The Agribusiness Newsletter brings information and news about the main regulations and legal texts relating to the regulation of agribusiness in Brazil. This initiative seeks to cover the agribusiness industry on its transactional, litigation, tax and regulatory levels, and is an invitation for all of those working in this market to both access important news and comments on vital topics from the sector.

This material is for informative purposes only, and should not be used for decision-making. Specific legal advice can be provided by our legal team.

NEWS

Income distribution in FIAGRO: ANBIMA submits letter to CVM on the topic

On July 01, 2024, the Brazilian Association of Financial and Capital Market Entities (“ANBIMA”) submitted a letter to the Brazilian Securities and Exchange Commission (“CVM”) with questions regarding the distribution of income in Investment Funds in Agroindustrial Productive Chains (“FIAGRO”).

In this letter, ANBIMA expressed concerns about the accounting treatment of FIAGRO, which is governed by CVM Resolution 39 of July 13, 2021, as amended. Since their creation, these funds have recorded an increase of 2,096.50% in net assets, 155,453.17% in the number of accounts, and 1,371.43% in the number of funds, accounting for 780,000 accounts and 103 funds by April 2024, totaling net assets of BRL 36 million.

According to ANBIMA, the market remains uncertain as to the basis for calculating the income distribution from FIAGRO and, therefore, defends the need for clarification from the regulatory body through an appropriate instrument.

Law No. 8,668, of June 25, 1993, provides for the incorporation and tax regime of Real Estate Investment Funds (“FII”) and FIAGRO and, in its article 10, sole paragraph, requires FIIs to distribute at least 95% of profits earned on a cash basis every six months. It is worth noting, however, that article 20-F of Law No. 8,668 does not provide for the applicability of the sole paragraph of article 10 to FIAGRO and, as such, these funds are not subject to the type of income distribution applicable to FIIs and must comply with accounting profit, using the accrual basis. This position also applies to the income distribution from Real Estate FIAGRO, reiterating that it must comply with accounting profit.

Thus, a clarification from the CVM on the subject is expected.

For more information: Letter to CVM | Income Distribution in Investment Funds in Agroindustrial Productive Chains (“FIAGRO”) .

ANBIMA and CVM include FIAGRO-FII and infrastructure fund offerings in agreements

On July 08, 2024, ANBIMA and the CVM announced an important update to the technical cooperation agreement on public offerings: the issuances of Real Estate FIAGRO (“FIAGRO-FII”) and Infrastructure Funds (“FI-Infra”) will now be eligible for prior evaluation by ANBIMA.

This change aims to improve and streamline the process of registering these offerings.

The agreement between the two institutions, which has been in place since 2008 and improved over the years, allows ANBIMA to evaluate the applications for registration of offerings, and after this analysis and an unrestricted opinion, the offerings can be automatically registered with the CVM.

The decision to include FIAGRO-FII and FI-Infra in this agreement was motivated by the expansion of these offerings in recent years and the market’s demand for a more comprehensive analysis of these funds. Through prior evaluation, the time taken for analysis is expected to be reduced while maintaining access to the target audience originally planned for ordinary offerings.

For more information: ANBIMA and CVM include prior analysis of FIAGRO-FII and infrastructure fund offerings in agreements between institutions.

BNDES provides BRL 66.5 billion in the 2024/2025 Safra Plan

The National Bank for Economic and Social Development (“BNDES”) will provide BRL 66.5 billion in the 2024/2025 Safra Plan to finance investments related to agriculture.

The amounts will be made available through the Federal Government’s Agricultural Programs (“PAGFs”), which make up the 2024/2025 Safra Plan, effective from July 1, 2024 to June 30, 2025.

Within the amount made available for 2024/2025, the BNDES will offer BRL 33 billion in its own resources through the BNDES Rural Credit line, which focuses on investment, funding and support for cooperatives.

For more information: BNDES provides BRL 66.5 billion in the 2024/2025 Safra Plan

AGRO IN THE MEDIA

The Latin American Lawyer magazine

REGULATION

TAX REGULATION:

House of Representatives approves tax reform regulations

On July 10, 2024, the House of Representatives concluded the vote on the substitute text to Supplementary Bill (PLP) No. 68/2024, originally presented by the Executive Branch to regulate certain aspects of the Tax Reform.

