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EU-Mercosur tariffs are open. Italian greenwashing fines are live. Here is what a Brazilian exporter must do before the first shipment lands in Europe.
The provisional application of the EU-Mercosur agreement, in force since 1 May 2026, cut average EU tariffs on Brazilian industrial goods. For some product categories the reduction amounts to 35 percentage points across the phase-in period. That is not a background fact. That is the difference between a margin and a loss on competitively priced goods. Brazilian exporters are moving fast to capture it. Moving fast without the right Italian legal structure is where the serious mistakes begin.
No, not always — but the question is the wrong starting point. The real question is: how will you invoice, import, hold stock and enforce contracts in Italy without a local legal presence?
A Brazilian company can sell directly into Italy through a distributor, but it will have no Italian VAT number (partita IVA, partita IVA), no Italian tax code (codice fiscale), and no ability to invoice Italian buyers under standard B2B terms without triggering a permanent establishment analysis. The moment you appoint someone in Italy who habitually concludes contracts on your behalf, Italian law treats you as present — and taxable — in Italy, regardless of what your Brazilian entity does.
An Italian Srl — a società a responsabilità limitata, the Italian limited liability company — resolves this neatly / cuts through this neatly. Under Articles 2462 to 2483 of the Italian Civil Code (codice civile), an Srl requires a minimum share capital of €10,000, at least 25% of which must be paid up at incorporation. A sole shareholder is permitted. Registration at the local Chamber of Commerce (Camera di Commercio) takes approximately ten to fifteen working days once the deed is notarised. Add two to three weeks for the Italian tax code and Italian VAT number registration with the Agenzia delle Entrate (Italy's national tax authority). Budget between €3,000 and €5,000 in notarial fees and registration costs, depending on the province and the structure chosen.
For a Brazilian group, the Srl becomes the EU hub: it imports the goods, warehouses them, invoices EU customers and pays dividends up the chain / upstreams dividends. The Italy–Brazil double taxation convention of 1978 governs how those dividends are taxed at source.
This is the mistake that costs the most money, and it almost never surfaces until the relationship ends.
Italian law draws a sharp line between a distributor and a commercial agent. A distributor buys stock from you, takes the commercial risk, and resells. A commercial agent — regulated under Legislative Decree No. 65 of 10 September 1999 (D.Lgs. 65/1999), implementing the EU Commercial Agents Directive 86/653/EEC — promotes your goods on your behalf without taking title to them. The agent earns commission. The agent does not bear inventory risk.
The critical point: if the Italian party you called a "distributor" in your contract actually takes orders on your behalf, transmits them to you for fulfilment, and earns a margin calculated as a percentage of the invoice, Italian courts will requalify that person as a commercial agent. The contractual label is irrelevant; economic substance controls.
Why does this matter? Because Article 1751 of the Italian Civil Code grants a commercial agent a mandatory indemnity on termination — up to one year of average annual commissions — that cannot be excluded by contract, whatever the parties agreed. This is not a default rule that a well-drafted agreement can exclude. It is inderogabile: mandatory by law. A Brazilian company that has paid its "distributor" a 12% margin on €2 million of annual sales for three years and then switches to its own Srl may find itself facing an indemnity claim of €240,000 or more, plus litigation costs, simply because the original arrangement was never properly structured.
Unlike in most common-law countries — where the parties are largely free to define the agency relationship and its consequences by contract — Italian law (following the EU Directive) imposes the indemnity floor regardless of bargaining power. There is no opt-out. An English company or a US firm accustomed to at-will distribution terminations will find this counterintuitive. Brazilian law has its own protection mechanisms for commercial representatives under Law No. 4,886/1965, so your Brazilian lawyers will be familiar with the concept, but the Italian calculation method differs and the Italian courts apply it strictly.
The practical fix is to draft the commercial agreement before any goods move, and to decide at that stage — deliberately — whether the Italian party is a genuine distributor taking stock risk or a commercial agent. The answer changes the contract, the pricing model and the exit strategy.
Yes. And the fine can reach €10 million or 4% of annual global turnover, whichever is higher.
Italian Legislative Decree No. 30 of 4 March 2026 (D.Lgs. 30/2026) implements EU Directive 2024/825/EU on empowering consumers for the green transition. Its Article 2 prohibits generic environmental claims — words like "eco," "natural," "sustainable," "Amazon-friendly," "responsible sourcing" — unless they are substantiated by an approved certification scheme or an explicit, verifiable reference to recognised environmental performance criteria. The prohibition became applicable across all EU Member States from 27 September 2026.
The authority that enforces this in Italy is the AGCM, the Autorità Garante della Concorrenza e del Mercato (Italy's competition and consumer protection regulator). The AGCM has already sanctioned several foreign brands for misleading environmental claims before the Decree; with the new rules in force, its powers are substantially wider.
Brazilian exporters face a specific exposure. Many Brazilian products in the food, cosmetics, textiles and timber sectors carry marketing language that emphasises Amazonian or cerrado provenance, sustainable harvesting, or zero-deforestation sourcing. These claims are commercially valuable — and in the Italian market, they are now legally dangerous unless backed by a certification recognised in the EU. Brazilian certifications that are not cross-referenced to EU standards may not be sufficient. The AGCM does not care where the certification was issued; it cares whether the claim meets the standard set out in the Decree.
