innovative way.
One of the major changes is the definition of what constitutes a startup. Under the new law, they are defined as business or corporate organizations operating in innovation applied to business models or to products and services offered, with annual gross revenue of up to R$ 16 million and up to ten years of registration with the CNPJ (Brazilian National Registry of Legal Entities).
New developments in startup investment.
With the new law enacted, the figure of the angel investor is formalized. This refers to an individual who makes a capital contribution without becoming a shareholder in the company, meaning they do not participate in the organization's management, partnership, or vote in the company's administration, but are remunerated for their contributions.
This measure ensures greater security for the direct investors of the initiative, without them being held responsible for any disputes related to the business or debts, exempting them from any liability on the part of the invested company.
The approval of the Legal Framework for Startups also brings other investment modalities, such as resources from funds and participation in investment programs or calls for proposals. There are requirements for this application, such as ensuring that the financing initiatives are related to innovation.
Experimental regulatory environment and technological innovation
The new legislation of the Legal Framework foresees the possibility of experimental regulatory environment programs, the so-called regulatory sandboxA controlled experimental environment, where the startup can test its solution in a defined context, i.e., within a specific timeframe.
According to the government, this new concept operates under a differentiated regime where companies can launch new experimental products and services with less bureaucracy and more flexibility in their business model. The measure will provide greater legal certainty for startups and companies to innovate, while preserving and supporting the modernization of the regulatory framework.
Also approved was the special bidding process for startups, which will be formalized through the signing of a Public Contract for Innovative Solutions (CPSI).
The bidding process may include an indication of the problem to be solved and the results expected by the Public Administration, including the technological challenges to be overcome. A description of a previously mapped technical solution or technical specifications will not be required, and the proposal of different means to solve the problem will be the responsibility of the bidders.
There is no doubt that the approval of the Legal Framework for Startups is a long-awaited and fundamental achievement for the growth and development of the sector in the country.
We hope that there will be more and more advancements to foster and encourage new business models and innovation.