Among the main changes to the original bill, we briefly highlight the following:

• Animal protein will be subject to a zero rate of Tax on Goods and Services (“IBS”) and Contribution on Goods and Services (“CBS”). This list includes meat, fish, cheese and salt. The use of seawater, pure sodium chloride and other similar agents will also be zero-rated.
• Corn oil, oats, and flour have been included in the zero rate list without specification. Some of them, such as corn flour, remain in the 60% reduction table.
• In addition, plants and floricultural products grown for food, ornamental, or medicinal purposes (bulbs, seedlings, tubers, flowers) in vegetable gardens will receive a 100% reduction in IBS and CBS rates.
• Agrochemicals, agricultural inputs, fertilizers, animal feed, fertilizing material, veterinary vaccines, and other materials used in farming will receive a 60% tax reduction if registered with the Ministry of Agriculture and Livestock. What is new compared to the original text is the specification of tax reductions for inputs, animal and plant genetic improvement products, and biotechnology, including royalties.
• Rural producers will be exempt from the annual turnover limit of BRL 3.6 million for opting to register as a taxpayer for the new taxes.
• Mineral products in general (not just those extracted) will now be included in the list of selective taxes (“IS”).

Among other significant changes in the agricultural sector, we also highlight:

• Reduction of the original deadline for reimbursement of credits: 30 days for taxpayers included in compliance programs and 180 days in other cases, compared to the 270 days originally established.
• IBS and CBS credits: credits for purchasing goods or services at reduced rates will be kept in full, without the need for a partial or full refund. In addition, when the split payment or payment by the purchaser has not been implemented, the credits can be used by highlighting them on the purchase tax document.
• FII and FIAGRO: may register as optional IBS and CBS taxpayers.

The text has been referred to the Senate, which will vote on it in a single round, and, finally, it will be submitted for presidential approval or veto. If the Senate proposes any changes, the bill will return to the House for subsequent approval by the Executive Branch.

STF to decide on the constitutionality of the purchaser’s subrogation to FUNRURAL

The subject is discussed in the Direct Action for the Declaration of Unconstitutionality “(ADI”) 4395, which, in addition to the constitutionality of the Rural Workers’ Assistance Fund (“FUNRURAL”) for individual rural employers, after Law No. 10,256/01, also addresses the subsistence of the subrogation of the purchaser of rural production, provided for in article 30, IV, of Law No. 8,212/91.

On December 21, 2022, the Brazilian Federal Supreme Court (“STF”) reaffirmed the constitutionality of FUNRURAL for individual rural employers but adjourned the trial to announce the decision in an in-person session scheduled for August 28, 2024, when the justices will decide on the validity of subrogation given the absence of a new law on the subject.

During the trial on the subject, initiated in a virtual plenary session, six votes were already cast in favor of the subrogation not being admissible. However, since it was brought to a plenary session in person, the votes will start to be counted again, and the justices may change their previous votes.

Taxpayers expect subrogation to be declared unconstitutional in the terms of Laws No. 8,540/92 and 9,528/97.

RFB publishes guidelines for DITR 2024

Through RFB Normative Instruction No. 2,206/2024, the Brazilian Federal Revenue Service (“RFB”) published the guidelines for completing and submitting the Rural Property Tax Return (“DITR”) for the 2024 financial year. The submission deadline begins on August 12 and ends on September 30, 2024. Taxpayers subject to the DITR must be aware of the applicable rules to avoid any penalties arising from non-compliance.

FINANCIAL REGULATION

Central Bank concludes first public consultation on ESG risk disclosure regulations

The Central Bank of Brazil has concluded the first public consultation on updating the regulations governing the disclosure of information on environmental, social and climate (ESG) risks by financial institutions.

This phase involved the participation of Brazilian and international associations, which contributed with suggestions on methodologies and risk management. The aim is to define the quantitative information that should be published, such as risk exposures by sector, targets and indicators used, which will be included in the Social, Environmental and Climate Risks and Opportunities Report (“GRSAC Report”).

The GRSAC Report currently establishes the disclosure of qualitative information on risk management and governance structure, but the new regulation seeks to broaden this scope to include more detailed quantitative data.

