Decree No. 7.878, of December 27, 2012: Establishment of Fixing for IOF/TVM Derivatives
December 28, 2012
Today (December 28, 2012) Decree No. 7,878, of December 27, 2012 (“Decree No. 7,878/2012”) was published in the Brazilian Federal Official Gazette, including paragraph 14 into article 32-C of Decree No. 6,306, of December 14, 2007 (“Decree No. 6,306/2007”), which regulates the Tax on Credit, Foreign Exchange (“FX”), Insurance or Bonds’ and Securities’ Transactions (“IOF”) – the “IOF Regulation”.
According to this new paragraph, whenever the valid exchange rate for a given day is defined as the same exchange rate of the immediately previous working day due to a prior resolution of the Brazilian Central Bank, the immediately previous working day shall be considered as the acquisition, sale or expiration date (i.e., date in which the FX exposure of the relevant financial derivative contract is either initiated or terminated, totally or partially, by the determination of parameters used in the calculation of the settlement value of the relevant contract) for the exposures whose acquisition, sale or expiration takes place on such date, being the taxpayers themselves liable for consolidating the exposures of such days.
The changes brought by Decree No. 7.878/2012 have entered into force on the date of its publication (i.e., December 28, 2012).
THIS IS MERELY AN INFORMATIVE NEWSLETTER, RESTRICTED TO VELLOZA & GIROTTO CLIENTS. QUESTIONS AND CLARIFICATIONS ON THE MATTERS CONTAINED HEREIN SHOULD BE ADDRESSED TO OUR OFFICE.
