Publications
- Category: Environmental
Federal Decree 11,080/22 entered into force on May 24, 2022, amending provisions set forth in Federal Decree 6,514/08, one of the most relevant environmental regulatory instruments currently in force. Among other aspects, the decree establishes administrative sanctions for activities deemed harmful on the environment and the federal administrative process to investigate such violations.
Some changes aimed solely at the standardization of Federal Decree 6,514/08, thus they did not substantially alter its content. This is the case of Article 10, Par. 6, and Article 20, Par. 1, which did not modify obligations set forth therein by Federal Decree 6,686/08, related to imposition of fines and the period sanctions are considered as valid, respectively.
Other amendments, however, significantly altered the Decree’s provisions, especially related to administrative processes for the investigation of environmental violations; the environmental conciliation hearing; and the possibility of converting the fine into services of preservation, improvement and recovery of environmental quality, in addition to some environmental sanctions.
The following table presents amendments introduced by Federal Decree 11,080/22 and its comparison to the original provisions outlined in Federal Decree 6,514/08.
It is possible to observe that Federal Decree 11,080/22 implemented several new provisions that directly impact the progress of administrative processes established to investigate environmental violations in the federal sphere. Therefore, it is expected that federal environmental authorities are going to adapt to these new provisions in the coming months.
| ORIGINAL CONTENT OF FEDERAL DECREE 6,514/08 | AMENDMENTS TO FEDERAL DECREE 6,514/08 IMPLEMENTED BY FEDERAL DECREE 11,080/22 |
§ 1. Administrative infractions of less harm to the environment are considered those in which the maximum fine combined do not exceed the amount of BRL 1,000.00 (thousand reais), or that in the case fine are applied per unit of measure, the applicable fine does not exceed the value referred to. |
§ 1. Administrative infractions of less harm to the environment are considered those in which the consolidated fine not exceed the amount of BRL 1,000.00 (thousand reais) or, in the hypothesis fines are applied per unit of measure, does not exceed the amount referred to. |
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§ 1. After the deadline set forth in the caption of art. 113 expires, fines will be subject to monetary updating until their effective payment, without prejudice to the application of interest on late payment and other charges, as provided by law. § 2. The amount of the consolidated environmental fine shall not exceed the limit provided for in caption, with the provisions of Paragraph 1. |
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§ 1. After the deadline set forth in the caption of art. 113 expires, fines will be subject to monetary updating until their effective payment, without prejudice to the application of interest on late payment and other charges, as provided by law. § 2. The amount of the consolidated environmental fine shall not exceed the limit provided for in caption, with the provisions of Paragraph 1. |
§ 6. At the time of the judgment of the infraction notice, the environmental authority must, in case the infraction notice is valid, confirm or modify the value of the fine perday, decide the period of its application and consolidate the amount due by the wrongdoer for further execution. |
§ 6. At the time of the judgment of the infraction notice, the competent authority must, in case the infraction notice is valid, confirm or modify the amount of the fine perday, decide the period of its application and consolidate the amount due by the wrongdoer, for further execution. |
I – the application of triple fine in the event of the same violation; or II - double fine in case of a separate violation. § 1. The aggravation shall be determined in the procedure for the new violation, which shall be, by copy, the previous infraction notice and the trial that confirmed it. § 2. Before the trial of the new offence, the environmental authority shall verify the existence of a previous infraction notice confirmed at trial for the purpose of applying the aggravation of the new penalty. § 3. After the trial of the new infraction, the penalty will not be aggravated. § 4. Once the infraction notice has been found to be confirmed, the environmental authority shall: I - aggravate the penalty as provided for in caption; II - notify the wrongdoer to file its defense against the aggravation of the penalty within ten days; and III – judge the new infraction considering the aggravation of the penalty. § 5. The provisions of § 3 does not apply for the purpose of increasing the amount of the fine, as provided in the arts. 123 and 129. |
I – the application of triple fine in the event of the same violtation; or II – double fine in the case of a separate violation. § 1. The aggravation shall be determined in the procedure for the new violation, making available a certificate with information on the previous infraction notice and the final decision who confirmed it. § 2. Once there is a final decision regarding a previous infraction notive, the wrongdoer will be notified to file its defense, within 10 days, against the possibility of aggravation of the penalty. § 3. In the case of recidivism, the competent authority shall increase the penalty in the form of paragraphs I and II of the caption. § 4. The aggravation of the penalty for recidivism cannot be applied after the judgment referred to in Art. 124. § 5. The adoption of one of the legal solutions provided for in paragraph "b" of paragraph II of Paragraph 1 of Article 98-A shall not exclude the accounting of the violation committed for the purposes of application of the provisions of this article. |
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Sole Paragraph. The allocation of surplus amounts to the percentage established in the caption to funds administered by other federal entities will depend on the conclusion of a specific instrument between the collecting body and the fund manager, under the provisions of Article 73 of Law No. 9,605 of 1998. |
I – suspension of registration, license or authorization; II - cancellation of registration, license or authorization; Iii – loss or restriction of tax incentives and benefits; Iv – loss or suspension of participation in financing lines in official credit institutions; and V – prohibition of contracting with the public administration. § 1 The environmental authority shall fix the period of validity of the penalties provided for in this Article, observing the following deadlines: I – up to three years for the penalty provided for in item V; II – up to one year for other sanctions. |
I – suspension of registration, license or authorization; II - cancellation of registration, license or authorization; Iii – loss or restriction of tax incentives and benefits; Iv – loss or suspension of participation in financing lines in official credit institutions; and V – prohibition of contracting with the public administration. § 1 The authority shall fix the period of validity of the penalties provided for in caption, observing the following deadlines: I – up to three years for the penalty provided for in item V; II – up to one year for other sanctions. |
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Fine of BRL 500.00 (five hundred reais) per kilogram or unit. |
Fine of BRL 1,500.00 (one thousand and five hundred reais) to BRL 1,000,000.00 (one million reais). |
Fine of BRL 1,500.00 (one thousand and five hundred reais) to BRL 1,000,000.00 (one million reais). Single paragraph. If violation of provisions set forth in the caption involves movement or generation of credit in an official system for controlling products of forestry origin, the fine will be increased BRL 300.00 (three hundred reais) per unit, kilo, coal meter or cubic meter. |
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§ 1. The uptake of the caption will be admitted only in the event of a consolidated environmental fine. § 2. In the event of adhering to the conversion of the fine into environmental services, the discount will be in accordance with the stage at which the process is found at the time of the application, in accordance with the provisions of § 2 of art. 143. § 3. The payment of the consolidated environmental fine will be interpreted as adhering to the legal solution and will imply the immediate closure of the administrative process, in accordance with conditions laid down in the regulation enacted by the environmental entity responsible for investigating the environmental violation. |
§ 4. Notification shall be replaced by an electronic subpoena, when the wrongdoers agree with this procedure and available technology confirms its receipt. |
