There are pending changes to the rules governing the mining sector in Brazil.
The revenue from a “royalty” on mining activities (Compensação Financeira pela Exploração de Recursos Minerais—CFEM) is shared by federal, state, and municipal jurisdictions, depending on the mineral resource in the respective territory. Currently, Brazil’s government is seeking to alter the rules governing the mining sector by means of a series of “provisional measures” (Medida Provisória—MP). A provisional measure is an “act” issued by the president, with the authority of law until later approved by Congress. In general, a provisional measure is effective as from its date of publication for a 60-day period, but it may be extended for an additional 60-day period (for a total of 120 days) on a request from Congress.
The recent provisional measures concerning the mining sector are:
The KPMG logo and name are trademarks of KPMG International. KPMG International is a Swiss cooperative that serves as a coordinating entity for a network of independent member firms. KPMG International provides no audit or other client services. Such services are provided solely by member firms in their respective geographic areas. KPMG International and its member firms are legally distinct and separate entities. They are not and nothing contained herein shall be construed to place these entities in the relationship of parents, subsidiaries, agents, partners, or joint venturers. No member firm has any authority (actual, apparent, implied or otherwise) to obligate or bind KPMG International or any member firm in any manner whatsoever. The information contained in herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation. For more information, contact KPMG's Federal Tax Legislative and Regulatory Services Group at: + 1 202 533 4366, 1801 K Street NW, Washington, DC 20006.