Code of Ethics
Approves the Code of Professional Ethics of Real State Brokers “Ad referendum” THE PRESIDENT OF CONSELHO FEDERAL DE CORRETORES DE IMÓVEIS [Federal Council of Real State Brokers] – COFECI, making use of its authority granted by article 10, item VIII of Decree No. 81.871 of June 29, 1978,
The agents and agencies licensing system is controlled by COFECI – Real Estate Agents Federal Council, that established a national “reference point” for practice for all States. But, as it could not be avoided in a country as big as Brazil, there are differences regulated by the CRECIs, the Real Estate Agents Regional Councils, in each region or State. All real estate agents must enroll with the Real Estate Agents Regional Councils (CRECIs) . All real estate agencies (legal persons) must have a real estate agent partner as technical responsible. To enroll, the applicant must take the Real Estate Transactions Technician course and apply for an exam. If the agent wishes to work in another region or State away from his or her home (where the Regional Council in which he or she is enrolled is), he or she must transfer his or her enrollment or obtain a temporary enrollment of the Regional Council in which he or she wishes to operate. The enrollments or licenses do not need to be renewed , but annually all professionals and companies pay an annuity to their Regional Council.
The Brazilian authorities encourage foreign investment, as such there are no major restrictions for foreigners to buy and sell residential or commercial property in Brazil. There are however some limitations and/or fees applicable for specific areas such as marine land, Islands, agricultural land and areas near Brazil’s International borders.
Land Registration System
Real estate registration in Brazil is carried out by private notary publics, under the form of a public permission, under Justice control. All real estate registries in Brazil are under control and fiscalization of a State Judge. The real estate registry system in Brazil is quite developed and safe, in which each real estate can only be registered at a single registry, which maintains the entire commercial history and the physical identification of each property. Access to all information on real estate, including ownership, mortgages and liens, is public. In the cities of Brazil, the information has been fully automated.
Other industry professionals
To close a sale, a public deed must be drafted by the notary public, and registered by the real estate registrar. Sales can be entered into directly between sellers and purchasers, but in case of intermediation such activity can only be carried out by an accredited real estate agent or agency. Lawyers are not mandatory, but they are not prohibited in transactions either, and can only represent an interested party the as attorneys-in-fact.
Practitioner services cover both sales and rentals and include: real estate appraisal , marketing (newspapers and placard placement), professional advice to purchasers and potential tenants, contact between the parties through proposals and counterproposals, technical and legal advice for the parties, real estate documentation, drafting of agreements and assistance with public deeds and their registration.
Property Marketing Systems
There have been real estate marketing systems between agents and agencies in Brazil for over 50 years. The Real Estate Assets Chamber of Sao Paulo was established 56 years ago. There are agents or agencies associations, such as clubs, that usually operate as stock exchanges (real estate auctions). More modern computerized systems, such as Multiple Listing Systems (MLS), are recent. There are several MLSs being developed in Brazil, with broad or restricted access to local professionals and companies. Examples are the SIEX of Secovi-SP, the real estate portal planetaimovel.com, the Brazilian Real Estate Network lead by realty Coelho da Fonseca in Sao Paulo, and other systems in several medium and large cities in Brazil. There is not currently a national system.
There is no national referral system in Brazil but the concept of sharing commission is accepted. Most real estate companies are local. Few of them are regional (market in more than one city or state), but none on them is national. The large ones are accustomed to working with foreign investors and they are familiar to the referral systems. International real estate companies or franchises such as Colliers, CB Richard Ellis, Jones Lang LaSalle, Cushman Wakefield, etc. have branches in major cities in Brazil. It is not common to find a real estate company involved in other business than real estate. Referrals are not regulated yet.
Relationship of Buyer/Seller to Practitioner
The purchase and sale of property is regulated mainly by two federal laws: The Real Estate Agent Law (Law number 6530 of 1978), and the Consumer Defense Code (Law number 8078 of 1990). It does not matter whether there is a written agreement or not (although the Real Estate Agent Law requires written agreements . The Brazilian legislation is quite modern in its protection of customers rights. In general, agreements are entered into with the sellers or with the landlords (owners).
Remuneration is paid by means of commission (a percentage over the sale or rental value), and always by the seller or landlord, as determined by the real estate agents legislation. The payment occurs when the agreements are signed and when the sale or rental closes. Commission rates are determined regionally by the Regional Councils (CRECIs). In general, the funds involved in the transactions are paid and received directly by the parties, but with previous written consent the intermediaries (real estate agents or real estate agencies) can receive funds for later account settlements.