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Non-resident Account

The reconfiguration of the international business environment in Brazil, driven by the Foreign Exchange Framework (Law No. 14,286/2021), has positioned the non-resident account (NRA) as a strategic instrument for companies with global operations. The new legislation removed regulatory constraints, largely equating the treatment of resident and non-resident accounts, which unlocked a series of operational and tax advantages.

A non-resident account is a deposit account held in Brazil by an individual or legal entity domiciled or headquartered abroad. Under the new regulations, these accounts can be maintained in both local currency (Reais) and foreign currency.

Competitive Advantages and Cash Flow Optimization

The strategic use of an NRA by a company generates direct operational advantages that translate into financial gains—the main advantage lies in the centralization and netting of international flows.

Companies that simultaneously have receivables (exports, capital contributions) and payables (imports, royalties, services, interest) in foreign currency can use the account to optimize their flow. Instead of settling each FX operation individually—a process that incurs bank spread and IOF costs for each transaction—the company can consolidate these flows. This possible optimization of the financial flow results in:

  • Reduction of Transaction Costs: Fewer FX contracts mean less payment of bank spreads.
  • Operational Agility: Payments and receipts are processed more quickly, without the need for multiple FX closings.
  • Natural Hedge: By keeping funds in foreign currency, the company mitigates the risk of exchange rate variation for its short-term obligations in the same currency, creating a passive and cost-free hedge.

Tax Optimization

By centralizing receipts and payments in foreign currency and carrying out netting directly in the account, the company minimizes the need to convert currencies.

This directly impacts the IOF-FX, as the tax is levied on the settlement of each FX contract. Fewer operations mean a lower tax base and, consequently, lower potential tax cost. Additionally, although it does not change the Withholding Income Tax (IRRF) rates, centralized management organizes and simplifies the flow of payments abroad, facilitating compliance and tax control over remittances.

Case Study - E-commerce Marketplace Optimization

AliExpress, headquartered in China, operates as a marketplace for millions of consumers in Brazil. The platform does not have significant local inventory; it connects international sellers (mostly Chinese) to Brazilian buyers.

The platform processes a huge volume of low-value payments in Reais (BRL), received through multiple methods (Pix, boleto, credit card) via local payment partners (gateways and fintechs).

The central challenge is to consolidate these amounts and remit them efficiently to thousands of sellers in China, who need to receive in hard currency (USD or CNY). For the case study, let's consider a monthly sales volume of R$ 500 million.

Conventional Operational Model

The model without a non-resident account forces AliExpress to use a local payment partner who collects the Reais in its own account. To remit the funds, this partner executes multiple and frequent FX contracts, negotiating rates tactically and less advantageously for each operation. The result of this model has several disadvantages:

  1. Dispersed Collection: The local payment partner collects the R$500 million in its own account.

  2. Multiple FX Contracts: To remit the funds to sellers, the platform (or its partner) would need to execute frequent and large FX operations to buy foreign currency with the Reais balance. The FX operation would be done on the gross volume.

  3. Costs and Inefficiencies:

    • Spread Cost: FX rate negotiation is done reactively and in a fragmented way—assuming an average spread of 0.30% on less structured operations, the cost would be R$1,500,000 per month (R$500,000,000 × 0.30%).
    • IOF Risk: The total volume of R$500 million would be exposed to the current IOF-FX rate, representing significant regulatory and tax risk.

  4. Operational Complexity: Treasury management becomes extremely complex, with low visibility and control over the BRL cash before conversion.

Operational Model with a Non-Resident Account in Reais

AliExpress's legal entity in China (the non-resident) opens a non-resident account in Reais in Brazil and the local payment partner, instead of holding the funds, transfers the total amount collected (R$500 million) directly to AliExpress's non-resident account. At this point, the ownership of the funds in Reais is already with the foreign entity, but within the Brazilian financial system. Advantages of the model through the operational model:

  1. Centralized Cash Management: AliExpress's global treasury now has control and full visibility over its cash in Reais. Before any conversion, it can use these funds to pay local expenses it may have (such as marketing or legal services), further optimizing the flow.

  2. Strategic FX Execution: Instead of multiple operations, the treasury can execute a single, massive FX operation to convert the net BRL balance to USD/CNY. With such a large volume, the company gains immense bargaining power with banks.

  3. Numerical Advantage:

    • Bargaining Power on the Spread: Centralizing the volume allows negotiating institutional rates—the spread for a single, structured operation of R$500 million could be negotiated to, for example, 0.15%.
    • New Spread Cost: R$750,000 (R$500,000,000 × 0.15%) per month.
    • Direct Monthly Savings: Compared to the previous model: R$1,500,000 − R$750,000 = R$750,000.
    • Annual Savings: The optimization generates a direct financial gain of R$9 million per year, just from the reduction in FX spread.

  4. Treasury Efficiency: The process is simplified, operational risk is reduced, and the company can choose the best time to convert, taking advantage of more favorable market conditions.

This model demonstrates how the non-resident account transforms a logistical and high-cost challenge into a strategic advantage, allowing the marketplace to operate in Brazil with drastically optimized treasury efficiency and cost structure.