BRAZIL Law and Practice Contributed by: Domicio dos Santos Neto, Frederico Favacho, Henrique Erbolato and Fernando Ferreira, Santos Neto Advogados
framework under Resolution CVM No 39. The new rules entered into force on 3 March 2025, with existing FIAGROs required to adapt by 30 September 2025. The current framework provides for a broad range of eligible assets, including: • rural real estate rights; • equity interests in companies forming part of agri- business chains; • financial assets and securities issued by partici- pants in those chains; • agribusiness receivables; • CRAs and other securitisation instruments; and • certain carbon-related assets. The regulatory development of FIAGROs has there- fore strengthened their role as a structured investment vehicle for agricultural assets, while also introducing more detailed requirements concerning investment policies, disclosure, governance and eligible assets. 5.5 Collateral Structures and Guarantee Models Common Forms of Security Agribusiness financing transactions may involve a variety of collateral and guarantee structures, depend- ing on the nature of the underlying asset, the financing instrument and the debtor’s profile. Common struc- tures may include fiduciary security interests, pledges, mortgages, receivables assignments and guarantees provided by the debtor or third parties. Rural Property in Trust The rural property in trust regime ( patrimônio rural em afetação ), introduced by Law No 13,986/2020 and subsequently amended, is particularly relevant to agri- cultural finance. Under this regime, a rural property or a portion thereof may be submitted to a special legal regime and used as collateral for a CPR or for financial operations through a Rural Real Estate Note ( Cédula Imobiliária Rural – CIR). The affected property constitutes a real right and is subject to specific rules concerning its use and enforcement. Fiduciary Security Fiduciary security structures may also be relevant because they can provide creditors with enforce-
ment mechanisms that differ from ordinary judicial execution. The choice of collateral is therefore a criti- cal component of transaction structuring and should take into account the nature of the asset, registration requirements, enforceability and the debtor’s insol- vency or restructuring risk. 6. Legal Advisory and Market Practice 6.1 Role of Legal Advisers in Transaction Structuring Legal advisers play a key role throughout the planning and execution of financing transactions in the agricul- ture sector. Their role may include: • analysing the legal eligibility of the parties and underlying assets; • assessing regulatory requirements; • conducting legal due diligence; • structuring the transaction; • preparing and negotiating the relevant documenta- tion; and • providing legal opinions. In structured transactions, legal advisers may also be involved in identifying potential regulatory or enforce- ability risks and in designing alternative structures or contractual protections to address those risks. This may be particularly relevant where the transaction involves different legal regimes, such as agribusiness, corporate, financial, environmental, real estate and tax regulations. The legal analysis may therefore extend beyond the formal validity of the documents to the interaction between the underlying commercial activity and the regulatory requirements applicable to the financing structure. 6.2 Legal Opinions and Market Acceptance Legal opinions are essential to agriculture sector financing structures, particularly where investors, financial institutions or other transaction participants require independent confirmation of the legal valid- ity and enforceability of the structure. Depending on the transaction, a legal opinion may address matters such as:
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