§ 4. Notiifcations will be replaced by an electronic subpoena, in accordance with the provisions of the specific legislation. § 5. The notification must indicate that, within twenty days, the wrongdoer may: I –present a defense, in accordance with the provisions of Articles 97-A and Art. 113; II - request an environmental conciliation hearing in accordance with article 97-A; or III – immediately adhere to one of the legal solutions provided for in point "b" of paragraph II of Paragraph 1 of Article 98-A, in the form of articles 97-A and art. 97-B. |
§ 1. The deadline referred to in Article 113 is suspended by the scheduling of the environmental conciliation hearing and its course will begin from the date the hearing is held. § 2. The overlap of Paragraph 1 shall be without prejudice to the effectiveness of any administrative measures. |
I – request an environmental conciliation hearing; II - request immediate adherence to one of the legal solutions provided for in point "b" of paragraph II of Paragraph 1 of Article 98a; or III - present its defense. § 1. The application for participation in an environmental conciliation hearing will interrupt the deadline for offering the defense. § 2. The interruption of the period referred to in Paragraph 1 shall not prejudice the effectiveness of any administrative measures applied. § 3. The following shall be considered as a withdrawal of interest in participating in an environmental conciliation hearing: I – the non-submission of the application for participation in an environmental conciliation hearing; II - the presentation of defense; and III - immediate adherence to one of the legal solutions provided for in paragraph "b" of paragraph II of Paragraph 1 of Art. 98-A. § 4. Prior to the designated environmental conciliation hearing, the wrongdoer may adhere to one of the legal solutions provided for in point "b" of paragraph 1(1) of Article 98-A. § 5. The adherence to one of the legal solutions provided for in paragraph "b" of paragraph II of Article 1 of Article 98-A shall be accepted only after the consolidation of the fine in the context of the preliminary analysis of the environmental assessment. § 6. The process will only be submitted to the Environmental Conciliation Center if, within the deadline established in the Caption, the wrongdoer requires the holding of an environmental conciliation hearing or requests the adherence to one of the possible legal solutions to shelve the process. |
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I - the irrevocable and irrevocable confession of the debt, indicated by the wrongdoer, arising from an environmental fine consolidated on the date of the application; II - the withdrawal of judicial or administrative challenge the environmental action or to proceed with any challenges or administrative appeals and lawsuits that have as their object the infraction notice; and III - the waiver of any claims of law on which administrative actions and legal actions referred to in item II may be substantiated. Single paragraph. In the event of an environmental action challenged in court, the wrongdoer shall submit, at the time of the application Caption, copy of the protocol of the application for termination of the respective case with a resolution of the merits, addressed to the competent court, based on point "c" of item III of the caput of art. 487 of Law No. 13,105 of March 16, 2015 – Code of Civil Procedure. |
Single paragraph. The inspection report shall be drafted by the agent and shall contain: I – the description of the circumstances leading to the finding of the environmental violation and the identification of the authorship; Ii – recording the situation by photographs, videos, maps, terms of declaration or other means of proof; Iii – the criteria used to set the fine above the minimum limit, where appropriate; and Iv – any other information considered relevant. |
Single paragraph. The inspection report shall be drafted by the agent and shall contain: I – the description of the circumstances leading to the finding of the environmental violation and the identification of the authorship; Ii – recording the situation by photographs, videos, maps, terms of declaration or other means of proof; Iii – the criteria used to set the fine above the minimum limit, where appropriate; Iv – the justified indication of the incidence of aggravating or mitigating circumstances, in the light of the criteria established by the environmental entity; and V – other information considered relevant. |
§ 1. The Environmental Conciliation Center is responsible for: I – carry out the preliminary analysis of the violation for: a) validate the infraction notice after the federal general attorney’s statement; b) declare null the infraction notice that presents a defect that could not be adjusted; c) decide on the maintenance of the implementation of the administrative measures related to Article 101 and on the application of the other sanctions related to Article 3; and II - hold the environmental conciliation hearing to: a) explain to the wrongdoer the reasons that led to the issuance of the infraction notice; b) present the possible legal solutions for shelving the process, such as the discount for payment, installment and conversion of the fine into services of preservation, improvement and recovery of the quality of the environment; c) decide on public policy issues; and d) approve the option of the certificate by one of the solutions referred to in point "b". § 2. The members of the Environmental Conciliation Center will be nominated by the Minister of the State for the Environment and the highest official from the public environmental authority. § 3. The work carried out within the Environmental Conciliation Center may not be chaired by an employee who is a member of the agency or the entity of the federal environmental authority responsible for the issuance of the infraction notice. § 4. The Environmental Conciliation Center integrates the structure of the body or entity of the federal environmental authority responsible for the issuance of the infraction notice. |
§ 1. The Environmental Conciliation Center is responsible for: I – carry out the preliminary analysis of the violtation for: a) validate the infraction notice; b) declare null and void the infraction notice that presents a defect that could not be adjusted; c) decide on the maintenance of the implementation of the administrative measures related to Article 101 and on the application of the other sanctions related to Article 3; d) consolidate the value of the environmental fine, in accordance with the provisions of Article 4; and II - hold the environmental conciliation hearing to: a) explain to the wrongdoer the reasons that led to the issuance of the infraction infringement; b) present the possible legal solutions for the shelving of the process, which are: 1. the discount for payment of the fine; 2. the installment of the fine; and 3. the conversion of the fine into preservation services, from improvement and from recovery of the quality of the environment; c) decide on public policy issues; and d) approve the option of the certificate by one of the solutions referred to in point "b". § 2. The members of the Environmental Conciliation Center will be nominated by the highest official from the public environmental authority. § 3. Revoked. § 4. The Environmental Conciliation Center integrates the structure of the body or entity of the federal environmental authority responsible for the issuance of the infraction notice. |
§ 1. The non-attendance of the wrongdoer to the environmental conciliation hearing shall be interpreted as a lack of interest in reconciling and will initiate the deadline for submitting the defense against the infraction notice, pursuant to Art. 113. § 2. The wrongdoer may present justification for his non-attendance to the environmental conciliation hearing, accompanied by the respective evidence, within two days, from the date scheduled for the hearing. § 3. It is the exclusive discretion of the Environmental Conciliation Center to recognize as valid the justification set forth in § 2 and schedule a new date for the environmental conciliation hearing, with the return of the deadline for offering the defense. § 4. There is no appeal against the rejection of the justification of paragraph 2. § 5. As long as the wrongdoer agrees, the environmental conciliation hearing may be held by electronic means, in accordance with the guidelines and criteria established in joint decree issued by the Minister of State for the Environment and the high officials from the federal environmental authority. § 6. Exceptionally, the environmental conciliation hearing may be dispensed or designated a supplementary hearing, in accordance with situations outlined in a joint decree issued by the Minister of State for the Environment and the the high officials from the federal environmental authority. |