The public consultation was carried out by taking contributions, and the Central Bank of Brazil presented open questions to the market. A third phase is planned for the second half of 2024, which will include a new public consultation, now on the regulatory proposal: this last phase is expected to end in 2025.

For more information: Central Bank concludes first public consultation for regulating ESG risk information.

LCI and LCA: maturity of credit bills to 90 days is debated

Bill No. 952, of March 25, 2024 (“PL 952/24”), currently under analysis by the House of Representatives, proposes reducing the minimum maturity of Agribusiness Credit Bills (“LCA”) and Real Estate Credit Bills (“LCI”) to 90 days.

Investors currently have to wait between 9 and 12 months to redeem these investments, depending on the product, and up to 36 months for instruments linked to price indexes such as the National Broad Consumer Price Index (“IPCA”). The bill aims to enable more attractive and accessible products, facilitating the raising of funds to finance the agricultural and real estate sectors.

Before moving on to the Senate, the bill will be analyzed by the Finance and Taxation Committee and the Constitution and Justice and Citizenship Committee. If approved, the new regulation could benefit investors looking for investment alternatives with shorter grace periods and greater flexibility and liquidity.

In February 2024, a decision by the National Monetary Council had already established new regulations for issuing LCIs and LCAs, increasing the minimum maturity periods from 90 days to 9 months for LCAs and 12 months for LCIs, seeking to avoid excesses in the market for private funding exempt from income tax. The change proposed by Bill 952/24 is designed to partially reverse this decision, allowing investors to access products with shorter grace periods without compromising the security and appeal of investments.

For more information: LCI and LCA: maturity of credit bills to 90 days is debated.

ENVIRONMENTAL REGULATION

Forestry Aspects

IBAMA establishes procedures related to the Degraded Area Recovery Project

On July 03, 2024, the Brazilian Institute for the Environment and Renewable Natural Resources (“IBAMA”) published Normative Instruction No. 14/2024, which establishes procedures for the preparation, presentation, execution and monitoring of the Degraded Area or Altered Area Recovery Project (“PRAD”).

According to the Instruction, the PRAD must be drawn up in accordance with one of the Terms of Reference to be indicated by IBAMA, and the PRAD may be “complete” or “simplified”.

In order to define the Terms of Reference to be adopted, as well as the type of PRAD, criteria will be adopted based on the size of the area to be recovered and the classification of the environmental scenario:

(i) Environmental Scenario A: areas with high potential for natural regeneration, where there is abundant regenerating vegetation or close to areas with remaining native vegetation with high diversity and density, loosely compacted soils and low presence and competition from invasive species, tending to require little management and incremental interventions to conduct natural regeneration.

(ii) Environmental Scenario B: areas with medium potential for natural regeneration, where there is some presence of regenerating vegetation, close to areas with remaining native vegetation, slightly compacted soils, possible presence of invasive species, which may require management by planting seedlings, direct sowing of native species, enrichment with target species, or other techniques.

(iii) Environmental Scenario C: areas with low potential for natural regeneration, where there is no presence of regenerants or areas with remaining native vegetation, with the possibility of degraded soil and/or the dominance of invasive species, which may require, in addition to techniques from environmental scenario B, planting in a total area, individually or jointly, and the use of correction techniques, soil conservation, surface drainage, among others.

Once the PRAD has been assessed and approved by IBAMA, the project operator will be called upon to sign a Term of Commitment with such environmental agency to start implementing the measures planned for environmental recovery and its monitoring by the environmental agency.

For more information: Normative Instruction No. 14/2024

Federal government establishes the National Program for Productive Forests

On July 04, 2024, the Federal Government published Federal Decree No. 12,087/2024, which establishes the National Productive Forests Program, aiming to recover areas that have been altered or degraded for productive purposes, with a view to adapting and regularizing the environment for family farming and expanding the capacity to produce healthy food and socio-biodiversity products.

The Program will be implemented in all biomes and will target family farmers and rural project operators, through actions such as: (i) technical assistance and rural extension; (ii) credit and financing for the development of agroforestry systems; and (iii) structuring seed houses and networks, community nurseries and other instruments that offer inputs for the chain of recovery of degraded and altered areas, including genetic material.

In order to establish the composition, powers and operation of the Program, a management collegiate body will be set up by means of a joint act of the Ministry of Agrarian Development and Family Farming and the Ministry of the Environment and Climate Change.

