The Brazilian government is tightening a law that restricts the amount of land foreigners can buy in a move that is aimed at preventing foreign investors from circumventing the interpretation of a law that restricts their direct acquisition of land.
The move comes after agricultural minister Wagner Rossi recently hinted that changes were afoot. ‘We need to distinguish properly on the one hand between speculators and sovereign funds, which are a threat to our sovereignty, and on the other side, foreign investors who come with good projects,’ he said.
It is understood that a new decree will prohibit non Brazilians from buying controlling shares of companies that own vast tracts of territory in the country. Brazilian Attorney General Luiz Inacio Adams has confirmed in a statement that a new ruling exists. According to O Estado de Sao Paulo the Attorney General’s Office has already issued copies of the ruling to state commerce councils responsible for the registration of company agreements.
It’s not clear if deals already agreed could be suspended by tribunals. Since 1971 the Brazilian government has limited the outright purchase of rural farmland by foreigners or companies based abroad for food security reasons. The law says that foreigners can own no more than one fourth of a county, and no one nationality can own more than 10%.
Source: NuWire InvestorGoogle+