On 27 September 2023, Brazil's Supreme Court concluded the trial of Extraordinary Appeal No. 1,017,365, which discussed a cut-off date for indigenous occupation as a requirement for demarcation of indigenous lands. Based on a strict interpretation of the Brazilian Constitution, the time limit thesis tried to implement a cut-off date to restrict indigenous land claims, arguing that only indigenous lands occupied on the date of the 1988 Constitution promulgation could be demarcated by the Federal Government. In reviewing the appeal, the Supreme Court not only rejected the time limit requirement, but also established a broad set of criteria covering other relevant aspects to the demarcation of indigenous lands.

Firstly, the Supreme Court defined new circumstances for compensating bona fide private purchasers/owners harmed by subsequent demarcation of indigenous lands. According to the Court's decision, the compensation criteria already provided for in the Constitutional text should also apply when there is traditional indigenous occupation of the land, or a violation of such occupation, contemporaneous to the promulgation of the Constitution. In other cases, where there is no occupation by an indigenous community or a violation thereof on the date of promulgation, landowners should also be compensated in connection with the bare land value, when their resettlement is unfeasible. Also, provided that it is impossible to demarcate the land and return it to indigenous communities, the Supreme Court stated that the Federal Government may create a proportional reserved area on behalf of the indigenous community.

The Supreme Court also ruled that the anthropological report is one of the fundamental elements for the demarcation procedure and is essential for demonstrating the traditional nature of indigenous occupation. Pursuant to the Constitution, only "traditionally occupied" lands can be demarcated on behalf of indigenous communities. In addition, the Supreme Court agreed that demarcated indigenous lands can be resized, provided that there is proof of a serious and insurmountable error in the original administrative demarcation procedure, which can be raised within up to 5 years after the demarcation has been completed.

The final text of the Supreme Court's ruling has not been published yet, but only a few days after the Supreme Court's ruling, Brazil's Congress approved a bill of law validating the 1988 Constitution cut-off date. The validity of the Bill, however, still depends on the President's sanction. The outcome of the Supreme Court's ruling and the sanction or veto of the Bill have the potential to impact hundreds of litigation cases countrywide, which discuss the expropriation of private lands for indigenous land demarcation and relevant compensation in connection therewith, as well as energy, infrastructure, agribusiness and mining projects.

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