Enhanced Monitoring Report on the Implementation of the Standard on Transparency and Exchange of Information on Request 2025

Brazil

Brazil joined the Global Forum in 2009. Brazil underwent its Second Round of EOIR Peer Review in 2018 (Brazil’s 2018 Report),1 which assessed its legal and regulatory framework in force as at 23 July 2018 and its practical implementation, including in respect of EOI requests received and sent during the review period from 1 October 2014 to 30 September 2017. Brazil received an overall rating of Largely Compliant and the individual Elements were rated as follows:

 

	A.1	A.2	A.3	B.1	B.2	C.1	C.2	C.3	C.4	C.5	Overall
Determinations	i.p.b.	i.p	i.p.b.	i.p.	i.p.b	i.p.	i.p.	i.p.	i.p.	n.a.	LC
Ratings	LC	C	LC	C	LC	C	C	C	C	PC

Status of implementation of recommendations issued in the peer review report

Brazil received nine in-box recommendations in relation to Elements A.1, A.3, B.1, B.2, C.4 and C.5.

This monitoring report assesses the actions taken by Brazil to address the recommendations issued in its EOIR Peer Review Report and the peer input received for the monitoring period 2023-2024.

The report concludes that seven recommendations are “in the process of being addressed” and two recommendations are “no longer sufficiently material”, and it advises on actions required.

Element A.1: Availability of ownership and identity information

1. Absence of sanctions for non-compliance with beneficial ownership obligations by domestic legal entities

 

Recommendation (A.1, framework)	Brazil should ensure there are clearly applicable and appropriate penalties or sanctions for domestic entities that fail to provide beneficial ownership information to the register.
Underlying factor	There is no clearly applicable sanction for domestic entities that do not comply with their obligations to provide beneficial ownership information to the CNPJ [National Register of Legal Persons]. (see paragraphs 85 to 87 in the Brazil’s 2018 Report for more information).
Summary of actions reported	Brazil introduced legislative amendments to better address non-compliance with beneficial ownership reporting obligations (Ordinance RFB (IN) 2119/2022). Such amendments were implemented in 2023. As a result, both domestic and foreign entities that fail to provide their beneficial ownership information to the National Register of Legal Persons administered by the Tax Administration would be suspended in the tax database, which would prevent them from transacting with banking institutions (including operating bank accounts), making financial investments and obtaining loans. If such entities do not comply with their tax obligations within 180 days from the date in which they are suspended, their tax registration would be cancelled (Articles 31, 37 and 56).
Conclusion	Brazil has made progress to address the recommendation. It has introduced administrative sanctions for domestic entities, but they are not sufficient to ensure the dissuasiveness and effectiveness of the system in place. These sanctions consist of suspending or cancelling tax registration. However, in the absence of other enforcement measures, rather than promoting compliance and serving as an enforcement mechanism, the new sanctions could make supervision more challenging by increasing the number of suspended or cancelled entities, thereby requiring more effort and resources to manage and mitigate the associated risks (see Recommendation 2). Furthermore, the absence of mechanism to ensure that changes in beneficial ownership information are brought to the attention of legal entities raises doubts as to whether up-to-date information is available for entities to fully comply with their beneficial ownership reporting obligations. Brazil should report further progress in its next self-assessment.
Status determined	In the process of being addressed.
Actions required	In its next self-assessment, Brazil should – Report further progress on the actions taken to introduce proportionate and dissuasive sanctions to ensure compliance with the obligations relating to the availability of accurate, adequate and up-to-date beneficial ownership information, including appropriate actions to ensure that changes in beneficial ownership information are brought to the attention of legal entities.

2. Monitoring activities over suspended entities maintaining legal personality

 

