In line with the movements to improve the regulatory environment for capital and attract foreign investment, Law No. 14,286/2021 (Exchange and International Capital Law) and BCB Resolution No. 278/2022[1], They have consolidated new guidelines for reporting economic and financial information from Brazilian companies that receive direct investment from abroad.
Among these obligations is the Five-Year Declaration to the Central Bank of Brazil (BCB), which must be submitted by recipients of foreign direct investment who, as of the base date of December 31 of a calendar year ending in 0 (zero) or 5 (five), hold total assets equal to or greater than R$ 100,000.00.
Although the obligation is not new, its relevance remains strategic, both for its transparency function and for its effects on corporate governance and compliance.
Purpose of the declaration and regulatory impacts
The Five-Year Declaration aims to update and confirm the economic and asset data of Brazilian recipients of foreign direct investment, serving as a basis for:
- monitoring international capital statistics;
- mapping the stock of foreign investment in the country; and
- Formulation of monetary and exchange rate policies.
It is important to note that, in the tax years in which it is required, the Five-Year Declaration replaces the Annual Declaration, avoiding duplication of procedures.
Failure to meet the regulatory deadline may result in administrative penalties and operational restrictions on the Central Bank of Brazil's systems, which reinforces the regulatory nature associated with reporting.
Who must file and what are the criteria?
According to BCB Resolution No. 278/2022, Brazilian recipients of foreign investment are required to cumulatively meet the following requirements:
- Receive foreign direct investment. registered in the Foreign Direct Investment Capital Information System (SCE-IED); and
- Possess total assets equal to or greater than R$ 100,000.00 in data base of December 31, 2025.
Deadline for transmission
Considering the last reference date (December 31, 2025), the corresponding Five-Year Declaration must be submitted by March 31, 2026, through Foreign Direct Investment Capital Information Reporting System (SCE-IED).
It should be noted that non-compliance may result in administrative action, in accordance with the Exchange and International Capital Laws, Law No. 13.506/17 and No. 11.371/06, as well as BCB Resolution No. 131/21.
Relationship with corporate governance and compliance
Beyond the regulatory dimension, the obligation has significant effects on the governance structure, especially for companies with significant foreign capital or those integrated into multinational chains.
Among the sensitive points, the following stand out:
(i) alignment of accounting and corporate data;
(ii) consistency of the declared capital structure;
(iii) traceability of contributions, reductions and reorganizations; and
(iv) communication with foreign investors regarding Brazilian regulatory compliance.
For multinational groups, timely compliance reinforces the level of regulatory maturity, reducing operational and reputational risks.
[1] THE BCB Resolution No. 278 of 12/31/2022 regulated The Law on Exchange Rates and International Capital, in relation to foreign capital in the country, external credit operations and foreign direct investment., as well as providing information to the Central Bank of Brazil.