STF has deemed constitutional the CONFAZ regulation requiring financial institutions to provide information on electronic transactions
The Supreme Court (STF), in a plenary ruling on Direct Action of Unconstitutionality 7276/DF (ADI), validated the rules established by the 2016 ICMS Agreement 134 of the National Council for Financial Policy (CONFAZ).
According to the Agreement, financial institutions must provide state governments with information on bank transfers and payments made by their clients in electronic transactions (PIX, transfers, and credit and debit card payments) involving ICMS tax collection.
The ADI was filed by the National Confederation of the Financial System (CONSIF), which argued that the CONFAZ regulation constitutes an illegal breach of banking secrecy, violating constitutional guarantees of privacy, intimacy, communication confidentiality, and digital data protection.
The STF's majority opinion, which upheld the constitutionality of providing the data, was based on the vote of Justice Carmen Lúcia, followed by Justices Alexandre de Moraes, Edson Fachin, Flávio Dino, Dias Toffoli, and Luiz Fux. In her ruling, it was established that the transfer of such information does not represent a breach of banking secrecy, but rather a transfer of this confidentiality from financial institutions to state tax authorities.
Thus, any data provided to the states would be used solely for monitoring tax payments, particularly the ICMS, and state governments are required to preserve the confidentiality of the information.
The dissenting opinion, which found the regulation unconstitutional, was led by Justice Gilmar Mendes, supported by Justices Nunes Marques, Cristiano Zanin, André Mendonça, and Luís Roberto Barroso. According to the dissenting vote, the CONFAZ regulation does not establish clear criteria for the transfer, storage, and maintenance of the confidentiality of this information.
The STF's validation of the CONFAZ regulation raises concerns in the context of relaxed rules for data sharing. Without clear guidelines and rules on the matter from the Court itself, there is a risk that banking information could be shared with unauthorized parties without judicial approval – which undoubtedly increases the risk of illegal breaches of secrecy, endorsed by numerous Supreme Court rulings.
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