§ 1. The non-attendance of the wrongdoer to the designated environmental conciliation hearing shall be deemed as a lack of interest in reconciling and the deadline for submitting the defense against the infraction notice will fully restart, in accordance with article 113. § 2. The wrongdoer may present justification for his non-attendance to the environmental conciliation hearing, accompanied by the respective evidence, within two days, from the date scheduled for the hearing. § 3. It is at the exclusive discretion of the Environmental Conciliation Center to recognize as valid the justification set forth in § 2 and schedule a new date for the environmental conciliation hearing, restarting the deadline for offering the defense. § 4. There is no appeal against the rejection of the justification of paragraph 2. § 5. The environmental conciliation hearing is Held preferably by videoconference, in accordance with the guidelines and criteria established regulation of the federal environmental authority investigating the environmental violation. § 6. Exceptionally at the initiative of the public administration, the environmental conciliation hearing may be dispensed or designated a supplementary hearing, in accordance with situations regulated by the federal environmental authority investigating the environmental violation. |
Single paragraph. The provisions of the Caption also applies to the wrongdoer who has not pleaded for the conversion of the fine on the basis of Decree No. 9,179 of October 23, 2017, the administrative proceedings of which are still pending final judgment on October 8, 2019. |
§ 1. The provisions of the Caption also apply to the infraction notice issued in accordance with the previous legal regime and the fine of which is pending definitive constitution on the date of publication of Decree No. 11,080 of May 24, 2022. § 2. In the case provided for in Paragraph 1, the application for adhering to the legal solution shall comply with the provisions of Article 97-B. |
Single paragraph. The procedure may be annulled from the procedural stage in which the defect was produced, reopening a new deadline for defense. |
Single paragraph. The procedure may be annulled from the procedural stage in which the defect was produced, reopening a new deadline for defense. |
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Single paragraph. The seizure of products, by-products, instruments, parts, and vehicles of any kind provided for in the Caption are independent of its manufacture or exclusive use for the practice of illicit activities. |
§ 1. The seizure of products, by-products, instruments, parts, and vehicles of any kind provided for in the Caoption are independent of its manufacture or exclusive use for the practice of illicit activities. § 2. In the event that the person responsible for the administrative violation or the holder or owner of the property is indeterminate, unknown or of indefinite domicile, the notification of the seizure will be carried out through the publication of its statement in the Official Gazette. |
§ 1. In the event of failure of the environmental conciliation hearing, by failure to attend or by lack of interest in reconciling, the deadline for offering the defense restarts. § 2. The discount of thirty percent provided for in § 2 of Art. 3 and Article 4 of Law No. 8,005 of March 22, 1990 shall be applied whenever the wrongdoer chooses to pay the fine, the installment allowed. |
§ 1. In the event of failure of the environmental conciliation hearing, by failure to attend or by lack of interest in reconciling, the count of the deadline for submitting a defense to which the Caption will restart entirely. § 2. The discount of thirty percent provided for in § 2 of Art. 3 and Article 4 of Law No. 8,005 of March 22, 1990 shall be applied in the event that the wrongdoer opts for payment of the fine in cash. |
Single paragraph. The wrongdoer may request a period of up to ten days for filing its power of attorney |
Single paragraph. The lawyer shall present the power attorney provided for in the Caption, within fifteen days, extendable for the same period by decision of the authority. |
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Single paragraph. The authority shall notify the wrongdoer by post with acknowledgment of receipt or by another valid means that ensures the certainty of its notification, for the purpose of presenting its final submissions. |
Single paragraph. The authority shall notify the autuado, for the purpose of presenting its final submissions: I – by post with acknowledged receipt; II – by electronic notification, in accordance with the provisions of § 4 of Art. 96; or III – by another valid means that ensures the certainty of notification. |
Single paragraph. The authority shall notify the wrongdoer to present its final submissions, by post with acknowledged receipt or by other valid means that ensure the certainty of its notification, in cases where the procedural instruction indicates the aggravation of the penalty related to Art. 11. |
Single paragraph. In the event that the possibility of aggravation of the penalty is identified, after the closure of the procedural investigation, the wrogndoer shall be notified, so that it can present, within ten days, its final submissions, before the judgment, proposed by Art. 124: I – by post with acknowledged receipt; Ii – by electronic notification, in accordance with the provisions of § 4 of Art. 96; or Iii – by other valid means that ensure the certainty of notification. |
§ 1. The appeal will be addressed to the competent authority, which has five days to reconsider its decision or to submit it to its superior. § 2. The competent environmental authority shall indicate, in its own act, the higher authority which shall be responsible for the judgment of the appeal referred to in Caption. |
§ 1. The voluntary appeal will be addressed to the competent authority who delivered the trial at the first instance, which has five days to reconsider its decision or to forward it to the competent authority, who will be responsible for the trial in the second and final administrative instance. § 2. The competent environmental authority shall indicate, in its own act, the higher authority which shall be responsible for the judgment of the appeal referred to in Caption. § 3. The wrongdoer may exercise, within the period referred to in the Caption, the option provided for in Paragraph 2 of Article 148, which will characterize the waiver of the right to appeal. |
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§ 1. The appeal shall be brought by a declaration in the decision itself. § 2. In the case of a fine, the appeal will only be applicable in the hypotheses to be defined by the environmental authority. |
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§ 1. The appeal referred to in this article shall be addressed to the higher authority which issued the decision in the appeal, which, if it does not reconsider it within five days, and after prior examination of admissibility, shall forward it to the President of CONAMA. § 2. The judging authority with CONAMA may not modify the penalty applied to aggravate the applicant's situation. § 3. The appeal brought in the manner provided for in this article shall not have suspensive effect, except for the penalty of fine. § 4. In the event of a fair fear of injury of difficult or uncertain redress, the authority or the immediately superior authority may, in a letter or at the request of the applicant, give suspensive effect to the appeal. § 5. The environmental body or entity shall discipline the requirements and procedures for the processing of the appeal provided for in Caption of this article. |
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Single paragraph. The fines will be subject to monetary updating from the drafting of the infraction notice until its effective payment, without prejudice to the application of interest on late payment and other charges, as provided by law. |
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Single paragraph. The simple fine can be converted into services for the preservation, improvement and recovery of the quality of the environment, except for fines arising from environmental violations that have caused human deaths. |
Single paragraph. The competent authority, pursuant to § 4 of Article 72 of Law No. 9,605 of 1998, may convert the simple fine into services for the preservation, improvement and recovery of the quality of the environment, except for fines arising from environmental violations that have caused human death and other hypotheses provided for in the regulation of the environmental authority responsible for investigating the environmental violation. |
I – recovery: a) degraded areas for biodiversity conservation and conservation and improvement of environmental quality; b) essential ecological processes; c) of native vegetation for protection; and d) aquifer recharge areas. (...) IX – ensuring the survival of species of native flora and wild fauna kept by the federal body or entity issuing the infraction notice; or (...) |
