Theproposed change is a law, PL – Projeto de Lei 4440/2001, originated andapproved by Camara dos Deputados.

Now,it is pending approval of the Senate and then it needs to be approved by thePresident.

Thenew law would not ban foreign ownership of agricultural land, but it would sethigh restrictions on the properties inside the area known as Amazonia Legaland areas on the borders of states located on the North and Central-Westregions.

AmazoniaLegal represents 61% of the area of Brazil and it included the states of Acre,Amapa, Amazonas, Mato Grosso, Rondonia, Roraima, Tocantins, Para, and part ofMaranhao.

Twolaws already regulate the acquisition of rural land by foreigners: Law 5709 of1971 (acquisition of rural properties by foreigners) and Law 6634 of 1979(acquisition of rural areas next to the borders of Brazil by foreigners).

Thenew project of law changes part of those two laws. If approved, foreigners(person or company) will not be allowed to acquire rural areas, inside AmazoniaLegal, larger than 15 fiscal modules, unless they have been in the countryfor more than 10 years. Even if the foreigner has been in the country for morethan 10 years, the limit for foreigners is 50 fiscal modules (this limitalready exists).

Thefiscal module is a unit that varies according to municipal laws.

Thenew law will forbid foreigners to own land located within 150 kilometers of theborders of Brazil in North and Central-West regions. The legislation that iscurrently valid allows foreigners to own land in this area, if the NationalDefense Council grants approval.

Gustavo Pascoal

Departamento Jurídico