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Posts Tagged ‘Brazilian News’
June 28, 2013
Decree to Negate IOF tax
Earlier this year, the Brazilian government reduced the tax rate on financial transactions (IOF) on certain infrastructure-related investments to 0 percent. The IOF is generally applicable on credit and currency exchange and insurance and securities transactions including intercompany loans and gold transactions.
It will affect infrastructure-related investment transactions including:
- Production of consumption assets for export.
- Research and development projects including technical and engineering.
- Infrastructure logistic investment for roads and rail.
- Investment in power or energy sector.
Now the Finance Minister, Guido Mantega, has ordered a decree that will expand the tax rate to foreign capital in fixed income investments, primarily in Treasury notes. The previous rate was set at 6 percent.
This decision will help increase the inflow of funds into the country and reduce the devaluation of the real against the U.S. dollar – which has gained momentum recently after the U.S. Federal Reserve reduced the purchase of assets and has planned increases in interest rates in the near future. These moves have caused added inflationary expectations and increased pressure on the Brazilian government to oust the rate.
An increase in foreign funds could help the country get past the current riots that are taking place in numerous cities. One of the biggest issues the citizens are speaking out against is the money going toward the World Cup instead of schools and healthcare.
Any company that does, or is planning on doing business in Brazil, would be wise to partner with Brazilian lawyers to make sure they understand all of the changes to tax rates.
June 27, 2013
Protest Against PEC37
Earlier this month, we covered an announcement from the Brazilian Council of Justice (CNJ) where they came out against the “PEC 37” measure. It is a piece of legislation that, if passed, would limit the investigative powers of federal prosecutors, something many feared would make it harder to prosecute official corruption.
Members of the CNJ called the bill “disastrous” and said it would be the “suicide” of the country’s judicial system. It would be like limiting the ability of the FBI to investigate corruption.
Yesterday, that bill was voted on by Brazil’s lower house of congress and the final count was 403-9 against the legislation. Many experts are crediting the current protests that are sweeping the country for helping to defeat the bill.
According to a Sports Illustrated article, before the demonstrations broke out on June 17 – which started over a transportation fare hike and now engulf numerous government spending issues – the PEC 37 bill appeared to be heading for an easy victory in its first vote. Since then, many citizens have been seen holding signs against the bill at protests over the last few weeks.
“It was on the streets that the blindness of the politicians was lifted,” Domingos Dutra, a congressman who has often butted heads with leaders of his ruling Workers Party, told the news source.
This defeat shows what is capable from these protests. Anyone that has business in the country would be wise to partner with Brazilian lawyers to stay updated on any changes to the laws that could come out of these protests.
June 25, 2013
Suspension on Pro Bono
This week, the Brazilian BAR Association (OAB) suspended the guidelines that regulate Pro Bono legal work until the group is able to create and adopt a set of rules that governs the institute.
This move is an order from federal councilor Luiz Flavio Borges D’Urso on the grounds that there is currently no “national guideline.” As it stands now, some districts have created rules for the practice of Pro Bono legal work but this lack of a uniformed ideal has caused a series of misunderstandings. Most of this comes from “confusion recently established along with the public opinion” and the idea that Pro Bono is a free service instead of the actual system that renders services in a private manner by a Brazilian lawyer “deemed as true charity.”
“Considering that ‘Pro Bono’ needs a uniform regulation for the whole of Brazil, by constituting a true system and therefore being guided by well-defined rules in order to avoid the doubts and confusion already experienced,” said the counselor.
The National president of the OAB, Marcos Vinicius Furtado Coelho, is forming a commission to formulate a body of rules that will need to be submitted and approved by the council. There is no timetable for the committee to reach a decision on this matter.
Because of this, any company or individual that has business in Brazil should be wise to partner with lawyers from Brazil to make sure they understand the current landscape and there is nothing unforeseen that could lead to trouble.
June 24, 2013
Debate on the Penal Code
When the wording and specific elements of a particular law are being debated, there are sure to be varying viewpoints on every side. However, when you reform the entire penal code, that debate is sure to get intense.
Currently, there is a movement in Brazil to update the country’s Penal Code (CPB). Created in 1940, it is a piece of legislation that outlines punishment for more than three hundred types of criminal activity. It is currently up for renewal with several proposed updates to the language, sentence lengths and crimes that are causing some controversy.
One of the main points is the inclusion of newer forms of crime that were not around in the 1940s when the original penal code was drafted or have evolved into something different in the last 70 plus years. That includes things like white-collar offenses, criminal organizations and the “Carolina Dieckmann Law” which deals with the invasion of privacy in social media.
The next and final public hearing to debate the bill will be on July 7 at the auditorium of the Foundation of the Superior Law School of the State of Ceará. Senator Eunicio Oliveira of Ceara, a member of the Commission on the Reform of the Penal Code, will be present as Brazilian lawyers and citizens are able to voice their concerns over the bill and what it could mean for the country.
There are many changes—both positive and negative—that are being proposed as part of this Penal Code restructuring. However, as it turns out, anyone with business in Brazil should partner with lawyers from the country to make sure they understand the new laws.
June 21, 2013
Protest against PEC37
The protests in Brazil are getting stronger by the day and thousands of citizens are voicing their displeasure with several different government policies and the funding of the 2014 World Cup.
On the topics that is being protested is the June 26 vote on PEC 37, an amendment to the Brazilian constitution that will make it impossible for the Department of Public Prosecution to investigate corruption and human rights crimes committed by public officials. It would make the Brazilian police force the sole investigator of crime. That group is essentially Brazil’s version of the FBI.
This week the Brazilian Council of Justice (CNJ) released a statement coming out against the PEC. Joaquim Barbosa, the president of the CNJ, said the amendment is “suicide” for the criminal justice system which would just “boast its flaws.”
The CNJ is traditionally quiet when it comes to legislation but felt the need to speak on this because it could be “disastrous” to the democracy for all the investigatory powers be concentrated with the police.
“The CNJ is cautious in pronouncements of this nature and externalizes its position only in situations in which it perceives a serious risk to the guiding principles of the democratic State of Law, with possible consequences that would compromise the separation of powers”, says the statement.
It goes on to encourage the congress to reject the initiative because it if it passes it will make an already bad situation worse.
With criminal investigation changing, any individual or company that has business in the country would be wise to partner with Brazilian lawyers to ensure they are not caught off guard.
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