I – recovery: a) degraded areas for biodiversity conservation and conservation and improvement of environmental quality; b) ecological processes and ecosystem services considered as essential; c) of native vegetation; d) aquifer recharge areas; and (e) degraded or deserted soils. (...) IX - guarantee of survival and recovery and rehabilitation actions for species of native flora and wildlife by public institutions or non-profit organizations; or (...) |
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I – to the Environmental Conciliation Center, at the environmental conciliation hearing; (...) |
I – to the Environmental Conciliation Center, by means of an application for adherence to, within the period laid down in Caput 97-A or until the date of the designated environmental conciliation hearing; (...) |
I – implementation of projects for the preservation, improvement and recovery of the quality of the environment, dealing with, at least, one of the items I to X of the Caption of art. 140; or II - by adhesion to a previously selected project, as outlined in Art. 140-A, and items I to X of the Caption of Art. 140 (Writing given by Decree No. 9,760/2019). § 1. The federal environmental public administration will indicate the project or part of the service to be implemented. § 2. For the hypothesis provided in item II of the Caption, the authority must set forth the procedures necessary for their operationalization. § 3. The projects referred to in Paragraph 1 shall be implemented as a matter of priority in the State in which the violation occurred. |
I – by implementation, under the responsibility of the wrongdoer, of preservation service projects, from improvement and from recovery of environmental quality that contemplates, at least one of the objectives of which treats the Caption of art. 140; or Ii – by adhering to a previously selected project paragraph 3 and which includes at least one of the objectives of the Caption of art. 140. § 1. The federal environmental public administration will indicate the project or part of the service to be implemented. § 2. For the modalities laid down in Caption, the authority will set forth the regulation necessary for their operationalization. § 3. The body or environmental entity responsible for investigating the environmental violation may carry out selection processes to choose projects submitted by public or private bodies and entities, aimed at executing the services of art. 140, observing the procedure provided for in the legislation. § 4. The wrongdoer will bear the costs necessary for the effective implementation of the environmental service described in the selected project. § 5. The adoption, in whole or in part, of the approved project will be provided for in a regulation of the body or environmental entity responsible for investigating the environmental violation. |
(...) § 2. The Environmental Conciliation Center, the authority or the higher authority, when deferring the request for conversion, shall apply the discount of: I – sixty percent, when the application is submitted at the environmental conciliation hearing; (...) § 7. The amount resulting from the discount may not be less than the legal minimum amount applicable to the violation. |
(...) § 2. The Environmental Conciliation Center, the authority or the higher authority, when deferring the request for conversion, shall apply the discount of: I – sixty percent, when the application is submitted within the time limit set out in Caption of Art. 97-A or until the environmental conciliation hearing; (...) § 7. In the event that the penalty comminated has minimum and maximum intervals, the amount resulting from the discount shall not be less than the minimum amount applicable to the infringement. |
§ 1. The Environmental Reconciliation Center, the authority or the higher authority shall consider the peculiarities of the specific case, the offender's background and the deterrent effect of the environmental fine, and may, in a motivated decision, whether or not to defer the request for conversion made by the wrongdoer, in accordance with the provisions of Article 141 and the guidelines established in joint decree of the Minister of State for the Environment and the maximum leaders of the organs and entities of the federal environmental public administration. § 2. In the event of acceptance of the application for conversion, the wrongdoer shall be requested to sign the term of commitment related to Article 146: a) by the Environmental Conciliation Center, during the conciliation hearing; or b) by the authority or the higher authority, upon notification. |
§ 1. The Environmental Reconciliation Center or the authority competent will consider the peculiarities of the specific case, the offender's background and the deterrent effect of the environmental fine and, in a motivated decision, may whether or not to defer the request for conversion made by the wrongdoer, in accordance with the provisions of Article 141 and the guidelines established in regulation of the environmental body or entity responsible for investigating the environmental violation. § 2. In the event of acceptance of the application for conversion, the wrogndoer shall be requested to sign the term of commitment related to Article 146: I - by the Environmental Conciliation Center, in the chances of adhering to the solution in the environmental conciliation hearing; or II - by the authority or the higher authority, upon notification. |
§ 1. The term of commitment shall contain the following mandatory clauses: (...) VI - compensation for damage arising from the environmental violation, existing case; e (...) |
§ 1. The term of commitment shall contain the following mandatory clauses: (...) VI - environmental regularization and compensation for damage arising from the environmental violation, according to regulations; e (...) |
I - request the readjustment of the request for conversion of fine for execution as provided for in Art. 142-Aa, guaranteed the discount of sixty percent on the amount of the consolidated fine; or II - give up the request for conversion of fine, guaranteed the faculty to opt for one of the other possible legal solutions to terminate the process, such as the discount for payment and the installment of the fine. Single paragraph. The expiration of the period of which the caput deals without any manifestation of the wrongdoer implies tacit withdrawal of the request for conversion of fine, in which case the federal environmental public administration body issuing the fine should notify you about the continuation of the administrative process. |
§ 1. At the time of the judgment of the infraction notice or appeal, the competent authority shall assess the request for conversion of a fine into a single decision. § 2. After the request mentioned in Caption, the wrongdoer will be requested to confirm, within twenty days, his interest in the conversion of the fine. § 3. The expiration of the period set forth in paragraph 2 without the manifestation of the wrongdoer will imply tacit withdrawal of the request for conversion of fine, in which case the process will follow its regular flow. |
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- Category: Tax
Hiring bonuses, also called sign-on bonuses, or in the sports arena, key money, is an amount that can be paid when hiring new professionals.
The purpose of this payment is to attract highly qualified and already positioned professionals, compensating them for the discomforts and uncertainties that naturally arise when changing companies. It is also a way to compensate them for benefits that they give up when they accept the new employment contract (for example, benefits due in the event of unjustified dismissal, job stability).
The nature of this bonus for social security contribution purposes is still controverted. Historically, the Administrative Board of Tax Appeals (Carf) has found that such amounts are directly related to the provision of services, regardless of whether they are paid only at the time of hiring, and therefore should be subject to social security contributions.
In such precedents,[1] the Carf has expressed the understanding that hiring bonuses represent an advance payment for future provision of services. To reinforce its position, the agency highlighted the existence of provisions that set forth a minimum time in employment, under penalty of return of the amount received, in whole or in part.
On the taxpayers' side, we believe there are arguments to contend that the amounts in question cannot be included in the taxable salary, the calculation basis for such payments, because, in addition to not being paid on a regular basis, they have the nature of compensation.
Article 195, I, "a" of the Federal Constitution,[2] when dealing with social contributions (and social security contributions) levied on payments made to employees, established as the taxable event (and calculation basis) the payment of "payroll and other employment income paid or credited, for any reason, due to services rendered under an employment relationship.”
