In order to better regulate the legal environmental aspects of activities that impact the environment or that use natural resources in Brazil, and also to facilitate the environmental licensing proceedings, we have recently seen changes in the law at the federal level, allowing those who want to invest in infrastructure projects in Brazil to feel more confident. In this regard, we have the new Forest Code and a number of regulations regarding the environmental licensing proceedings covering transmission lines, roads, ports and terminals, as well as oil and gas exploitation and production.
Federal Law No. 12.651/2012, or the new Forest Code, as it is commonly called, which provides for the protection of native vegetation and repeals the previous Forest Code that has been in effect since 1965, came into force on May 28, 2012. Notable among the changes are the reduction of Permanent Preservation Areas (APPs) at the boundaries of artificial dams. Instead of the old limits of 30 and 100 meters of APPs in urban and rural areas respectively, new enterprises working with energy generation and water supply now have the possibility of maintaining a minimum area of just 15 meters or 30 meters in urban and rural areas respectively.
Another important benefit is the exemption from maintaining a percentage of native vegetation – 'Legal Reserve' – on rural properties used for power generation purposes, including its transmission and distribution. In the past, the obligation to maintain the Legal Reserve in areas of power generation was controversial since the activity and the areas were considered to be of public interest.
Similarly, in October 2011, the Ministry of the Environment issued new rules to decrease the complexity of licensing proceedings at federal level to hasten the process, as well as to assure the interpretation of the law so as to mitigate risk for investors. For instance, such rules establish deadlines for the issue of environmental licenses by the Brazilian Institute of Environment and Renewable Natural Resources (IBAMA), and also to limit the number of times this Agency may request additional information and/or studies from entrepreneurs in order to complement the environmental licensing proceedings.
The new Forest Code and the rules from the Ministry of the Environment may be considered an improvement to Brazil's environmental laws, as they bring more objectivity and clarity to the implementation of infrastructure projects in Brazil, especially in terms of power generation activities and the implementation of roads, ports and terminals, as well as oil and gas extraction and production. Considering these developments, legal support is important for a better understanding of the implications of the recent legislation and in order to be able to seize their benefits to their full extent.
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