Tag Archives: limited liability company

ILN Today Post

The road less travelled – companies’ by-laws can be customised

The “new” Civil Code, which entered into force more than two years ago, has made it possible for businesses to shape, in their own image, the regulations governing their organisation and operation. This opportunity has certainly captured the imagination of legal practitioners. All sorts of extreme ideas were mooted. For example it was suggested that a limited liability company (Kft.) could issue shares or other securities embodying members’ rights. The company courts soon put a dampener on things, however, creating the category of “status rules”: no matter how flexible the law, it still isn’t possible to depart from the rules that constitute the defining features of a particular form of business entity.

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ILN Today Post

Limited Liability Individual Company

On July 11th, 2011, Law # 12.441 changed the Brazilian Civil Code currently in force, creating the figure of the limited liability individual company. In Portuguese, this type of company is called “empresa individual de responsabilidade limitada,” which is being referred to by the initials “EIRELI.”

Individuals have been always able to constitute companies with only one partner, which were called, before the changes introduced in the Brazilian Civil Code in 2002, “firma individual.” After such changes, the designation for such type of company changed to “empresário individual.” Either way, the liability of the individual was unlimited, that is, the patrimony of the individual could be seized for the payment of debts made in name of the company.

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