In summary, based on this accrual rule, the Federal Government is authorized to institute contributions on payroll or labor income paid to employees. As provided for in article 110 of the CTN,[3] it is necessary to identify the scope of the concepts attributed to the terms "payroll" and “employment income", in order to identify the field of action of the Federal Government in requiring social (and social security) contributions.
When searching for the semantic limits of these terms, it is possible to identify that the word "salary" is directly linked to the payment for services rendered through an employment relationship. It seems clear that the word was used to refer to the remuneration of the category of workers made up of employees.
Therefore, in our view, payments that may be subject to social security contributions (according to the constitutional rule of tax accrual) is the one referring to employees' salaries, whose nature is that of consideration for services rendered under an employment arrangement. The concept does not include the sums given to employees that are used for provision of services.
Therefore, we believe social security contributions can only be levied on the remuneration paid habitually and for rendering of services. Neither requirement, it seems to us, would be met in the case of payment of a hiring bonus.
There is no habitualness, since the amount, although it can be paid in installments, is paid only at the time of hiring. Nor do the amounts arise from the provision of services, since they are agreed upon before the employment contract even begins.
Not only does the hiring bonus not meet the requirements to be considered as taxable salary, but it also has a clear nature of compensation, since it aims at compensating the benefits that the professional gave up when changing jobs.
Thus, in our understanding, it is possible to conclude that the amounts paid as hiring bonuses should not be included in the calculation basis of social security contributions simply because such payments, besides being occasional, have a remunerative/compensatory nature, and are not within the scope of social security contributions.
Recently, there have been precedents from Carf for the non-levying of social security contributions on hiring bonuses,[4] in line with the arguments set out above and in favor of taxpayers.
Some of these precedents[5] are formed due to the application of article 19-E of Law 10,522/02, included by Law 13,988/20, and according to which, in the event of a tie vote between the board members representing the taxpayer and the board members representing the Tax Authorities, the result must be favorable to the taxpayer.
This tie-breaking rule in Carf is being challenged, however, in the Federal Supreme Court (STF) in three direct actions of unconstitutionality regarding article 19-E of Law 10,522 (ADIs 6,415, 6,399, and 6,403).
The matter, therefore, is still controverted. However, even if it is not possible to rule out the risk of questioning and assessments by the Brazilian Internal Revenue Service, one cannot fail to consider that taxpayers have good arguments to contend for the non-levying of social security contributions, reinforced by the most recent precedents of the Carf.
[1] Appellate Decisions 9202-005.156, 9202-008.525, 9202-008.600, 9202-010.167, 9202-008.179
[2] Article 195. Social security shall be financed by the whole society, directly and indirectly, according to the law, through funds coming from the budgets of the Federal Government, the States, the Federal District, and the Municipalities, and the following social contributions:
I - employers, companies, and entities equated to them in the form of the law, levied on:
a) payroll and other income from work paid or credited, in any way, to the individual who works for them, even without an employment relationship;
[3] Article 110. The tax law cannot alter the definition, the content, and the reach of institutes, concepts, and forms of private law, used expressly or implicitly by the Federal Constitution, by the Constitutions of the States, or by the Organic Laws of the Federal District or of the Municipalities, to define or limit tax accrual.
[4] Appellate Decisions 9202007.637 and 9202-008.044
[5] Appellate Decisions 9202-009.762 and 9202-009.762
- Category: Litigation
The Brazilian Securities and Exchange Commission (CVM) released on last June 28 its Risk-Based Supervision Report for the fiscal year of 2021. In the document, CVM points out the supervision actions carried out to treat risks and events considered priority by the Risk Management Committee, according to the Biennial Risk-Based Supervision Plan 2021-2022. In addition, the report discloses the expectations of the technical areas for 2022 on the risk levels of each event.
The four risks prioritized in the Biennial Plan 2021-2022 are:
- relevant information not disclosed to the market;
- transactions with related parties;
- marginal market; and
- tests of impairment and asset valuation.
With respect to the first two matters listed above, the following items of the report stand out:
- Relevant information not disclosed to the market: the supervision actions were developed following the provisions of the Biennial Plan 2021-2022, which provides for the clarification request to the management institution in cases in which the technical area responsible for identifying the occurrence of atypical fluctuation in prices, volume or quantity of securities. Considering that this monitoring was constantly carried out by B3 and notices were sent in 100% of the suspected cases, the risk was reassessed and will no longer be considered as a priority in the 2022 financial year.
- Transactions with related parties: the Biennial Plan 2021-2022 focused on the analysis of the adequacy of disclosure to the market and the availability to shareholders of the information required by Brazilian Law and other applicable rules. In cases in which CVM identified the need for additional due diligence, specific investigations were carried out on the issuers. The goal established in the Biennial Plan 2021-2022 was the opening of proceedings to analyze eight companies per year, selected according to criteria of nature and relevance of transactions.
In 2021, the Superintendence of Business Relations (SEP) met the target, having initiated nine lawsuits, out of which eight are still ongoing. B3 also conducted consistency tests on transaction information with related parties disclosed in the Reference Form and other communications as provided for in CVM Instruction No. 480/09 (revoked by Resolution No. 80/2022). Some divergences were identified and B3 interacted with the companies to obtain clarification. The risk should remain in the same category in 2022.
In relation to the Biennial Plan 2021-2022, the report concluded that all risks and respective events remained stable, with no level increase in comparison with the forecast. In addition, according to the report, CVM arranged 100% of the planned actions for the year, demonstrating its commitment to the integrity and development of the capital markets in Brazil.
The matter highlighted above, more related to corporate practice, are recurrent in the analysis of CVM over the years. In relation the disclosure of relevant information to the market, it is known that insider trading has the function of protecting the capital markets and the reliability of the information, considering the obvious asymmetry between the insider (person who acts and knows the company) and the regular investor. In addition, CVM has greatly evolved in the practices and techniques of investigation of this type of illicit.
In relation to transactions with related parties, in addition to the evident interest of the market and investors in being aware of this type of transaction given its potential to divert social interest and create situations of conflict of interest, it is important to highlight the recent change promoted in the Corporations Law by Law 14.195/21, known as the Business Environment Act.
Under the new rule, the resolution on transactions with related parties whose value exceeds 50% of the total assets of the company indicated in the last approved balance sheet shall be submitted to prior approval by the general shareholders’ meeting .
According to Marcelo Barbosa, the president of CVM during the evaluated period, the work carried out by CVM is an important part of the regulator's management system: "Based on a structured process of identification, analysis and risk assessment, CVM defines the priority actions of supervising the conduct of market participants to achieve the desired results in an increasingly dynamic and complex regulatory environment".[1]
[1] For more information on the topic, please visit: CVM publishes Risk-Based Supervision Report 2021
- Category: Litigation
The service of a legal entity at an old address is not valid when the change of address has already been communicated to the Board of Trade, even if the change has not been reported on the company's own website. The decision was recently issued by the Superior Court of Justice (STJ) in the Special Appeal (Recurso Especial) No. 1,976,741/RJ.
