A German telecommunications company purchasing a telecommunications company in Brazil creates what type of corporate structure?

When a German telecommunications company acquires a telecommunications company in Brazil, it establishes a foreign subsidiary. This occurs because the German company is creating a new entity that operates in Brazil, fully owned by the parent company in Germany. The foreign subsidiary operates under the local laws and regulations of Brazil while being part of a larger international corporate structure.

This corporate structure allows the German company to have direct control over its Brazilian operations, enabling it to implement its strategies and policies effectively while also potentially benefiting from local expertise in the Brazilian market. By creating a foreign subsidiary, the company can also directly respond to local market conditions and consumer preferences, thus enhancing its competitive position in Brazil.

In contrast to other options, a joint venture would involve sharing ownership and decision-making with a local partner in Brazil, which is not the case in a full acquisition. A franchise would involve granting another party rights to operate using the parent company's brand, which is different from outright purchasing another company. Lastly, a trade agreement refers to international treaties that facilitate trade between countries but does not pertain to corporate ownership structures.