BRAZIL Law and Practice Contributed by: Ricardo Barretto Ferreira da Silva and Camila Sabino Del Sasso, Azevedo Sette Advogados
carried out with the sole purpose of concealing the occurrence of taxes. Law No 9,430/1996 is also relevant, because it deals with tax planning mechanisms and com - bats practices such as under-capitalisation and transfer pricing manipulation. There is also the Anti-Corruption Law (Law No 12,846/2013), which holds companies liable for acts harmful to the public administration, includ - ing tax fraud. Decree No 70,235/1972 regulates the tax administrative process, ensuring due process of law in the collection and penalisa - tion of tax irregularities. The above-mentioned laws, taken together, can be considered to form the legal framework for combating tax evasion in the country. 5.8 Tariffs Brazil’s tariff regime is based on the Mercosur Common Nomenclature ( Nomenclatura Comum do Mercosul , orNCM) and the Common Exter - nal Tariff ( Tarifa Externa Comum , or TEC). The system seeks to protect strategic sectors of the national economy, while at the same time allow - ing some flexibility for occasional adjustments. The higher tariffs are mainly levied on industrial - ised products with higher added value (eg, cars, electronics, footwear and textiles) that are gen - erally imported from countries and regions with which Brazil does not have preferential trade agreements, such as China, the USA and the EU. Among the most protected sectors are the auto - motive, textile, and clothing industries, as well as the technology and electronics sector – all with a strong presence of tariff measures and incentives for national production. The agro- industry also receives protection in specific
segments, such as dairy products and wheat. This tariff structure aims to preserve jobs, stimu - late domestic industrialisation, and guarantee a degree of self-sufficiency in strategic areas. However, the Brazilian tariff regime has been gradually pressurised by changes on the inter - national stage – such as global trade tensions (eg, China versus the USA) and their impact on the supply chain, pushing for greater openness or self-sufficiency in certain sectors – and the Mercosur‒EU trade negotiations. In December 2024, the negotiations on the part - nership agreement between Mercosur and the EU were concluded. The announcement allows the text of the agreement to be prepared for sub - sequent signature and ratification when it enters into force. The agreement should strengthen the diversifi - cation of Brazil’s trade partnerships – a strategic asset for the country – as well as promoting the modernisation of Brazil’s industrial park through integration into EU production chains. It is also expected that the agreement will further boost investment flows, which should reinforce the EU’s current position as the holder of almost half of the stock of foreign direct investment in Brazil.
6. Competition Law 6.1 Merger Control Notification
In Brazil, M&A are subject to mandatory notifica - tion to theAdministrative Council for Economic Defense ( Conselho Administrativo de Defesa Econômica , or CADE) when they meet certain criteria set out in Law No 12,529/2011. CADE is an agency linked to the Ministry of Justice and Public Security ( Ministério da Justiça e Segu- rança Pública , or MJSP). The obligation to notify
74
CHAMBERS.COM
Powered by FlippingBook