In the case, the defendant argued the invalidity of its summons, based on the argument that the service letter had been delivered to its old address, which, although outdated, was still mentioned in the company’s website as the location of its headquarters.
At the time of the service of process, the change of address had already been informed to the Board of Trade by means of the filing the corresponding corporate act. STJ’s decision also mentions that the letter of summons would have been received by a person not related to the defendant and not by a representative of the defendant.
Based on these two reasons, the defendant claimed the nullity of the service of process during the enforcement of judgment phase, since it had been considered in default.
In response, the plaintiff claimed that:
- the service of process had been effected at the address publicly declared by the legal entity;
- the legal entity could not benefit from its behavior of not altering the address in its website, which would be worsened by the defendant having appeared on the lawsuit during the enforcement of judgement phase; and
- there was no evidence that the person who received the service of process would not be an employee of the defendant.
The State Court of Rio de Janeiro understood that the service of process delivered at the at the address informed in the defendant’s website was valid, although old, on the grounds that there would be an obligation of the legal entity to ensure the updating of the information of the website, by providing the correct address to customers and business partners.
By failing to update the address on the website, the legal entity was supposed to bear the burden of this negligence, and not intend to annul an entire process that was already in the phase of enforcing the lower court decision .
The understanding of the Court of Rio de Janeiro, however, was modified by the Superior Court. The judgment delivered by the court highlighted the importance and formalities required by law for the completion of the service of process and the importance of the right to be heard of both parties to exercise the right to a broad and effective defense.
In the case at hand, the service of process was supposed to follow the provisions of the Code of Civil Procedure of 1973 (CPC/73), which determined, among other rules, that the service would be valid if the letter was delivered to the person with general management and representation powers or to an employee responsible for receiving correspondence and mails.
Considering that it is normally difficult for the legal entity to be served by receiving a letter directly by one of its employees or a person with representation powers, case law was accepting the so-called appearance theory.[1]
In summary, according to this understanding, the service of process made in a commercial establishment or at the headquarters of the legal entity would be valid when received by a person who appeared to have powers to do so and/or by a person whose receipt would reasonably indicate that the legal entity would become effectively aware of the claim.
The incidence of the appearance theory, however, requires two essential elements: the delivery of the service of process at the address of the legal entity and the receipt by an employee of the legal entity.
In the case, the Superior Court disregarded the application of the appearance theory, as the service of process was delivered to an old address of the legal entity and no link between the legal entity and the person who received the letter was demonstrated (it could have been a doorman of the commercial building). In this respect, none of the requirements of the appearance theory would have been met: the letter was not delivered to the address of the registered entity and was the letter was not received by an official, as the connection with the legal entity was not demonstrated.
Moreover, the Judgment of the Supreme Court pointed out that, once the change in the address of the legal entity was registered in the Board of Trade, the new address would already be in the public domain and it could have been verified by the plaintiff. This procedure is exactly what should have been done by the plaintiff: according to Article 319, item II, of the Brazilian Civil Procedure Code, the burden of informing the correct address of the defendant to enable its service of process and other procedural communications is the plaintiff.
The decision of the Supreme Court also objected the argument of the Court of Justice of the State of Rio de Janeiro that the legal entity would have an obligation to provide its correct address in its website to "customers and business partners". To this end, it was understood by the Superior Court that the case is not a contractual matter, which would require out-of-court notifications, but a summons in a lawsuit. The Decision also referred to Law 11.419/06, amended by the recent Law 14.195/21, known as the Business Environment Law, which imposed the service of process by electronic means.
Although the new legislation allows the service of process by email – which is mandatory for all legal entities, except for micro companies and small businesses – the law is clear in determining that the legal entity itself shall indicate an e-mail address in a system of "judicial database, according to the regulation of the National Council of Justice (CNJ)".
It is not, therefore, any e-mail address, but that informed by the legal entity for this purpose, with the aim of safeguarding the formalities of the act of service.
Because of the above arguments, STJ concluded that an address indicated in the website cannot be presumed as valid: there is no legislation requiring the legal entity to keep the address updated on its website. The court also pointed out that the address of the legal entity was updated and correct in the Board of Trade.
This decision is relevant because it reinforces the understanding that it is the plaintiff’s responsibility to indicate the defendant's address of service of process as accurately as possible. In the case of service of process of legal entities, the plaintiff shall verify the available databases, such as the Board of Trade and the Federal Revenue Service, to ensure the validity of the service of the legal entity, without which the process would be null and void in full.
[1] For example, AgInt on AREsp n° 476.491/RJ, rel. Min. Marco Buzz, Fourth Class, judged on November 12, 2019.
- Category: Restructuring and insolvency
Since the entry into force of Law 11,101/05 (LRF), which regulates in-court and out-of-court reorganizations and bankruptcies, the scope of its article 49, paragraph 3, has generated intense debate.
The provision excluded from the effects of judicial reorganization creditors with a credit secured by security interest in assets, establishing that "the rights over the property and the contractual conditions shall control."
The rule is part of an effort by the legislator to encourage reduction of the cost of credit in Brazil, but it raises questions. Although some issues have already been overcome by case law, such as the non-subjection of credits guaranteed by security interest in receivables,[1] on which the Superior Court of Appeals (STJ) has established a consensus, other issues continue to be the subject of controversy.
Does the bankruptcy-exempt receivable persist when the assets subject to security interest belong to a third party?
This new issue in the courts involves classification and value of claims with a security interest. The question is whether these claims should be considered, first of all, bankruptcy-exempt claims in relation to the debtors in possession that are not the holders of the assets and, if so, whether they should be entirely bankruptcy-exempt or listed as bankruptcy-exempt up to the limit of the value of the asset pledged as security interest on the date of the judicial reorganization, as is the case with bankruptcy claims with a security interest.
The first point we have already had the opportunity to discuss in an article in this portal. The second issue was recently addressed by the São Paulo State Court of Appeals (TJSP)[2] during review of appeals filed in the context of the judicial reorganization of the Atvos Group, one of the largest sugar and ethanol groups in Brazil.
Two appellate decisions by the 1st Reserved Chamber of Business Law of the TJSP have established that the assets must be appraised, for the purposes of defining the limit of the bankruptcy-exempt extent of the claim guaranteed by security interest, at the time of execution of the security interest.
The debtors argued that the classification of the claim should be based on the value of the security interest at the date of the filing for judicial reorganization, to avoid distortions in the list of creditors.
For the creditors, on the other hand, the claim should be fully classified as non-business claim, since the value of the asset given as guarantee should only be ascertained at the time of its execution. Should there be any remaining balance, it would be qualified later in a delayed registration.
