Banking, insurance and finance
A new method of payment will allow the transfer of funds in real-time starting in November. Click here to see the criteria and forms of participation in the system.
In a new series of articles, we look at the changes that should affect the Brazilian Financial System in the coming years.
The Central Bank of Brazil (BCB) opened for public consultation, on November 28, drafts of a joint regulatory act of the National Monetary Council (CMN) and the BCB and a BCB Circular dealing with the introduction of a “Controlled Testing Environment for Financial and Payment Systems Innovations” (Regulatory Sandbox) under the National Financial System and the Brazilian Payments System.[1]
On September 20, 2019, Federal Law No. 13,874/19 was enacted, setting forth the Declaration of Rights of Economic Freedom. Among the changes promoted by the new law, we highlight innovations for the investment fund industry, with the introduction of a new chapter in the Brazilian Civil Code on the subject (articles 1,368-C to 1,368-F).
Presidential Decree No. 10,029/19, published on September 27, authorized the Central Bank of Brazil (BCB) to recognize the following as being in the interest of the Brazilian government: (i) installation in Brazil of new branches of financial institutions domiciled abroad; and (ii) increase in the percentage of equity in the capital of financial institutions headquartered in Brazil, held by individuals or legal entities resident or domiciled abroad.
On October 7, the Executive Branch forwarded to the National Congress Bill (PL) No. 5,387/19, which allows for implementation one of the objectives of the current management of the Central Bank of Brazil (BCB) mentioned by the president of that organization, in his inauguration ceremony in March of this year: “to make the market more open to foreigners, with a possible convertible currency[1] that serves as a reference for the region."
Law No. 12,414/11, as amended and regulated by Decree No. 9,936/19, regulated the formation and consultation of databases with information on performance, mandating, in its article 12, paragraph 3, that the National Monetary Council (CMN) adopt complementary measures and standards on the provision of information by institutions authorized to operate by the Central Bank of Brazil (BC).
Executive Order No. 881 (MP 881), issued on April 30 of this year, aims to ensure and foster economic freedom in Brazil, as well as reduce bureaucracy in various industries.
Legal entities and investment funds incorporated in Brazil have until August 15 to submit a report to the Central Bank of Brazil, detailing investments in their quotas and/or shares held by foreign investors on December 31 of the previous fiscal year, or the outstanding short-term trade debts owed to non-residents on the same date, in the following situations:
In 2013, shortly after scandals involving the manipulation of exchange rates and interest rates became public, the International Organization of Securities Commissions (IOSCO) published a report in response to a consultation on rules applicable to financial benchmarks. Not surprisingly, concerns were raised about the fragility of certain benchmarks, particularly in terms of integrity and continuity.
Individuals and legal entities resident, domiciled or with headquarters in Brazil, as provided for in tax law, must report to the Central Bank of Brazil the assets and amounts held by them outside the country.
Resolution No. 4,662 of the National Monetary Council (CMN), issued on May 25 of this year, provides for the requirement of a bilateral margin of guarantee on transactions with derivative financial instruments carried out in Brazil or abroad by financial institutions and other institutions authorized to operate by the Central Bank of Brazil (Bacen).
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