Recommendation (A.1, practice)	Brazil should ensure that legal and beneficial ownership information is available in respect of all legal entities and arrangements, and monitor the situation of entities with a suspended or cancelled tax registration to ensure that they comply with all relevant obligations to maintain and file up-to-date ownership information.
Underlying factor	Legal entities and arrangements that have their CNPJ [National Register of Legal Persons] tax registration suspended or cancelled by the RFB [Tax Administration] do not automatically lose their trade or civil registration and legal personality. There could be circumstances in which entities remain in existence and their obligations to maintain or file up-to-date legal and beneficial ownership information remain unsupervised. (see paragraphs 73 to 75 in the Brazil’s 2018 Report for more information).
Summary of actions reported	Brazil formed, within the Tax Administration, a team in charge of monitoring entities whose tax registration was suspended or cancelled, to ensure availability of their ownership information. This team has assessed the risks related to entities whose tax registration has been cancelled or suspended and proposed some actions that can be taken to address the recommendation. This proposal is currently under analysis. In addition, Brazil is working on enhancing its beneficial ownership centralised register (see actions reported under Recommendation 3). The technological project is ongoing, and the new register is planned for launch in January 2026. Brazil expects that this new tool will help it to improve compliance monitoring, including that of suspended entities, as it will make it easier to cross-check and share information of suspended entities with other public entities.
Conclusion	Brazil has made progress to address the recommendation. It has taken concrete action to enhance the functionalities of the beneficial ownership register that are expected to reinforce the supervision of suspended entities and reducing the risk of unavailability of their ownership information. However, Brazil has not yet provided information on the measures taken to monitor the availability of ownership information relating to suspended entities or to mitigate the risks associated with their suspended/cancelled status while they retain indefinitely their legal personality. Brazil should report further progress in its next self-assessment.
Status determined	In the process of being addressed.
Actions required	In its next self-assessment, Brazil should – Provide an update on the status of its proposal for legislative changes to strengthen the supervision of entities whose tax registration has been cancelled or suspended, to ensure that they comply with all relevant obligations to maintain and file up-to-date beneficial ownership information. Provide an update on the status of its proposal for other legislative changes that are under analysis. Provide an update on the implementation of the new functionalities of the beneficial ownership register and its use to monitor suspended entities. Provide statistical information on the number of entities whose tax registration has been cancelled or suspended, the percentage these entities represent over the total of legal entities existing in Brazil and supporting statistical information on monitoring and enforcement actions carried out. Describe the measures taken to assess and mitigate the risk of non-availability of adequate, accurate and up-to-date legal and beneficial ownership information for entities that retain their civil registration and legal personality after losing their tax registration, including monitoring and enforcement actions carried out.

3. Supervision and enforcement measures regarding the beneficial ownership register

 

Recommendation (A.1, practice)	Brazil should fully develop a supervision and enforcement programme in relation to its beneficial ownership register as soon as possible and monitor its effectiveness in practice to ensure the availability of beneficial ownership information in all cases.
Underlying factor	Brazil is in the initial stages of developing a supervision and enforcement programme in relation to its beneficial ownership register. (see paragraphs 76 to 87 in the Brazil’s 2018 Report for more information).
Summary of actions reported	Brazil has implemented tools for risk analysis and monitoring of reported beneficial ownership information. Brazil is working on new functionalities of the beneficial ownership register, which will facilitate data cross-checking.
Conclusions	Brazil has made progress to address the recommendation. It should report further progress in its next self-assessment.
Status determined	In the process of being addressed.
Actions required	In its next self-assessment, Brazil should – Provide an update on the status of the new functionalities of the beneficial ownership register. Report on actions taken to ensure the correct identification of beneficial owners in line with the standard. Provide details on the supervision carried out during the corresponding monitoring period. This includes the extent of initial compliance (i.e. ratio/percentage of existing legal entities and arrangements that have reported their beneficial ownership information to the Tax Administration), filing of updated information, measures taken to enforce compliance (for instance, statistical details of supervisory measures like inspections, the results of these controls and sanctions imposed, if any), a description of the selection of cases for control and verification, and any other measures taken to raise awareness and compliance.

Element A.3: Availability of banking information

4. Methodology for the identification of beneficial owners of account holders

 

Recommendation (A.3, framework)	Brazil should take appropriate measures to ensure that beneficial ownership information is available in line with the standard for all account holders.
Underlying factor	The AML/CFT legal framework does not explicitly provide for a beneficial owner identification method in respect of legal persons and arrangements fully in line with the standard. This may have led to beneficial ownership information in respect of bank accounts not being available in line with the standard in all cases, although this remained untested in the review period. (see paragraphs 94 to 97 and 126 in the Brazil’s 2018 Report for more information).
Summary of actions reported	Brazil informed that it regularly conducts assessments to verify financial institutions’ compliance, including the verification and accuracy of beneficial ownership information of their clients. During the monitoring period, Brazil completed the verification process of nine financial institutions’ compliance to the common reporting standard. These audits were focused on certain types of account holders and covered also the identification of their beneficial owners and whether the information available is adequate, accurate and up to date, including the verification of the type of control exercised (whether through ownership or other means of control). The shortcomings observed regarding the identification of beneficial owners were limited to missing elements of identity information, which were immediately corrected during audits. Brazil confirmed that other than this, during these audits it was observed that financial institutions identify the beneficial owner of their clients in line with the standard.
Conclusion	Brazil has made progress to address the recommendation. While no legal or regulatory change has been reported with respect to the legal deficiencies identified in the 2018 Report, Brazil has regularly supervised financial institutions’ compliance with their obligation to identify beneficial owners in line with the standard. Although it is positive to note, based on Brazil’s confirmation, that no major deficiencies were identified in the identification of beneficial owners, further actions are necessary to address the recommendation. There is still no evidence that the methodology for identifying beneficial owners has been clarified by any legal amendment or binding guidance applicable to all banks. Furthermore, as the supervisory actions reported to date were carried out within the framework of the common reporting standard, their scope is limited, focusing only on certain types of account holders. While Brazil has confirmed that the methodology applied in these cases aligns with the standard, this remains targeted towards compliance with the Common Reporting Standard and does not necessarily reflect the broader banking institution practice. Brazil should report further progress in its next self-assessment.
Status determined	In the process of being addressed.
Actions required	In its next self-assessment, Brazil should – Report actions taken to address the legal gaps identified in the 2018 Report regarding the methodology for identifying beneficial owners of bank account holders (lack of clarity) to ensure it is in line with the standard.

