BRAZIL LAW AND PRACTICE Contributed by: Ricardo Barretto Ferreira da Silva, Ingrid Bandeira Santos, Sylvia Werdmüller von Elgg Roberto and Isabella da Penha Lopes, Azevedo Sette Advogados
The provision of IoT/M2M solutions is not regu - lated in Brazil. However, the connectivity required for the transmission of data between devices is relevant, since telecommunications services are regulated in Brazil – ie, are subject to the provisions of Law No 4,972/1997 (the “General Telecommunications Law”; LGT) and regulations issued by ANATEL. A licence from ANATEL is also required for the provision of such services. As per the LGT, VAS refers to the addition of new supportive utilities – related to the access, storage, presentation, movement or recovery of information – to a telecommunications service, while telecommunications services can be used to transmit and receive symbols, characters, signs, writings, images, sounds or information by wire, radio-electricity or optical means, or by any other kind of electromagnetic process. If an IoT/M2M solution involves connectivity via a third-party telecommunications provider hold - ing the applicable licence, the IoT/M2M provider is deemed to be the user of a telecommunica - tions service supporting the application, and as such is not subject to the telecommunications regulatory rules or to ANATEL’s control. In this case, the ISS tax is due, the rate of which varies according to the municipality. If an IoT/M2M solution is both a VAS (related to the IoT/M2M application) and a telecommuni - cations service (related to device connectivity), the solution provider is subject to telecommuni - cations regulatory rules and ANATEL’s control, and it should hold the relevant authorisation; in this scenario, the state tax on the circulation of goods and services ( Imposto Sobre Circulação de Mercadorias e Prestação de Serviços ; ICMS) is due at a higher rate than the ISS tax.
Connected devices are deemed communica - tions products using the radio-electric spectrum for information propagation and, as such, they should be in compliance with technical require - ments issued by ANATEL and be certified and homologated by the same agency. Prior licensing with ANATEL is also required for radiocommunication transmission station opera - tion; however, Law No 14,108/2020 exempted stations integrating M2M communications sys - tems from such prior licensing, and from the payment of certain fees until December 2025. Although the implementation and development of the IoT in Brazil is based on free competition and circulation of data, there must be compli - ance with information security and personal data protection guidelines, and several laws and reg - ulations may apply, including: • the Federal Constitution, which provides that privacy, private life, honour, the “image of people” and the confidentiality of data are inviolable (except in cases of court orders related to criminal investigations or discover - ies); • Law No 9,296/1996, which provides that the interception of information technology, telematics, telephone communications, etc is a crime; • Law No 12,737/2012, which provides for cybercrimes and classifies the disclosure of proprietary information as a crime; • Law No 12,965/2014 (Brazilian Internet Act), which sets principles and rules for ensuring data privacy and protection in relation to the internet; • Decree No 8,771/2016, which sets secu - rity standards for the custody, storage, and processing of personal data and private
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