In August 2011, the Supreme Court of Brazil continued the judgment on the constitutionality of the Brazilian Controlled Foreign Corporation (CFC) legislation. The final decision is dependent on a sole justice's opinion, but some conclusions can be drawn from the case so far. In April 2011, the Superior Court of Justice of Brazil also decided one leading case on the CFC rules, which restricted its scope. The case law under review is a signpost that the Brazilian CFC legislation needs to be reformed in order to match reasonable and internationally accepted parameters.
In this article, the author provides an overview of the Brazilian CFC regime. It was originally written as a paper presented at the 2nd London Alumni International Tax Conference, Institute of Advanced Legal Studies, University of London.Intertax