In the judgment, with Appellate Judge Alexandre Lazzarini serving as reporting judge, the creditors' theory was accepted by the panel. It was defined that "only after the execution of the asset that was subject to security interest will any remaining balance be ascertained for later registration in the reorganization as an unsecured claim."
For the adjudicatory chamber, any devaluation of the security interest does not change the nature of the claim. The panel pointed out that the LRF does not make any reservations in this regard. Therefore, even if there is a reduction in the value of the secured asset at a certain point in time, the difference does not automatically become a non-exempt claim.
The court also pointed out that, if the theory of the debtors in possession were accepted, there would be a weakening of the system of security interests, which would create legal uncertainty and increase the risk in the granting of loans, which would reflect on the interest charged by financial institutions and cause losses to all stakeholders.
The debtors' theory would encounter yet another obstacle to its approval. According to the court, it would "completely change the scenario outlined by the parties when they entered into the financing agreement," going against the principle of pacta sunt servanda, which establishes that contracts are binding, and that of good faith, especially since the security interest would have been essential for the granting of the financing and judicial reorganization does not exempt companies in crisis from fulfilling their contractual obligations.
The decision of the TJSP in the in-court reorganization of the Atvos Group seems appropriate to us, since the asset that is subject to security interest, regardless of its value at the time of the in-court reorganization, secures the debt, and the amount obtained in its execution should be fully used in the amortization of the claim.
To find otherwise would mean to authorize the creation of an undue limitation on the security interest originally contracted, which would benefit, without any legal grounds, the debtor/guarantor of the security interest, in addition to opposing the provisions of article 49, paragraph 3, of the LRF.
The TJSP's position is in line with the STJ's understanding that the remaining balance found after the consolidation of the ownership of the asset given as security and its sale must be qualified in the judicial reorganization.[3]
For the national credit market, these decisions are important, because they reinforce the institutes of fiduciary assignment and security interest, which are widely used as guarantees for financing, especially because they reduce the risks for lenders in the event of debtor default.
[1] STJ, Special Appeal 1629470/MS, Second Section, opinion drafted by Justice Maria Isabel Gallotti, decided on November 30, 2021; STJ, Internal Interlocutory Appeal in Conflict of Jurisdiction 145.379/SP, Second Section, opinion drafted by Justice Moura Ribeiro, decided on December 13, 2017.
[2] Interlocutory Appeals 2174315-41.2021.8.26.0000 and 2281729-35.2020.8.26.0000
[3] STJ, Conflict of Jurisdiction 128.194/GO, Second Section, opinion drafted by Justice Raúl ARAÚJO, decided on June 28, 2017.
- Category: Tax
The Federal Supreme Court (STF) began, on May 6 of this year, in a virtual plenary session, the long-awaited judgment of two extraordinary appeals with general repercussion concerning the limits of the temporal effects of res judicata in tax matters.
In Extraordinary Appeal (RE) 949.297 (Topic 881), of the authorship of Justice Edson Fachin, one discusses whether the decision isued by the STF in concentrated and abstract control of constitutionality would be[1] apt to cease the temporal effectiveness of res judicata previously obtained by the taxpayer or the Public Treasury to the contrary.
The specific case refers to the situation of a taxpayer that obtained a final and unappealable court decision in its favor in a separate lawsuit, to stop paying the Social Contribution on Net Profit (CSLL), under the argument that the law that created[2] the tax was formally unconstitutional. Later, however, in the judgment of Direct Unconstitutionality Action (ADI) 15/DF, the STF declared the constitutionality of the law, validating the collection by the National Treasury.
In summary, the Treasury argues that the res judicata obtained by taxpayers in this situation does not prevail for future taxable events, i.e., those occurring after the STF's decision to the contrary in ADI 15/DF.
The Treasury claims that, since this is a relationship of successive treatment (which is renewed at each taxable event of the tax liability), the prevalence of such individual decisions would go against the normative force of the Federal Constitution, as declared by the STF, and the principles of equality and free competition. This is because, due to the binding effect and general effectiveness of the STF's decisions, the other taxpayers who have no res judicata of their own (the majority) would continue to be subject to the tax requirement.
In RE 955.227 (Topic 885), for which the reporting judge was Justice Roberto Barroso, the STF's decisions handed down in extraordinary appeals (diffuse control of constitutionality) are being examined to determine whether they can cause the res judicata on a tax relationship to cease to have effect in the future when the decision is based on the constitutionality or unconstitutionality of the tax.
This concrete case also deals with the CSLL requirement, but exclusively from the perspective of diffuse control of constitutionality. The National Treasury defends suspension of the effects of res judicata for taxable events occurring after "repeated decisions" of the STF that declared the unconstitutionality of the levy and were issued in extraordinary appeals without recognized general repercussion (before the very existence of the system) and before the judgment of ADI 15/DF.
In both appeals, the Justices must also decide whether the temporal efficacy of the res judicata is automatically broken as of the advent of a decision issued by the STF in the scope of control of constitutionality that is contrary to the meaning of the individual judgment,[3] regardless of an action for vacatur.
Although there are STF decisions that uphold the res judicata formed by decisions that go against the prevailing supervening case law of the Court itself, the votes cast in Extraordinary Appeals 949.297 and 955.227 adopt the position that the interruption of the temporal effects of the res judicata is constitutional in successive tax legal relations when the STF decides otherwise in extraordinary appeals with general repercussion or through the concentrated control of constitutionality.
Although the judgment of the appeals was interrupted by a request for review of the record by Justice Alexandre de Moraes on May 12,[4] the Supreme Court is in the process of establishing a theory of significant legal and economic repercussion, whose criteria may reactivate the levying of tax requirements set aside by final and unappealable decisions in countless other tax disputes, in a true "domino effect".
In RE 949.297, Justice Fachin (reporting justice) voted for automatic breaking of the effects of res judicata by the effectiveness of STF decisions in concentrated and abstract control of constitutionality (ADI, ADO, ADC, and ADPF). The filing of an autonomous action for vacatur would therefore be unnecessary.
For the Justice, abstract constitutional decisions of the STF can change the legal status of a continuous tax relationship, but only in relation to future taxable events, occurring as of publication of the minutes of the judgment. In other words, even if the legal and tax relationship between the taxpayer and the State has been stabilized by prior res judicata, the new legal rule established by a STF precedent would be immediately and automatically effective, overriding any final and unappealable decision to the contrary.
The reporting judge made an express proviso as to the:
- impossibility of retroactivity of case law, prohibiting extension of the legal effects emanating from the decision on constitutionality to facts of the past; and
- need to observe the rules of non-retroactivity and anteriority (annual, ninety day enactment period, and ninety day notice period, depending on the tax). The date of publication of the act of judgment of the STF decision must be equivalent to the first day of effectiveness of the new rule. The opinion also indicates that the effects of this understanding should be subject to softening.
