Buying rural property in Brazil as a foreigner is prohibited in certain circumstances. We covered the restrictions on buying rural property in a previous article. But what about leasing rural property?

A rural property lease, or Arrendamento Rural, is defined as the agrarian contract for the exploitation of land in exchange for remuneration or rent. Foreign individuals and legal entities can lease Brazilian rural property. However, here too there are restrictions and required formalities.

Local presence is the first rule. Foreign individuals must be permanent residents of Brazil, while companies must be authorized to do business in Brazil. Brazilian entities owned by non-resident foreign individuals or international companies are subject to the same legal restrictions.

There are also restrictions related to the size of the land. These are the same restrictions that apply to foreigners who buy rural property. For example, foreigners as a group can’t occupy more than ¼ of the municipality where the property is located.

Rural property leased by foreigners must have a written agreement with the terms documented in a public deed (escritura) and then registered with the real estate notary office. The notary then files the deed in a special book, the Livro de Registro de Aquisição de Imóveis Rurais por Estrangeiros.

Matters involving rural property owned or leased by foreigners in Brazil are full of nuances. Hence the importance of having knowledgeable counsel to advise and prepare what’s necessary for a successful, and more importantly, enforceable transaction.