Brazilian companies that export or import commodities with related parties abroad must comply with a Transfer Pricing requirement that goes beyond annual documentation: the Registro de Transações com Commodities (RTC). Effective January 1, 2025, the Brazilian Federal Revenue Service (RFB, by its Portuguese acronym) requires that each commodity contract entered into with related parties be registered by the tenth day of the month following its execution. For companies seeking Transfer Pricing Services in Brazil, this requirement changes the timing of when the pricing defense is built: no longer at the end of the fiscal year, but on a month-by-month basis.
What is the RTC, and where does it come from?
The RTC is an electronic registry of commodity contracts entered into between related parties, which is filed on the RFB’s Virtual Service Center portal. Its legal basis is Law No. 14,596/2023, which aligned the Brazilian regime with the arm’s-length principle of the Organization for Economic Cooperation and Development (OECD).
Article 12 of that law defines a commodity as a physical product, at any stage of production, whose quoted price on recognized exchanges or through specialized agencies serves as a market reference between independent parties. Article 13 establishes that, when reliable comparable prices exist, the Comparable Uncontrolled Price (PIC/CUP) method is the most appropriate, unless circumstances justify another method.
The RFB Normative Instruction (IN) No. 2,161/2023 implemented the law. The RFB Normative Instruction No. 2,246/2024, published on December 31, 2024, amended Articles 37, 38, 60, and 64 and extended the registration requirement to all controlled transactions involving commodities, effective January 1, 2025.
Who must register, and which transactions?
Any legal entity domiciled in Brazil that exports or imports commodities in controlled foreign transactions—that is, with related parties abroad—must register. Prior to 2025, registration was limited to transactions valued using the PIC method; under IN RFB No. 2,246/2024, it now applies to all commodity transactions subject to Transfer Pricing rules.
The deadline is monthly. The contract must be registered by the tenth day of the month following the month in which it was entered into. The reference date is the date the contract was entered into, not the shipment date or the invoice date. Therefore, the sales and tax teams must share the same information within the same month.
What information is required, and why is the price-setting date important?
Article 38 of IN RFB No. 2,161/2023, as currently in effect, requires the following information to be recorded:
- the contract identification;
- the details of the declarant and the parties;
- the details of the commodity and the transactions;
- the date or range of dates used to determine the price;
- the reference sources and the pricing method.
The most critical factor is the price determination date. Article 13, paragraph 3, of Law No. 14,596/2023 authorizes the use of the date agreed upon by the parties, provided that the taxpayer substantiates it in a timely manner and it corresponds to actual conduct. If this is not the case, paragraph 4 authorizes the RFB to select a quotation date consistent with the facts or, in the absence thereof, the average of quotations as of the date of the shipment or import declaration.
In volatile markets, even a few days’ difference in the quotation date can alter the arm’s-length price. For this reason, the RTC is not a standalone procedure: it is the record that RFB regulations require to ensure timely documentation of that date.
What are the consequences of failing to register?
The IN RFB No. 2,161/2023 refers to the penalties under Article 35, Item I of Law No. 14,596/2023. Late filing is penalized at 0.2% of gross revenue per calendar month or fraction thereof (subitem a). Non-compliant filing is penalized at 3% of gross revenue (subitem c). In both cases, the penalty ranges from a minimum of BRL 20,000 to a maximum of BRL 5,000,000.
The substantive consequence may be even greater than the penalty itself. Without a timely registration, the company loses the documentary support for its pricing date, allowing the RFB to value the transaction using the quotation date it deems consistent with the facts—which may result in a transfer pricing adjustment.
At TPC Group, in every analysis of commodity transactions in Brazil, we evaluate the consistency between the agreed-upon pricing date, the actual conduct of the parties, and the information reported in the RTC. Our objective is to support an arm’s-length price that is technically defensible before the RFB.