For more information: Federal Decree No. 12,087/2024

São Paulo establishes procedures for the stages of the environmental regularization process through SICAR-SP

On July 03, 2024, the São Paulo State Department of Agriculture and Supply (“SAA”) published Resolution No. 50/2024, which establishes the procedures to be observed in the different stages of the environmental regularization process for properties in the State of São Paulo, using customized modules of the São Paulo State Rural Environmental Registration System (“SICAR-SP”).

According to the Resolution, the procedure for environmental regularization of rural properties with irregular suppressions in Permanent Preservation Areas and Legal Reserves before July 22, 2008 will follow the following stages:

1. registration of the Rural Environmental Registry (“CAR”) by the owner and/or possessor of the rural property;
2. validation of the CAR by the Secretariat;
3.  environmental regularization:
   1. adhesion to the Environmental Regularization Program (“PRA”), by the owner and/or possessor of the rural property;
   2. submission, by the owner and/or possessor of the rural property, of the Project for the Recompositing of Degraded and Altered Areas (“PRADA”);
   3.  signing of the Term of Commitment (“TCA”)for Environmental Adequacy by the producer and/or possessor of the rural property and by the Secretariat; and
4.  implementation and monitoring of the PRADA committed to in the TCA.

The SAA’s Coordination Office for Comprehensive Technical Assistance will be responsible for monitoring the measures agreed in the TCA.

For more information: Resolution No. 50/2024

São Paulo sets out procedures for Legal Reserve compensation

On July 17, 2024, SAA Resolution No. 55/2024 was published by the São Paulo State Department of Agriculture and Supply (“SAA”), which sets out the procedures for analyzing applications for Legal Reserve compensation.

The rule stipulates that, for rural properties with Legal Reserve liabilities, located in the Tension Zone, the compensation of the Legal Reserve of one property in the area of another will be accepted, provided that: (i) the area where the Legal Reserve is to be compensated has been acquired by March 29, 2022; and (ii) the contract between the parties for compensation of the Legal Reserve has been registered with the notary until March 29, 2022.

Legal Reserve compensation in an area of equivalent size must meet the following requirements: (i) in areas located in the Atlantic Forest Biome, the Legal Reserve must be located in the Atlantic Forest Biome or in a Tension Zone; (ii) in areas located in the Cerrado Biome, compensation in the same biome must have been carried out by March 29, 2022; (iii) in areas located in a Tension Zone, compensation in an area of the Atlantic Forest Biome or in the Tension Zone must have been carried out by March 29, 2022.

For more information: SAA Resolution No. 55/2024

Roraima establishes procedures for forest replenishment and generation of forest credits

On June 18, 2024, the Roraima State Foundation for the Environment and Water Resources (“FEMARH”) published Normative Instruction No. 03/2024, which sets out the procedures for forest replenishment and the consumption of forestry raw materials.

According to the normative instruction, individuals and legal entities that: (i) use forest raw material from the suppression of native vegetation; (ii) hold authorization to suppress native vegetation; and (iii) exploit native vegetation without authorization are obliged to replenish the forest.

In addition, forest replacement credits may be generated for forest plantations previously licensed by FEMARH, which are the right to a credit by planting a forest.

These credits can be used, for example, to recover degraded Permanent Preservation Areas and Legal Reserves.

For more information: Normative Instruction No. 03/2024

Mato Grosso do Sul suspends environmental authorizations for controlled burning

On November 06, 2024, the Environmental Institute of Mato Grosso do Sul (“IMASUL”) published Ordinance No. 1426/2024, which suspends for a period of 180 days the effects of all Environmental Authorizations for controlled burning, including those for the prophylaxis of post-harvest sugarcane straw, prophylaxis in planted forests and the burning of crop remains, as well as sapping linked to duly authorized suppression projects.

For more information: Ordinance No. 1426/2024

Tocantins establishes procedures for the CAR and for adhering the PRA

On July 10, 2024, the Secretariat for the Environment and Water Resources and the Tocantins Nature Institute (“NATURATINS”) published Normative Instruction No. 01/2024, which establishes the procedures for registering and analyzing the Rural Environmental Registry (“CAR”) through the CAR Management Information System (“SIGCAR”) in a declaratory manner, as well as for signing the Terms of Commitment of the Environmental Regularization Program (“PRA”).

