Brazilian Customs made a positive (and very welcome!) step towards the simplification process to grant the registration and identification number to businesses wishing to import to or export from Brazil.
What is RADAR
Since decades, businesses wishing to trade in Brazil require an authorization from Customs Authorities, referred to as "RADAR." It is through RADAR that Brazilian Customs keeps track of statistics and the security profile of importers and exporters, which is in line with the compliance programs being implemented all over the world (Authorized Economic Operator, C-TPAT, etc.). RADAR grants access to the electronic portal of Customs (SISCOMEX) through which customs declarations are filed.
RADAR is comparable to the EORI number in the European Union (EU) and the Importer Number in the United States of America (USA). The process and requirements to get a RADAR assigned in Brazil, however, have been far away from comparison to those in the EU or USA.
A long road of amendments
The legislation in Brazil governing the RADAR rules was amended multiple times. The last major update came into force in 2012, when three modalities of RADAR were implemented: (i) express, (ii) limited and (iii) unlimited modalities. To get one or the other type of authorization assigned is dependent on the financial capability of the business to perform import (and export) transactions, the related amount of those transactions and intended volume.
In the past, there was a lot of paperwork - and to a certain extent bureaucracy - involved in the application process. Some businesses were even required to present - in addition to all regular documents - the bank statement to prove the financial capability of the Company in order to get the unlimited authorization.
A new legislation came into force in 2015 and with that the paperwork for the application process reduced quite significantly. The application process itself, however, remained the same: requests had to be filed in person by the legal representative or someone empowered to do so. The processing of the applications by Brazilian Customs (RFB) could take weeks or even months. As a result, RADAR was quite often named as one of the most critical steps that could jeopardize the start-up of businesses in Brazil.
Facilitation through "Portal Habilita"
No more paperwork. Online applications have been implemented through "Portal Habilita," launched at the end of July by Brazilian Customs.
A 3-step-process which includes accessing the website with the digital certificate, completing the application and submitting the form for analysis now suffices. Depending on the modality applied, the authorization can be granted instantly. For the unlimited modality (which is the one needed for Companies importing in value more than USD 150k per semester), the timeline for analysis by Brazilian Customs is expected to be reduced to 10 days. It is further expected that only in exceptional cases will the applicant be required to appear at the Brazilian Customs Office in person.
Brazil is taking major steps towards customs and trade facilitation and simplification, which is supported by its accession process to the Revised Kyoto Convention of the World Customs Organization ("the blueprint for modern and efficient Customs procedures in the 21st century"). "Portal Habilita" is a small piece of that. For 2020 a new software based on cutting-edge technology and single-window principles is planned to be launched to manage the customs environment. Doing business in Brazil is expected to become more attractive - at least from a Customs perspective.
This alert was co-authored by Marcelle Silbiger De Stefano (Tax Associate at Trench, Rossi e Watanabe Advogados - in cooperation with Baker McKenzie).