New Gold Rules in Brazil
Gold Provisional Measure
Amsterdam, 26 april 2023– According to reports from Brazilian media, Brasilia has concluded the Gold Provisional Measure (MP) which eliminates the concept of good faith and mandates the use of electronic invoices for the purchase, sale, and transportation of gold within the country.
The Justice Minister, Flávio Dino, has already signed the document, and it will also be signed by the ministries of Finance, Mines and Energy, Environment, and Indigenous Peoples, all of whom contributed to its drafting.
The Document’s Journey: From Civil House to National Congress
Once sent to the Civil House, the document will then be signed by President Luiz Inácio Lula da Silva before being forwarded to the National Congress. Despite the immediate validity of its contents, confirmation by Parliament is required for the document to maintain its effectiveness, the agency clarified.
The proposal is the result of a working group created by the Justice Ministry.
The government aims to address illegal mining on indigenous lands and conservation units, primarily in the Amazon, and eliminate legal loopholes that allow for evasion of ore chain regulation through the MP.
Gold Trade in Brazil to Face Increased Regulations with New Provisional Measure
- Today, in Brazil, there is less control over gold than over wood or meat. With the provisional measure presented and already agreed with all government agencies, the individual who sells gold will have a series of regulatory mechanisms,” Secretary of Access to Justice Marivaldo Pereira said in a statement.
Between 2015 and 2020, the country traded 229 tons of gold with evidence of illegality, according to a study by the Choices Institute.
The Devastating Impact of Illegal Mining in the Brazilian Amazon: A Call to Action
Following the government’s declaration of an emergency due to the destruction caused by illegal mining in the Yanomami Indigenous Land in Roraima, an MP has been introduced. The humanitarian crisis in the region has resulted in the loss of an estimated 500 indigenous children’s lives. The Alliance in Defense of Territories report reveals that the number of mines in the Brazilian Amazon has quadrupled between 2010 and 2020.
The Gold PM provides for:
- – Control by the National Mining Agency.
- – System of Traceability of Transportation and Custody.
- – Penalty of seizure and confiscation if rules are not followed.
- – Requirement of electronic invoices: in March, the Federal Revenue Service established the requirement for issuing electronic invoices for deals with gold as a financial asset or exchange instrument, which will come into force in July. Currently, transactions are recorded on paper notes.
- – The first sale of gold can only be made by entities authorized by the Central Bank (BC).
- – Purchases must be paid for by bank transfer.
- – End of the presumption of good faith: Currently, a 2013 law allows gold to be considered legal based on information provided by the seller of the ore and the good faith of the buyer.
- – Possibility of liability for links in the gold buying and selling chain.