Legal Guide for Foreign Investors in Brazil - Apex-Brasil

Legal Guide for Foreign Investors in Brazil
on Circulation of Goods and Services), a state tax foreseen in the Federal
Constitution.
16.8. Incentives
Brazilian law offers the providers of telecommunications services incentives for
development of telecommunications products, through specific credit, tax, and
customs policy instruments.
Thus, although the Brazilian Government has practically eliminated ex-tariff
special importation regulations, significant exceptions are now in effect for
certain components used in telecommunications, which had formerly been
liable to import duties of up to16%.
Law 10176, of January 11, 2001, renewed the IPI tax exemption until December
31, 2000 on the items a variety of specified items. Since that date exemptions
have been converted into reductions of applicable IPI rates. The percentage
reduction is due to be gradually reduced until December 31, 2009, when full
rates are to be applied.
16.9. The Future of Telecommunication Services
Major debate is currently in course in view of convergence. The Brazilian model
of license granting by technology is under analysis as well as the issues arising
from a possible segregation of infra-structure from service providers.
A variety of bills currently before the National Congress aim to promote
harmonization of subscriber TV and broadcasting legislation, while promoting
digital inclusion. In view of that, the delivery of content by telecommunication
operators and the relevance of constitutional limitations on foreign capital in the
broadcasting industry are also currently in discussion.
A bill on the powers of Brazilian regulatory agencies currently under discussion
by the National Congress may significantly alter the status of ANATEL, its
powers to grant telecommunications licenses, and its role of controlling and
preventing breaches of the economic order and ensuring fair competition.
Another priority for the government is solution of legal impediments to the use of
FUST resources to achieve universal service goals, which entails an amendment
to the General Telecommunication Law.
In fact, one of ANATEL´s strategic aims for 2007 is universalization, that is, to
promote the access of telecommunication services at all national territory, in
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