Legal Guide for Foreign Investors in Brazil - Apex-Brasil

Legal Guide for Foreign Investors in Brazil
an establishment, work, or activity has been carried out without the appropriate
authorization, i.e., without the necessary installation permits and operating
licenses specified in environmental law, or in violation of licensing conditions,
laws, or regulations.
Under the terms of article 26, environmental crimes are liable to prosecution by
the public authorities, irrespective of a formal complaint by a plaintiff. The law
maintains, with minor alterations, the system established by the Law of Special
Courts (Law 9.099 of September 26, 1995) which permits alternative penalties
and conditional suspension of proceeding, provided two basic conditions are met:
that the penalty of deprivation of freedom established for the damaging act does
not exceed three years; and that the environmental damage has been redressed
(articles 27 and 28 of Law 9.605/98; articles 76 and 89 of Law 9.099/95).
The Law encompasses various forms of environmental degradation caused
by pollution, including the damages caused by mining activities (Section III).
Administrative irregularities (such as lack of the necessary environmental
licensing) and chronic urban land use problems (affecting water sources) do
not escape the purview of the law, which also foresees the imposition of fines,
ranging from a minimum of R$ 50,00 to a maximum R$ 50 million.
13.4. Administrative Sanctions
Decree 3.179 of September 21, 1999 regulates Law 9.605 of February 12, 1998,
updating the list of administrative sanctions applying to activities and conduct
that is detrimental to the environment.
Under article 2 of said Decree, the following penalties are foreseen for corporate
offenders: warning; one-time or daily fine ranging between R$ 50.00 and R$
50 million; seizure, destruction or spoiling of products and disruption of sales;
embargo, suspension or demolition of irregular works or activities; reparation
of damage; and penalties of restriction of rights. The penalties of restriction
of rights entail: suspension or cancellation of registration, license, permit or
authorization of the corporate offender; loss, restriction or suspension of tax
benefits and incentives or credit from official institutions; and prohibition of nay
contracting with government authorities for a period up to three years.
Unlike the other penalties prescribed in the Decree, reparation of damage as an
administrative sanction should not be regarded as a sanction imposed by federal,
state or municipal penalties inspection agencies, since the obligation to effect
full reparation of damage stems from civil liability set out in Law 6.938/81, that
can be imposed independently of administrative and/or criminal sanctions.
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