BRAZIL Law and Practice Contributed by: Débora Yanasse, Bruno Salzano, Luisa Tortolano Barreto and Julia Braga, Tauil & Chequer Advogados in association with Mayer Brown
4.4 Eminent Domain, Condemnation and Expropriation Rights to Construct and Operate Transmission Lines and Associated Facilities Similarly, in relation to power generation facili- ties, if the proponent fails to reach an amicable agreement with landowners over compensation for the construction and operation of power transmission facilities on their land, the pro- ponent may request the issuance of a DUP by ANEEL, in accordance with ANEEL Normative Resolution No 919/2021, which entitles the pro- ponent to easement or expropriation rights over the land. Based on the DUP, the proponent may judicially obtain injunctions against landowners to access the land, and the court will define the fair compensation due to landowners, usually based on market value. 4.5 Monopoly Rights to Provide Transmission Services Power transmission concessionaires have an exclusive right to construct and operate the transmission facilities under the scope of their concession agreements. The construction of new facilities or the expansion of the capacity of existing facilities may be required by the ONS and authorised by ANEEL, subject to an addi- tional parcel of the RAP. A concessionaire has no exclusive right within a specified geographical territory, but there is no competition among concessionaires, as the RAP is not based on the amount of power transmitted by the concessionaires’ transmission facilities, but on the availability of such facilities. 4.6 Transmission Charges and Terms of Service The principal laws governing the provision of transmission services, as well as transmission charges and terms of service, are:
• the Concessions Law; • Law No 9,074/1995; • Law No 9,427/1996; • Law No 9,648/1998; • Law No 10,848/2004; • Law No 14,120/2021; and • the Concession Renewal Law. All of these have been previously discussed throughout this guide. As mentioned in 5.1 Constructing and Oper- ating Electricity Distribution Facilities , power transmission concessions are under a revenue cap regulation. These concessions may be divided into three categories, as follows: • concessions granted prior to 1998 – their RAP is adjusted annually based on the IPCA index (the inflation index observed by the Central Bank of Brazil), they were renewed for an additional 30 years in 2013 and they have a tariff review every five years; • concessions granted from 1999 to Novem- ber 2006 – their RAP is adjusted annually based on the IPCA index or IGP-M index (the general market price index) and is reduced by 50% in the 16th year of their commercial operation, they have a 30-year term and no tariff review; and • concessions granted after November 2006 – their RAP is adjusted annually based on the IPCA index, they have a 30-year term and three limited tariff reviews within five, ten and 15 years of the granting of the concessions, which only takes into account changes in the cost of capital. ANEEL adopts the weighted average cost of capital (WACC) methodology to review the trans- mission tariffs. In 2025, the WACC of transmis-
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