On June 14, 2023, Law No. 14,596/2023 was enacted in Brazil, which, among other Transfer Pricing obligations, establishes the registration of controlled commodity export and import transactions, declaring their information in the form and within the deadline established by the Special Secretariat of the Receita Federal (Inland Revenue) of Brazil. Herein, we aim to increase transparency and control in related party transactions, ensuring their performance is at the Arm’s Length Principle.
Mandatory Registration
The new law imposes on companies the obligation to register in detail their commodity transactions when these are among related parties. This registration must provide detailed information on the transaction, agreed prices, traded volume, and other relevant data for tax authorities to assess whether the transactions comply with market conditions.
Specific Regulations
Regulatory Instruction (RI) RFB No. 2246/2024, published on December 30, 2024, amending RI RFB No. 2161/2023, introduces significant amendments to the registration and documentation of controlled commodity transactions, including:
- Appraisal of long-term contracts based on the Arm’s Length principle.
- New detailed registration requirements in e-CAC for export and import transactions.
- Strict deadline for registering contracts applicable to transactions entered into as of January 2025 (*) entered into before 2025.
- Penalties for non-compliance, with specific deadlines and requirements.
- These amendments reinforce the need to carefully align with practices and the correct application of the Transfer Pricing methodology.
(*) In this regard, it should be noted that RI RFB No. 2249, published on February 6, 2025, amends RI RFB No. 2161/2023 to exceptionally extend the deadline to register controlled commodity export and import transactions in specific cases.
Implications for Companies
Companies operating in the commodities sector that engage in related party transactions should prepare to comply with these new registration obligations. They must review and, if necessary, adjust their Transfer Pricing policies to ensure they reflect market conditions and comply with the recent regulations. In addition, they must implement internal control systems to gather and report the required information accurately and promptly.
Get Advised with TPC Group!
At TPC Group, we are Transfer Pricing specialists committed to assisting your company in complying with the new regulations in Brazil. Our experienced team will provide customized advice to ensure commodity transactions are carried out under the law and optimize your international transactions.
Contact us today for a consultation and ensure optimal compliance with your tax obligations!
Source: Jota / Receita Federal do Brasil