The Public Federal Prosecutor's Office requested the National Council of Justice to take measures aimed to enforce the Law n. 5.709/71 which imposes restrictions on the acquisition and lease of rural properties by foreigners.
The aforementioned measures oblige all real estate registries to keep a special cadastre of the transactions involving the lease of rural properties by foreigners, and provide all the information quarterly regarding these transactions to the State Courts, National Institute of Colonization and Agrarian Reform (INCRA), Ministry of Agriculture and to the Executive Secretariat of the National Defense Council, whenever it is necessary.
The lease and acquisition of rural properties by national legal entities which are controlled by foreigners became subjected to the restrictions imposed by the Law n. 5.709/71, after the Opinion AGU/LA-01/2010, in which the Office of the Federal Attorney General (AGU) gave a new interpretation to the matter.
Since then, this matter has become more and more controversial and brought insecurity to companies and foreign investors that are willing to invest in Brazil, or already have projects or legitimate businesses that generate income and employment to the country.
In many cases, companies already established or aiming to expand their business end up being subjected to the effects of the legislation. The same happens with projects that are being developed or carried out in Brazil.
From a legal perspective, the new interpretation AGU gave to the matter is questionable. If on one hand, it is necessary to safeguard the principles of the legislation, such as the defense of the national sovereignty, on the other, it is also essential to protect and increase foreign investments in the country.
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*Luis Gustavo Miranda, Paulo Teixeira Fernandes and Júlia Melo Carvalho Ribeiro are lawyers of Rolim, Viotti & Leite Campos Advogados
