BRAZIL Law and Practice Contributed by: Domicio dos Santos Neto, Frederico Favacho, Henrique Erbolato and Fernando Ferreira, Santos Neto Advogados
concerning native vegetation suppression, water use, pesticides and soil conservation. Pesticides and Environmental Risk The use and regulation of pesticides is also subject to specific federal legislation. Law No 14,785/2023 establishes rules governing the research, production, registration, commercialisation, use, importation, exportation, disposal and inspection of pesticides and related products. Environmental compliance has therefore become rel- evant not only from a regulatory and liability perspec- tive, but also in financing, investment and transac- tional due diligence. The environmental status of a rural property may affect its value, financing capacity, contractual arrangements, and the allocation of envi- ronmental risks among the parties. 4. Legal Concepts and Regulatory Definitions 4.1 Definition and Scope of Agribusiness Agribusiness There is no single statutory definition of “agribusiness” in Brazil. The concept is economic and institutional, and encompasses the activities conducted throughout the agricultural production chain, including the supply of inputs, primary agricultural production, processing, industrialisation, distribution, commercialisation and financing. Brazilian legislation nevertheless defines or refers to specific activities and participants within the agricul- tural value chain for regulatory purposes. For exam- ple, the legislation governing the Rural Product Note (CPR) defines the relevant rural products by reference to agricultural, livestock, planted forestry, fishing and aquaculture activities, as well as certain related activi- ties. Rural Producer The concept of a rural producer in Brazil is not unified and is addressed differently by different legal instru- ments. Normative Instruction RFB No 2,110/2022 adopts a functional approach, encompassing indi- viduals and legal entities engaged in rural activities.
By contrast, the CPR Law (Law No 8,929/1994) and Law No 11,076/2004 adopt more specific approaches to the concept of a rural producer. This lack of uni- formity may create legal uncertainty when determin- ing whether a party qualifies as a rural producer for purposes of financial and structured transactions. CNAE Classification The CNAE (National Classification of Economic Activi- ties) is frequently used as a practical criterion to iden- tify the economic activity conducted by an issuer or other party involved in an agribusiness transaction. However, the CNAE code alone is not sufficient to legally determine whether an entity qualifies as a rural producer. The analysis should also consider other ele- ments, including the entity’s corporate purpose, oper- ational and commercial documentation, and evidence of its actual engagement in rural activities. 4.2 Conflicts Across Regulatory Instruments The absence of a single, uniform concept of “rural producer” may create interpretative differences across the legal and regulatory framework applicable to agri- business finance. Different statutes and regulations may establish eligibility requirements by reference to the nature of the debtor, the underlying activity, the origin of the receivable or the type of transaction involved. This issue may become particularly relevant in struc- tured finance transactions, where the eligibility of a debtor or receivable may determine whether an asset can be used as collateral or as underlying assets for agribusiness securities. The interaction between the CPR framework and the rules governing the Agribusi- ness Credit Rights Certificate ( Certificado de Direito Creditório do Agronegócio – CDCA), Agribusiness Credit Note ( Letra de Crédito do Agronegócio – LCA) and Agribusiness Receivables Certificate ( Certificado de Recebíveis do Agronegócio – CRA) is therefore an important element of legal analysis. In practice, the assessment may require an analysis of the debtor’s actual activities, corporate purpose, con- tractual relationships and supporting documentation, rather than reliance on a single formal classification.
17 AGRICULTURAL LAW 2026
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