Ministry of Communications announces FUST tax waiver to bring connectivity to schools

On September 04, 2024, the Ministry of Communications published Notice of Request for Proposal (“RFP“) No. 166/2024 to select proposals aimed at providing connectivity to 20,000 public schools across Brazil by 2026.

In return, selected providers will receive a Fund for Universalization of Telecommunications Services (“FUST“) tax waiver.

The chosen providers will be responsible for providing the school’s connection to the Internet (external network) and connectivity within the school environment (internal network), as well as providing maintenance and technical support for 24 months.

Investment and tax waiver

The notice provides for a total investment of up to BRL 1.2 billion over 3 years, with BRL 300 million planned for 2024, BRL 450 million for 2025, and BRL 450 million for 2026.

The selected telecommunications service providers will carry out the project with their own resources and, in return, will be entitled to a reduction in their tax contribution to FUST. In 2024, providers will be able to use up to 40% of their FUST contributions to carry out the project, while in 2025 and 2026, the percentage will be up to 50%.

Conditions for participation

To be eligible, providers must be FUST contributors in accordance with ANATEL’s regulations. In addition, companies banned from bidding or contracting with the federal government, declared ineligible, or sanctioned with the decree of expiration of their concession, permit, or authorization within the last two years cannot participate.

Deadline for submitting proposals

Interested providers must submit their proposals between September 06 and 16, 2024, through the Ministry of Communications’ platform.

Demarest’s Telecommunications, Media and Technology (TMT) team is monitoring the topic and remains available to provide any clarifications that may be necessary.