O bill which establishes a legal framework for critical and strategic mineralsapproved this Wednesday (6) night by the Chamber of Deputies, still requires adjustments to avoid negative impacts on attracting investments and developing projects.
This is the predominant assessment in the private sectorwhich intends to seek these adjustments during the project’s progress in the Senate.
According to reports made to CNN, the president of the Senate, Davi Alcolumbre (União-AP), has been following the matter with interest and does not intend to stop it. However, there has not yet been an informal choice of a rapporteur in the House.
In the evaluation of mining companies that actively participated in the proposal negotiations and prefer to remain anonymous, Some points of the recently approved project excessively expand state intervention, increase regulatory bureaucracy and may create insecurity for investors.
There is broad recognition of the work carried out by deputy Arnaldo Jardim (Cidadania-SP), rapporteur in the Chamber, on improvements to the text.
A creation of a guarantee fund of R$2 billion (to facilitate company financing) and the forecast of up to R$5 billion in tax incentivesas there is greater added value in projects, are celebrated points.
Mining companies also breathed a sigh of relief with the withdrawal of prior approval from the future Special Council for Critical and Strategic Minerals, dominated by the government, for corporate operations in the sector.
However, they still see the need to improve three devices:
- Mandatory verticalization: there is a perception that the approved text was vague. The transition from the incentive to the requirement for local processing changes the business model of mining companies, which will have to invest in processing plants on national soil. This is seen as worrying.
- Sovereignty and export control: the State resumes an active role in regulating the outflow of critical minerals, being able to intervene to guarantee the supply of the national battery and semiconductor industry.
- Legal and social security: the detailed inclusion of consultation rites with traditional communities and foreign investment filters aim to reduce future judicialization, although they increase the rigor of initial compliance.
A consensus in the private sector is to try to obtain, in the Senate, the application of the Lei do Bem for critical and strategic mineral projects. In the Chamber, the proposal has already incorporated incentives such as Reidi and the possibility of issuing incentivized debentures.
The so-called Lei do Bem, which was not included in the list of possibilities for use by mining companies, provides tax incentives — such as discounts on Income Tax and CSLL — for innovation and research.