Registration in the state CAR is mandatory for rural properties and must be done by the owner, possessor or legal representative, with the presentation of supporting documents (e.g. georeferencing). The information declared will be analyzed and validated by the environmental agency.

In the case of identification of areas to be restored (Legal Reserve – RL or Permanent Preservation Area – APP), a PRA Term of Commitment will be signed between the project operator and the environmental agency, the purpose of which is to establish the conditions and obligations aimed at adapting the rural property to the environmental requirements established by the legislation in force, in line with the Degraded and Altered Area Recovery Project (“PRAD”). The Term of Commitment signed within the scope of the PRA will be effective as an extrajudicial enforcement instrument.

For more information: Normative Instruction No. 01/2024

Paraná establishes modalities and proportions for compensating degraded vegetation

On July 19, 2024, the Paraná Sustainable Development Secretariat (“SUDEST”) published Joint Resolution No. 10/2024, which aims to define the modalities that may be adopted for vegetation compensation, as well as the proportions for vegetation compensation, by modality, considering as factors the characteristics of the native vegetation to be suppressed, its phytophysiognomy and its stage of ecological succession.

The Resolution states that environmental compensation for native vegetation can be carried out in three different ways: (i) restoration of a degraded area; (ii) conservation of an area with vegetation that has similar ecological characteristics to the vegetation being suppressed; (iii) donation of an area pending land-title regularization, within a State Conservation Unit in the public domain.

With regard to the calculation for compensation, the vegetation compensation area will be that obtained by multiplying the suppression area by the numerical factor assigned to each type of compensation. According to the Resolution, the numerical factor varies according to the modality adopted and the characteristics of the vegetation to be compensated, varying according to the phytophysiognomy and its stage of successional development.

For more information: Resolution No. 10/2024

Santa Catarina establishes procedures for Legal Reserve compensation

On July 16, 2024, the Environmental Institute of the State of Santa Catarina (“IMA”) published Normative Instruction No. 84/2024, which establishes the procedures for compensating Legal Reserves in case of properties that, until July 22, 2008, had remnants of native vegetation below the minimum percentages stipulated by law.

According to the Instruction, the area to be used for compensation must: (i) be equivalent in size to the area of the Legal Reserve to be compensated; (ii) be located in the same biome as the Legal Reserve area to be compensated; and (iii) be located in the state of Santa Catarina.

Furthermore, in the case of a Private Natural Heritage Reserve (“RPPN”) established on a rural property, 100% of this area may be used for the purpose of offsetting the required Legal Reserve area.

For more information: Normative Instruction No. 84/2024

Environmental Inspection

SEMAD inspects properties in the Jequitinhonha region due to deforestation

Between July 01 and 07, the Minas Gerais State Secretariat for the Environment and Sustainable Development (“SEMAD”) carried out inspections to curb alleged illegal deforestation identified by alert systems in the Jequitinhonha region, specifically in the municipalities of Senador Modestino Gonçalves, Itamarandiba, Carbonita, Capelinha, Turmalina and Minas Novas.

The agency says that in some of the areas inspected, no new deforestation was found. However, in most of the areas inspected, non-compliance with areas already embargoed by SEMAD was identified.

Approximately 40 properties were inspected.

For more information: SEMAD inspects properties in the Jequitinhonha region due to deforestation

Paraná intensifies inspection of deforested areas in the central region

Between June 23 and 30, the Paraná Water and Land Institute (“IAT”), during an operation carried out by the environmental agency, identified a total of 489.7 ha of areas cleared without authorization, concentrated mainly in the Prudentópolis region.

The IAT operation should have resulted in the issuing of 237 Environmental Infraction Notices and the imposition of BRL 6,980,000.00 in fines.

For more information: Paraná intensifies inspection of deforested areas in the central region

Environmental Licensing

ICMBio publishes guidelines on vegetation suppression for activities inside federal Conservation Units

On July 15, 2024, the Chico Mendes Institute for Biodiversity Conservation (“ICMBio”) published Normative Instruction No. 06/2024, which establishes the procedures for issuing Authorization for Vegetation Suppression in activities subject to environmental licensing and for issuing Authorization for Vegetation Suppression in activities not subject to environmental licensing, inside federal Conservation Units. The deadline for issuing these documents is up to 60 days.