The greenwashing review should happen before the product packaging is finalised for EU distribution, before the Italian website copy goes live, and before the distribution agreement defines what claims the Italian partner is authorised to make on your behalf. Vesting the right to make sustainability claims in the Italian distributor without controlling what is said is a separate liability risk: under the Decree, both the supplier and the distributor can be held responsible.
Three specific errors appear together in the files of Brazilian companies entering Italy through informal arrangements, and none of them is discussed in the English-language commentary on EU-Mercosur market entry.
The first is assigning intellectual property and sustainability claim ownership to the Italian distributor in the distribution agreement. If the relationship ends, the Brazilian brand may find that the Italian party owns the local trademark and the certified environmental claims that took years to build. The Srl structure, with IP held at the holding level, prevents this.
The second is the mis-classification of the commercial relationship described above. An exclusivity letter exchanged by email before any lawyer is involved is enough to create an agency relationship in Italian law if the economic substance fits. By the time the Brazilian company realises this, the indemnity has accrued.
The third is the greenwashing gap. The Brazilian parent company believes its certification is solid — it may hold a Cerflor, an FSC, or a Rainforest Alliance certificate. But the Decree requires that the certification be issued by a body accredited under a scheme recognised in the EU, or that the claim be linked to an explicit, verifiable environmental performance standard. A certification that satisfies Brazilian law or US market practice is not automatically sufficient. The review must map each claim against Article 2 of the Decree and, where gaps exist, either obtain the required EU-recognised certification or remove the claim from EU-facing materials.
Verba volant, scripta manent — spoken words fly away, written words remain. In Italian commercial practice, what is written in the agreement and on the label is what the regulator reads. Unwritten assumptions from the Brazilian side do not travel.
As the scholar of international commercial law Filip De Ly observed in his analysis of transnational commercial practice, the most dangerous gap in cross-border transactions is not the conflict between legal systems — it is the assumption that no gap exists.
There are four, in sequence, and they are not interchangeable.
Decide the legal vehicle first. If annual Italian sales are expected to exceed €500,000 within two years, the Srl is almost always the right answer. Below that threshold, a carefully structured distribution agreement may work — but only if the commercial agent risk is addressed explicitly.
Draft the commercial agreement before any goods move. Define whether the Italian party is a distributor or a commercial agent. If it is a distributor, confirm that it bears genuine stock risk. If there is any doubt, treat it as an agent and calculate the indemnity exposure into the business plan.
Run the greenwashing review against Legislative Decree No. 30/2026 before finalising packaging and digital marketing. Map every environmental claim to its evidentiary basis. Where the basis is a Brazilian certification, check whether it qualifies under the Decree's requirements or whether bridging EU certification is needed.
Register the Italian company, obtain the Italian VAT number and Italian tax code, and open the Italian bank account. The notarial deed of sale (rogito notarile) for property, if the Srl will hold premises, comes after the company exists — not before.
In our files, the most common mistake is the email exclusivity letter — a one-page document sent before any lawyer is involved, granting an Italian party exclusive rights to a territory or a product line. By the time the Brazilian company engages Italian counsel, the letter has created an agency-style relationship in substance, the Italian party has been investing in market development for twelve to eighteen months, and the mandatory indemnity calculation already runs to six figures. The cost of a properly structured distribution agreement at the outset is a fraction of that figure. The Srl incorporation and commercial agreement should be handled simultaneously, not sequentially.
How long does it take to set up an Italian Srl for a Brazilian company?
With documentation prepared in advance, incorporation before an Italian notary and registration at the Chamber of Commerce takes approximately three to five weeks. Add two to three weeks for the Italian VAT number and tax code registration. The full process from instruction to operational company is typically six to eight weeks. Apostille of Brazilian corporate documents is required; Brazil has been party to the Hague Apostille Convention since 2016, with apostilles issued by the CNJ.
Is the EU-Mercosur agreement already in force for Brazilian goods entering Italy?
The agreement has been provisionally applied since 1 May 2026, meaning tariff reductions are already being phased in for eligible Brazilian goods. The full ratification process by EU Member States is ongoing. Brazilian exporters should verify the current tariff schedule for their specific product categories at the date of shipment, as phase-in rates change annually.
Does a Brazilian company need to certify its environmental claims before selling in Italy?
Yes, if those claims will appear on product packaging, the Italian website or in advertising. Under Legislative Decree No. 30/2026, generic environmental terms are prohibited without substantiation through an EU-recognised certification or explicit, verifiable environmental performance criteria. The AGCM enforces this with fines up to €10 million. A pre-launch claim audit against the Decree is not optional for any Brazilian brand whose marketing relies on environmental or sustainability messaging.
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SUGGESTED INTERNAL LINKS: Italian Subsidiary Brazilian Company: Setup Guide (/en/italian-subsidiary-brazilian-company-setup)
Editorial Team — Panato Law Firm Staff
