BRAZIL Law and Practice Contributed by: Paulo Honório de Castro Júnior and Bruno Marques Feitosa, William Freire - Advogados Associados
with applicable treaties and international agreements, subject to confidentiality safeguards. Accordingly, Brazil’s framework for administrative co- operation combines MLIs, an expanding treaty net - work and domestic regulatory provisions enabling the practical operation of information exchange mecha - nisms. 7.2 Exchange of Information Clauses in Tax Agreements Brazil actively exchanges tax information through automatic, spontaneous and on-request mechanisms. Automatic exchange takes place primarily under the CRS, through which Brazil exchanges finan - cial account information with participating jurisdic - tions. Brazil also implements the country-by-country reporting framework for large multinational enterprise groups, allowing the automatic exchange of CbCRs with treaty partners. In addition, exchanges may occur under intergovernmental agreements relating to the Foreign Account Tax Compliance Act (FATCA). On-request exchange is carried out pursuant to Bra - zil’s double taxation treaties and the OECD/Council of Europe Multilateral Convention on Mutual Administra - tive Assistance in Tax Matters. The RFB, acting as the competent authority, may both request and provide information relevant to the administration and enforce - ment of tax laws. Spontaneous exchange is likewise permitted under applicable treaties and the Multilateral Convention, allowing Brazil to transmit information to partner juris - dictions where it considers such information may be relevant to their tax administration. 7.3 Other Forms of International Tax Collaboration As a signatory to the OECD/Council of Europe Multilat - eral Convention on Mutual Administrative Assistance in Tax Matters, Brazil may engage in simultaneous tax examinations and other co-ordinated administra - tive actions with partner jurisdictions. Domestic law authorises the Federal Revenue Service ( Receita Fed- eral do Brasil ) to conduct such co-operative proce - dures where provided for in applicable treaties.
Brazil is not currently listed as a participating jurisdic - tion in the OECD’s International Compliance Assur - ance Programme (ICAP). While joint or simultaneous audits are legally possible, their practical use remains limited and case-specific rather than institutionalised. 8. Mutual Agreement Procedures and Arbitration 8.1 Availability and Legal Basis Brazil has an established MAP programme. The legal basis for MAP is primarily found in Brazil’s double taxation treaties, which generally follow Article 25 of the OECD Model Convention. These provisions allow taxpayers to request assistance from the com - petent authority where they consider that actions of one or both contracting states result in taxation not in accordance with the treaty. At the domestic level, MAP procedures are regulated by administrative rules issued by the RFB, which acts as the Brazilian competent authority. The current pro - cedural framework is set out in Normative Instruction RFB No 1,846/2018 (as amended), which governs the submission, admissibility, processing and interaction between MAP and domestic administrative or judicial proceedings. Brazil is also a signatory to the OECD/Council of Europe Multilateral Convention on Mutual Adminis - trative Assistance in Tax Matters, which complements treaty-based co-operation but does not replace the MAP provisions contained in bilateral tax treaties. 8.2 Application Deadlines In Brazil, the deadline to submit a MAP request is determined by the applicable tax treaty. Most of Bra - zil’s double taxation treaties follow Article 25 (1) of the OECD Model Convention and provide that the tax - payer must present the case to the competent author - ity within three years from the first notification of the action resulting in taxation not in accordance with the treaty. The starting point is generally the date on which the taxpayer becomes aware – or should reasonably have become aware – of the contested taxation (for example, the date of a tax assessment notice).
71 CHAMBERS.COM
Powered by FlippingBook