According to the Instruction, the procedures for suppressing vegetation must comply with the following conditions, in short: (i) vegetation suppression must use a methodology that minimizes the waste of wood and the impact on fauna; (ii) non-commercial wood and firewood resulting from tree branches may be used as containment in erosion processes, as organic matter in the recovery of degraded areas or for energy production; (iii) the logs and firewood resulting from the suppression of vegetation may not be burnt or buried inside the Conservation Unit; and (iii) the time elapsed between the scaring away of fauna and the suppression of vegetation must not exceed 2 days.

For more information: Normative Instruction No. 06/2024

Federal Legislation

Federal government establishes Integrated Border Program

On July 10, 2024, the Federal Government published Ordinance No. 2,413/2024, which establishes the Integrated Border Program (“PFI”) as a strategy for implementing the National Regional Development Policy within the Ministry of Integration and Regional Development (“MIDR”).

The general objective of the Program is to encourage economic, social and productive development in the border area, through cooperation between neighboring countries, with a view to creating opportunities that result in attracting investment, economic growth, innovation, reducing asymmetries and inequalities, and generating work and income through sustainable regional development plans, programs and projects that benefit the populations located in border regions.

Specific objectives include: (i) supporting land-use planning and management measures and sustainable development on the border strip; (ii) promoting productive conservation and environmental regeneration actions to mitigate climate change; and (iii) promoting investment projects that are attractive to the private sector, including advanced certification and traceability services, specialized laboratories, processing units, logistics and marketing hubs, considering the public counterpart of sustainable infrastructure for transporting production, cross-border integration, training and professional qualification, qualified financing, tax incentives and regulation.

For more information: Ordinance No. 2,413/2024.

New federal legislation allows use of CAR to calculate ITR

On July 24, 2024, the Federal Government published Law No. 14,932/2024, which replaces the presentation of the Environmental Declaratory Act (“ADA”) by the Rural Environmental Registry (“CAR”), for the purposes of calculating the taxable area of rural property in the Rural Land Tax (“ITR”).

Among the areas that are excluded from the ITR calculation are: (i) permanent preservation and legal reserve areas; (ii) areas covered by native, primary or secondary forests at a medium or advanced stage of regeneration; (iii) areas under environmental easements; and (iv) areas proven to be unsuitable for any agricultural, livestock, farming, aquaculture or forestry exploitation, declared to be of ecological interest by an act of the competent federal or state agency.

For more information: Law No. 14,932/202

TCFA debts related to forestry activities are canceled

The Federal Law No. 14,876/2024 was published, which excluded forestry from the list of potentially polluting activities and users of environmental resources provided for in the National Environmental Policy (Federal Law No. 6,938/1981).

As a result of this change, forestry will no longer be liable to pay the Environmental Control and Inspection Fee (“TCFA”).

According to the Collection and Collection Coordination of the Brazilian Institute for the Environment and Renewable Natural Resources (“IBAMA”), TCFA debts, as of the 2nd quarter of 2024, whose triggering event is the development of forestry activity (forests planted with native species – code 20.60 or forests planted with exotic species – code 20.61), will be canceled.

In case the entrepreneur has already paid the TCFA in advance for the 2nd, 3rd and 4th quarters, the refund of the amounts paid must be requested via an application in IBAMA’s SEI system.

For more information: TCFA debts related to forestry activities are canceled

REGULATION – MINISTRY OF AGRICULTURE AND LIVESTOCK (“MAPA”)

Ordinance establishes procedures for administrative installment payment of debts

On July 19, 2024, MAPA Ordinance No. 695 entered into force, establishing the procedures for the administrative installment payment of debts with MAPA.

The measure aims to use all existing administrative channels to obtain reimbursement from the public treasury before legal collection or a Special Rendering of Accounts is initiated. The installment payment agreement, in turn, will be formalized through an Administrative Installment Payment Agreement, which will be issued by MAPA itself.

Under the new regulation, debtors will benefit from greater financial flexibility. They will be allowed to pay their debts in up to 60 installments, with minimum installments of one minimum wage, thus facilitating debt settlement. The request for an installment payment must be submitted through a specific application, according to the template in Annex I of the Ordinance.

