Transcript Acquisition of Land by Foreigners

Brazilian Agriculture
Legal Aspects
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TOPICS
(I) Acquisition of Land by Foreigners
(II) Land Title Issues
(III) Licenses
(IV) Environmental Restrictions
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Acquisition of Land by Foreigners
• Law 5.709/71 sets forth restrictions on the acquisition of land by foreigners
and by Brazilian companies owned by foreign capital. This was confirmed by
article 171 of the 1988 Federal Constitution, which established a distinction
between Brazilian companies with foreign and Brazilian capital.
• Constitutional Amendment no. 6 of 1995 revoked article 171 of the 1988
Federal Constitution thus leading to the interpretation (now accepted by the
majority of law scholars and professionals) that the restriction imposed by
Law 5.709/71 on the acquisition of land by Brazilian companies owned by
foreign capital was also revoked.
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Acquisition of Land by Foreigners
• However, the Federal General Counsel Office (AGU) has recently issued an
opinion - currently under review by the Executive – that seeks to revisit the
current legal framework and impose certain restrictions on the acquisition of
land by Brazilian companies owned by foreign capital.
•
It is now uncertain to what extent the new opinion – if in fact it is accepted by
the Executive – would create obstacles to foreign investment in Brazilian
commercial agriculture (particularly in Western Bahia), as its main purpose
seems to be to protect the State of Amazonas, where 55% of the land is owned
by foreigners.
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Land Title Issues
•
Need to analyze ownership certificates
•
Need to analyze situation of current owner
•
Status of the ownership certificates:
(i)
the more developed the area, the better the documentation is;
(ii) LEM and region (one of the first areas in the cerrado to be developed);
(iii) case study – CGI´s land is split in six different ownership certificates.
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Licenses
•
In summary, the farmer shall obtain the following licenses with the local
environmental authority (generally SEMA – “Secretaria de Estado do Meio
Ambiente”):
(i) License to clean the land or, depending on the type of vegetation, a
“License to Deforestation shall be required (a project is developed by a forest
engineer);
(ii) License to operate the farm (upon approval of the farming project – e.g.,
soybean, cotton, corn, etc);
(iii) License to use hydric resources (the use of water for supply, irrigation,
energy generation, etc).
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Licenses
• Besides the licenses above, the farmer shall also apply to :
(i) the IPR (Rural Producer Enrollment) before the Treasury Office of the
State where the farm is located;
(ii) the Certificate of Rural Property Record (CCIR) before the National
Institute of Colonization and Agrarian Reform – INCRA
CCIR is a mandatory rural property document for land parceling,
mortgaging or selling the land;
it is valid for 3 years (renewable) or until there is any modification in
the property enrollment.
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Environmental Restrictions
• Legal Forest Reserve: Federal law defines Legal Forest Reserve as an area
located within a rural property (which does not include the area of permanent
conservation) required for the sustainable use of natural resources,
conservation and rehabilitation of ecological processes, conservation of
biodiversity and protection of native fauna and flora. They may not be
commercially exploited unless by means of “forest management projects”
(projetos de manejo), which require prior authorization by SEMA.
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Environmental Restrictions
• Percentage of property to be set aside for the Legal Reserve:
(i) “Legal” Amazon (Acre, Pará, Amazonas, Roraima, Rondônia, Amapá, Mato
Grosso, regions located North of parallel 13°S of Tocantins and Goiás and West
of meridian of 44°W of Maranhão) – 80%
(ii) Cerrado (Brazilian savanna-like vegetation) located in the “Legal” Amazon –
35%
(iii) Forest or other forms of native vegetation located in the remaining regions of
the country (including Western Bahia) – 20%
(iv) Pradarias located in any region of the country – 20%
• If the rural property is a virgin area, the buyer will have to include in the project
to be submitted to SEMA the area intended to be set aside as Legal Forest
Reserve.
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Environmental Restrictions
• Permanent Conservation Area (APP) is defined by federal legislation as the area
protected, covered or not by native vegetation, with the environmental function
of protecting water resources, landscape, geological stability, biodiversity,
among others. It cannot be subject to exploitation.
• APP are forests and remaining forms of native trees and plant life located:
(i) along rivers or any other stream from its highest level in marginal
strip/vereda;
(ii) around lakes, ponds or water reservoirs;
(iii) in water springs with 50m width.
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THANK YOU
JOSÉ RICARDO DE BASTOS MARTINS
[email protected]
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