Nintendo Shuts Down Brazil Operations

Nintendo is officially out of Brazil.

Scub, a Brazilian publication, revealed that the Brazilian division of the Video Juegos Latinoamerica stopped distributing Nintendo products in Brazil after partnering with the gaming company for four years. No replacement distributor has been cited by Nintendo.

Based on a report by IGN, the high import tariffs and other difficulties in the local business environment were among the reasons for the shutdown. The consoles and game titles were significantly more expensive in Brazil compared to other locations around the globe. For example, game titles were sold at $87 while the Wii U was offered at about $830. Kotaku reported that the PlayStation 4 costs around $1,500 while the Xbox One costs only $800. Although there is a huge difference in price between the two contesting consoles, the high retail prices are still due to the high import rates.

Bill van Zyl, Director and General manager of Latin America at Nintendo of America, made an official statement in an IGN report:

"In response to ongoing developments in the Brazilian market, Nintendo of America Inc. today announced changes to the physical distribution of its products in that country. Starting in January 2015, Gaming do Brasil, a wholly-owned subsidiary of Juegos de Video Latinoamérica, GmbH, will no longer distribute Nintendo products in Brazil. Gaming do Brasil has distributed Nintendo products in the country for the past four years. Despite the changes in Brazil, Juegos de Video Latinoamérica will continue to be Nintendo's distributor for Latin America and they remain committed to the brand and the region.

Brazil is an important market for Nintendo and home to many passionate fans but unfortunately challenges on the local business environment have made our current distribution model unsustainable in the country."

He added, "Working together with the Juegos de Video Latinoamerica, we will monitor the evolution of the business environment and evaluate the best way to serve our Brazilian fans in the future."

Engadget revealed that Brazil has imposed high tariff rates on international businesses to protect their local companies. A number of foreign corporations have withdrawn, such as Durham and HTC in 2012. Brazil is also aiming to make more jobs available for the locals, which can be used as an opportunity by foreign companies by creating more factories in Brazil to avoid having to pay the high tax rates. Xbox and other Microsoft products might have been less expensive because the company has a local manufacturing plant.

Nintendo will only continue all direct sales of its products in Brazil until the end of January 2015. There are unauthorized sellers that also offer games and consoles in the country but people who wish to get products from the official source will have to avail soon.