SIGNIFICANT REAL ESTATE AND ENVIRONMENTAL ASPECTS OF THE BILL OF THE NEW MINING CODE, by Anna Lyvia Ribeiro and Flavia Moller and Georgia Gomes

Considering the essentiality of the mineral resources for the industrial development and for technological advances, there is a large global demand for investments in the mining sector. In the exercise of this activity, it is extremely important that investors identify possible restrictions to the use of the soil and subsoil, evaluating, together, the regulatory, environmental and real estate characteristics of the areas of interest.

REAL ESTATE AND ENVIRONMENTAL ASPECTS - Anna Lyvia Ribeiro, Flavia Moller and Georgia Gomes

SIGNIFICANT REAL ESTATE AND ENVIRONMENTAL ASPECTS OF THE BILL OF THE NEW MINING CODE

Considering the essentiality of the mineral resources for the industrial development and for technological advances, there is a large global demand for investments in the mining sector. In the exercise of this activity, it is extremely important that investors identify possible restrictions to the use of the soil and subsoil, evaluating, together, the regulatory, environmental and real estate characteristics of the areas of interest.

As it has been widely disclosed by the media, there is intent to approve, in Brazil, a new Regulatory Framework of Mining. In June 2013, Bill No. 5.807/2013 was presented by the Executive Branch to replace the current legislation (DecreeLaw No. 227/1967). With a new Mining Code, the Government seems to intend to increase governmental revenues from this industry (e.g. by increasing the tax basis and tax rates of royalties) and its intervention in the development policies of the mining sector, with the creation of the National Council on Mining Policy and the determination of strategic areas.

In order to regulate the use and occupation of the properties object of mining exploitation, the current Code Real 

provides for the possibility of institution of right of way (without the need of prior negotiation with the owner or tenant of the area), for survey or mining purposes, not only in regard to the areas where the mine is located but also in the boundary areas.

The Bill, on the other hand, provides for the responsibility of the Granting Authority to declare, by decree, the public utility for purposes of expropriation or the institution of administrative right of way – actual right of public nature – of the areas necessary to the mining activity, in case of failure of the negotiation between the mining company and the owner of the soil. 

Heed should be paid to the possibility of expropriation due to declaration of public utility, this hypothesis is not provided for in the current model. The expropriation should be conducted under agreement or in court within five years from the enactment of the respective decree.

Also, it is necessary, prior to the declaration of public utility or institution of right of way, to attempt to negotiate with the owner of the area, which may lead us to its acquisition by the mining company. In case of rural property, the special legislation about the restrictions to the acquisition of rural properties by Brazilian companies with foreign control should be carefully analyzed.

The Bill also proposes, as one of its guidelines, the sustainable development, with the recovery of environmental damages caused by the mining activity. Accordingly, the stages of closing of the mine and discontinuance of activities should include the recovery of the environmental conditions of the affected areas, according to technical solutions required by the proper environmental agencies for the licensing.

Even if such measure is usually required by such agency, according to the legislation in force, heed should be paid to the fact that the obligation of recovery of environmental damages is not expressly included in the current model.

The actions of environmental recovery may involve a series of aspects, such as recovery of the suppressed vegetation, protection of water springs, water courses and respective areas of permanent preservation, proper disposal of rejects and adoption of compensatory measures focused on the suppression of underground cavities.

We point out that the Bill is still being handled in the Congress, with no outlook of approval.

ENVIRONMENTAL - Yuri Marinho, Carolina C. Branco and Thais Moreno

Environmental reserve quota: incentive for preservation and for new businesses

An important mechanism that has gained power and which, certainly, will contribute significantly with the preservation of the environment is the Environmental Reserve Quota (CRA), provided for by Federal Law No.12.651/2012.

The CRA is an institute whose purpose is to allow the compensation of the preservation of the Legal Reserve in rural properties, and is used as alternative for those who cannot directly comply with their legal commitment.

It is defined by the legislation as a nominative title representative of area with native vegetation, existing or in process of recovery, corresponding to 1 (one) hectare of forest, and it is issued by the qualified agency (federal or state) in favor of the owner. The legislation established the possibility of transfer, either remunerated or free of charge, of the CRA to an individual or public or private legal entity, upon signing of the term by the holder of the CRA and by the acquirer.
The CRA may be negotiated for purposes of regularization of the properties with non- preserved native vegetation, as required by the law. Accordingly, the CRA is a type of incentive for acts of environmental preservation and maintenance, encouraging new businesses involving environmental assets, which brings benefits to the environment as well as to the owner or rural producer.

However, so that the instrument may positively change the rural reality in Brazil, either by regularizing properties without vegetation, or by remunerating owners of areas with large forest coverage, the instrument must be regularized at federal or state level.

Currently, the States of Amazonas, Pará, São Paulo, Goiás and Bahia are at advanced stage of implementation of the state system by which it will be possible to issue the CRAs. The other Brazilian States are also handling the issue, but at a slower pace.

REAL ESTATE – Bruno Eduardo Pereira Costa

How to acquire islands in Brazilslands are definitively a refuge for few people. The acquisition of islands, whether due to specificity or to shortage, has its particularities. Conceptually, assets, in regard to their ownership, may be public and particular (or private). Islands may be classified likewise.

Fluvial and lacustrine islands, oceanic and seashore islands are, pursuant to article 20, IV of the Federal Constitution, assets of the Federal Government; public assets. Oceanic islands are those far away from the coast and have nothing to do with the relief of the continent or of the underwater platform. Seashore islands, in turn, are those that result from the continental relief or the underwater platform. Fluvial islands are those formed in watercourses. According to article 1.249 of the Civil Code and articles 23 to 25 of the Water Code, islands formed in the course of private rivers (whose definition as to the nature follows the classification of the property where they are located) are, in the respective stretch, private.

According to the Water Code, islands formed at the stream bed are of public domain. Accordingly, islands formed at the course of rivers may be both public and private, depending on the nature of the river.

There are no relevant restrictions for negotiation of private islands. The acquisition procedure will not contain any specific requirement, only the fulfillment of the elements of the legal business and the presentation, to the proper real estate registry office, of the instrument of transmission of the property (for example, the deed).

As to public islands, they may only be sold with prior authorization of the president of Brazil and provided that there is no public, economic or social
interest in the maintenance of the property by the Federal Government, and such sale cannot be inconvenient to the environmental preservation and to the national defense. In case of sale, it will occur through bid or public auction and pursuant to the terms of Law No. 9.636/1998.

If the Federal Government does not intend to make the sale, the interested party will only have the option of its use, under the terms of Law No. 9.760/1946, which rules the properties of the Federal Government.

In brief summary, according to article 64 of said law, there are three possibilities, namely: the rent, fee farm {aforamento] and assignment. The rent will occur when it is convenient to make the property productive, if the purpose is the exploitation of fruits or provision of services. The Federal Government will hold the total ownership. The fee farm will occur when there are the convenience of fixing the individual to the soil and the maintenance of the property as public. The assignment will occur when the Federal Government intends to assist or colaborate as deemed necessary.

In any type, the procedure will demand the performance of an administrative procedure before the Secretariat of Heritage of the Federal Government – SPU. The procedure and the registry/ approval of the respective instrument in the record of the property will also be required before the proper Registry Office.

The acquisition of islands in Brazil will, therefore, depend on the identification of their nature and, subsequently, after the checking of its regularity, on the status of the procedure necessary to register the proper instrument.