Ordinance extends deadline for regularizing inedible animal by-products

On July 15, 2024, SDA/MAPA Ordinance No. 1,143 was published, which extends the deadline established in Ordinance SDA/MAPA No. 871/2023.

SDA/MAPA Ordinance No. 871/2023 established new transit and health certification procedures for inedible animal by-products for industrial or technical use. The new measure extends the deadline for compliance with the requirements established by Ordinance No. 871/2023 until September 2025.

Deadline opened to receive proposals for contracting FUNCAFÉ funds

On July 12, 2024, SPA/MAPA Ordinance No. 88 was published, opening the deadline to receive proposals for contracting funds from the Coffee Economy Defense Fund (“FUNCAFÉ”) for the 2024/25 crop year.

The regulation allows financial institutions that operate FUNCAFÉ funds to submit their proposals and documentation for the 24/25 crop year within eight calendar days of the date of publication.

The measure seeks to ensure that funding reaches the largest number of beneficiaries in the coffee sector, strengthening its sustainability and growth. Contract proposals and qualification documents must be submitted to the Secretariat for Agricultural Policy, exclusively via the e-mail address “funcafe-contratos@agro.gov.br”.

New regulation establishes guidelines for rework, revalidation and reprocessing of chemical products

On June 27, 2024, SDA/MAPA Ordinance No. 1,136 was published, establishing new guidelines for the procedures for reworking, revalidating and reprocessing formulated products, technical products and premixes of a chemical nature, provided for by Law No. 14,785/2023.

The measures seek to ensure the traceability, safety, and guarantees for these products in the agricultural sector while fostering sustainable practices. In addition, the measure is in line with the UN Sustainable Development Goals, contributing to climate change mitigation and promoting a more sustainable environment.

Ordinance extends reference specifications for pest control

On June 24, 2024, Ordinance No. 1,127 was published, increasing the number of reference standards (RS) for phytosanitary products approved for use in organic farming to 60, and amended Joint SDA/SDC Normative Instruction No. 2 of July 12, 2013.

The new RS are widely accessible and should make registering products based on biological control agents easier.

The updates include new biological agents for pest control, providing more sustainable phytosanitary management options. The measure seeks to expand and diversify the tools available to farmers for sustainable agricultural management.

Ordinance establishes procedures for controlling animal multiplication material

On July 23, 2024,SDA/MAPA Ordinance No. 1.152 was published, establishing procedures for registration, control, and inspection of commercial establishments that sell local and imported animal multiplication material.

The main amendment establishes that any commercial establishment producing animal multiplication material must be registered with the MAPA. The measure seeks to strengthen the chain of production and trade of genetic material in Brazil, ensuring the health of animals and the efficiency of production processes.

Decree establishing the National Policy for Conservation and Sustainable Use of Genetic Resources published

On July 04, 2024, Decree No. 12,097/2024 was published, establishing the National Policy for Conservation and Sustainable Use of Genetic Resources for Food, Agriculture and Livestock.

The regulation seeks to foster conservation, sustainability, protection, and enhancement of genetic resources, food security, and the expansion of the genetic base of breeding programs carried out by research institutions. The regulation will be implemented in cooperation with the states, the Federal District, municipalities, civil society and private entities.

Minister Fávaro discusses proposals to reduce bureaucracy in exports

On July 16, 2024, Minister Carlos Fávaro met with Frank Rogieri, president in office of the Federation of Industries of the State of Mato Grosso (“FIEMT”), to discuss ways to expedite exports of wood and grain through the Port of Paranagua.

In compliance with the International Plant Protection Convention of the Food and Agriculture Organization (FAO), Brazil has adopted the ISPM-15 standard, which requires treating and marking wood used in cargo transport. The minister seeks to reduce bureaucracy in port procedures without compromising inspection standards.

This interaction with various sectors seeks to identify processes that can be optimized and expand the space for Brazilian agricultural products in international markets. After the meeting, which was attended by Graciane Castro, director of Technical Services at the Department of Agriculture, representatives from the Brazilian Health Regulatory Agency (“ANVISA”) and the Brazilian Institute of the Environment and Renewable Natural Resources (“IBAMA”) will hold further discussions.