The theory proposed by the opinion was as follows:
"The temporal efficacy of substantive res judicata derived from a tax relation of continuous treatment has as a condition subsequent that it is implemented with the publication of the minutes of a subsequent judgment held in an abstract and concentrated control of constitutionality by the Federal Supreme Court, when the commands of the decision are opposed, observing the constitutional rules of non-retroactivity, annual anteriority, and the ninety day effectiveness or ninety day notice requirement, according to the type of tax in question.
Justice Barroso concurred with Justice Fachin's conclusions for automatic termination of the effects of res judicata upon a decision by the STF in a concentrated control of constitutionality. In addition, however, his opinion expressly attributed this same limiting efficacy of res judicata to decisions rendered by the STF in extraordinary appeals with recognized general repercussion (diffuse control of constitutionality), based on the theory of constitutional change of article 52, X, of the Federal Constitution
According to the traditional understanding (based on the literalness of article 52, X), for a decision by the STF rendered in diffuse control of constitutionality (in an incidental manner in the judgment of an extraordinary appeal) to have binding effect and general effects, it is necessary that the Federal Senate issue a resolution to suspend the execution, in whole or in part, of the law declared unconstitutional.
The decisions handed down in concentrated control (ADI, ADO, ADC, and ADPF), in turn, due to article 102, paragraph 2, of the Constitution, are already endowed with such attributes, regardless of the intervention of the Senate.
For Justice Barroso, due to the evolution of the general repercussion system in our legal system, the Senate’s resolution, provided for in article 52, X, of the Constitution, would serve only to publicize the STF's decision, but not to restrict its effects. In other words, both the STF's decisions handed down in concentrated control and those handed down in diffuse control should produce the same legal effects.
Supported by this reasoning, Justice Barroso proposes the establishment of the following theory:
“1. The decisions of the STF in incidental control of constitutionality, prior to the institution of the general repercussion system, do not automatically impact on the res judicata formed, even in successive tax legal relations. 2. On the other hand, the decisions handed down in direct actions or in decisions with general repercussion automatically interrupt the temporal effects of final and unappealable decisions in the aforementioned relations, respecting the principle of non-retroactivity, annual anteriority, and ninety day effectiveness, or ninety day notice, depending on the nature of the tax.”
Justice Gilmar Mendes, despite also finding for automatic break of final and unappealable decisions with regard to future events, due to the STF's decisions handed down both in concentrated and diffuse control with general repercussion, diverged from the reporting judge of this trend, believing that it is unnecessary to observe tax anteriority to reestablish a tax.
The Justice also discusses the case of an action for vacatur provided for in the civil procedural legislation to establish the understanding that it would be possible to propose such a measure, based on the STF’s decision, to also vacate the res judicata in relation to past taxable events.
Before the request for review of the record, Justice Rosa Weber and Dias Toffoli[5] followed Justice Edson Fachin's opinion. With that, the partial result in RE 949.297 is:
- four votes for automatic termination of the effects of res judicata, regardless of an action for vacatur, observing the rules of anteriority/retroactivity, as of the STF decision rendered in ADI, ADC, ADO, and ADPF, for future taxable events (subsequent to the STF’s decision);
- one vote for:
- automatic termination of the effects of the res judicata in relation to future taxable events, regardless of an action for vacatur, without observing the rules of anteriority/retroactivity; and
- for the possibility of an action for vacatur in relation to past taxable events, in order to reverse the res judicata based on the STF's decision in a concentrated control of constitutionality or general repercussion.
In RE 955.227 in turn, Justice Barroso, opening the opinion as reporting judge, replicated the understanding expressed in RE 949.297, focusing on the constitutional change of article 52, X, of the Constitution and the attribution of the same legal effects typical of decisions in ADCs, ADI, ADO, and ADPF to the decisions of extraordinary appeals with general repercussion.
In the end, the Justice rejected the Federal Government's claim in the case, proposing, however, the same theory of general repercussion suggested in Topic 881, already pointing out the need for softening of the effects of the decision, which was fully accompanied by Justices Dias Toffoli and Rosa Weber.
In both judgments, Justice Barroso stated that the criterion to be defined by the STF also applies to successive tax legal relations in which there is a final and unappealable decision favorable to the Public Treasury. The proviso is relevant, for example, for taxpayers who have a final and unappealable decision against them on issues decided against the Treasury, such as the exclusion of the ICMS from the PIS and Cofins tax bases.
In RE 955.227, before Justice Alexandre de Moraes' request for examination of the case record, only Justice Gilmar Mendes' vote was cast, also to the same effect as the vote cast in Topic 881, that is, admitting the filing of an action for vacatur for the purpose of undoing a res judicata contrary to the STF's decision in a concentrated control of constitutionality or general repercussion for taxable events occurring prior to the STF's decision.
With this, there are currently three votes in RE 955.227 for automatic suspension of the temporal effects of the res judicata in relation to future taxable events, regardless of an action for vacatur, observing the rules of anteriority/retroactivity, also in the event of a res judicata contrary to the STF’s decision rendered under the general repercussion system.
As of the closing date of this article, the judgment was not expected to resume. The votes of Justices Alexandre de Moraes, Cármen Lucia, Luiz Fux, Ricardo Lewandowski, Nunes Marques, and André Mendonça are expected.
In addition to the dispute regarding the CSLL, which already has the potential to generate billion-dollar financial impact, the outcome of topics 881 and 885 will affect other highly relevant tax disputes. This is the case of the levy of social security contributions on the constitutional one third vacation bonus, for which many taxpayers obtained a final and unappealable favorable decision, based on the understanding of the Superior Court of Appeals, before the Federal Supreme Court declared the constitutionality of the levy in the judgment of RE 1072485, with general repercussion (Topic 985).
As soon as the judgment of RE 955.227 and RE 949.297 is resumed by the STF, our comments will be updated, with an analysis of the theories established and their impacts.
[1] Under the terms of Law 9,868/1999, the exercise of concentrated and abstract control of constitutionality is the exclusive competence of the STF and must occur within the scope of a Direct Action of Unconstitutionality (ADI), a Direct Action of Unconstitutionality by Omission (ADO), a Declaratory Action of Constitutionality (ADC), and an Argument of Noncompliance with a Fundamental Precept (ADPF).
[2] Law No. 7,689/88.
[3] "Individual judgment" herein is treated as synonymous with a judgment rendered in a proceeding of the nature of subjective (and not strict) liability, which includes claims filed with joinder of plaintiffs and collective claims, filed to defend the right of a category or class.
[4] There is no forecast for its return to the agenda.
[5] This with the proviso that, in the case of constitutionality of the CSLL, the res judicata obtained by the taxpayers lost their effectiveness only after 90 days had elapsed from the date of publication of the minutes of the judgment on the merits of ADI 15/DF, in observance of the principle of anteriority.