Measure makes rural insurance more accessible to coffee growers compared to the adoption of sustainable practices

On July 16, 2024, Minister Carlos Fávaro, the National Coffee Council (“CNC”) and Pró Natura Internacional signed a Technical Cooperation Agreement for the project “Sustainable Brazilian Coffee Growing – Carbon Credit Compensation System in Rural Insurance Policies in Brazil”.

The project aims to reduce the cost of rural insurance policies through financial compensation for the sale of carbon credits, offering additional protection against agricultural risks to producers who adopt sustainable practices.

In addition, the agreement aims to reduce producers’ costs in pre-costing the harvest and continuously assess performance regarding carbon footprint. The measure also aims to encourage good agronomic practices and climate control.

REAL ESTATE REGULATION

New provision by the Mato Grosso Court of Justice represents progress in land regularization in the state

On June 04, 2024, TJMT/CGJ Provision No. 12/24 (“Provision”) was published in the Mato Grosso Electronic Justice Gazette, which provides for the procedures to ratify real estate registrations resulting from disposals and concessions on public lands located on the border strip of the State of Mato Grosso, under the terms of Federal Law No. 13,178/2015.

The Provision has not only changed the wording but also introduced crucial articles to the Code of General Rules of the Extrajudicial Forum Administrative Department of Justice (“CNGCE”). These changes have a profound impact on the actions of real estate registry officers, guiding them in ratification procedures in Mato Grosso.

With these changes, the CNGCE now clearly sets out the entire procedure for ratifying real estate registrations resulting from disposals and concessions on public lands located on the border strip in the real estate registry offices of the state of Mato Grosso. This ensures greater legal certainty and standardization in these cases and, therefore, represents a step forward for land regularization in Mato Grosso.

Prior to the Provision, the legislation on the subject was scarce and not standardized, which created a lot of uncertainty in the event of the need to ratify real estate registrations resulting from sales and concessions on public land located on the border strip in Mato Grosso.

Special attention should be paid to article 1.365-A, which establishes that properties over 15 fiscal modules must also prove compliance with the social function of the property as a requirement for the ratification of the real estate registry.

Anoreg-MT guidance note enables the constitution of fiduciary sale of real estate through the issuance of rural bills

Provision 172/2024 of the National Council of Justice (“CNJ”) has generated a series of discussions by establishing the obligation of a public deed of fiduciary sale in guarantee of real estate between private individuals, allowing private deeds only for financial entities of the Real Estate Financial System (“SFI”), the Housing Financial System (“SFH”), and real estate consortium administrators.

However, this provision did not expressly address the possibility of setting up a fiduciary sale through rural credit bills, as this is a private instrument with the effects of a public deed.

In this regard, on July 02, 2024, the Association of Notaries and Registrars of the State of Mato Grosso (“Anoreg-MT”) published Guidance Note No. 84, advising real estate registrars in the state of Mato Grosso to proceed with the positive classification of fiduciary sales in guarantee of real estate and related acts entered into by bills, within the scope of rural activity, as an exception to that established by CNJ Provision 172/2024.

Thus, Anoreg-MT, through this Guidance Note, considered the institution of fiduciary sale of real estate as collateral for agricultural operations to be legitimate, through the issuance of rural credit, product or financing bills, based on the agribusiness financing microsystem and its importance.

This is an essential position for the institution of guarantees in transactions involving rural real estate, but it is worth highlighting that this is a state note, which covers only the state of Mato Grosso, as well as a guideline (which notaries may follow or not) and not an obligation. Therefore, it is advisable to proceed with the drawing up of a public deed to guarantee greater legal certainty.

Commission approves proposal that prohibits a time frame for demarcation of indigenous lands

On July 03, 2024, the House of Representatives Committee on the Amazon and Original and Traditional Peoples approved Bill No. 4566/23, prohibiting any administrative, legislative, or judicial measure that sets a time frame for the demarcation of Indigenous lands.

The same committee had already approved this bill; however, due to problems with the deliberation system, the chair annulled the vote, preventing any amendments from being presented.

The topic, which is still the subject of several discussions, should finally be decided, as this bill will be analyzed conclusively by the Constitution and Justice and Citizenship Committee and will then be analyzed by the Senate.