Element B.1: Access to information

5. Monitoring application of attorney-client privilege

 

Recommendation (B.1, framework)	Brazil should continue to monitor the application of the scope of the attorney-client privilege in practice to ensure consistency with the standard and that it does not unduly limit EOI.
Underlying factor	There are some uncertainties as to whether the attorney-client privilege may unduly limit access to information acquired by attorneys. (see paragraphs 146 to 148 in the Brazil’s 2018 Report for more information).
Summary of actions reported	Brazil has been monitoring that attorney-client privilege does not interfere with the effective exchange of information. In practice, Brazil has not yet faced the need to obtain information from a lawyer, either for domestic or EOIR purposes. No challenges to EOIR have arisen in this regard.
Conclusion	Seven years have passed since the adoption of Brazil’s latest EOIR report and Brazil has not identified any case where professional secrecy has prevented access to information, nor has any peer raised such a concern. At the time of the 2018 Report, representatives of the Brazilian Bar Association had confirmed that attorney-client privilege does not unduly impede the tax authorities’ investigative procedures. Moreover, lawyers are not usually a source of information for tax purposes and Brazil has not yet faced the need to obtain information from a lawyer, either for domestic or EOIR purposes. This reflects that this issue is unlikely to affect EOIR in practice. Therefore, although Brazil has not reported detailed information on the monitoring carried out to ensure that attorney-client privilege does not interfere with the effective exchange of information, this recommendation can be considered as no longer sufficiently material. Brazil is no longer required to report, in application of paragraph 61 of the enhanced monitoring methodology.
Status determined	No longer sufficiently material
Actions required	No immediate action required.

Element B.2: Notification and appeals

6. Prior notification procedure

 

Recommendation (B.2, framework)	Brazil should either explicitly clarify the possibility of judicial waiver of the prior notification procedure or introduce explicit exceptions in its legal framework. Brazil should also closely monitor that the procedure does not frustrate the provision of information held by financial institutions without prior notification of the taxpayer under investigation, where justified.
Underlying factor	Although Brazil provides assurances that it may obtain judicial waiver of the prior notification procedure in respect of accessing information held by financial institutions in very urgent or sensitive cases, there is no explicit exception to such procedure and the obtainment of such waiver for EOI purposes has not been tested in practice. (see paragraphs 153 to 157 and 159 in the Brazil’s 2018 Report for more information).
Summary of actions reported	Brazil has been monitoring that the prior notification procedures do not interfere with the effective exchange of information. No EOIR requests have been refused or contested due to prior notification. Brazil is usually able to obtain the requested banking information directly from the Tax Administration's databases, given the comprehensive reporting obligation in place for financial institutions.
Conclusion	Brazil has made progress to address the recommendation. Brazil monitors that the procedure in place does not frustrate exchange of information. Through the reporting obligations of financial institutions, Brazil limits the number of cases in which banking information needs to be gathered from external sources. This reduces the risk of having to gather information from taxpayers first (prior summoning procedure) without an exemption being available in urgent or sensitive cases. However, the doubts expressed in the 2018 Report remain as to whether, given the uncertainty in the legal framework, a judicial waiver of the prior summoning procedure could be obtained in practice. Brazil should report further progress in its next self-assessment.
Status determined	In the process of being addressed.
Actions required	In its next self-assessment, Brazil should – Provide details on the actions taken to address the legal gaps identified in the 2018 Report regarding the lack of explicit provisions for waiver of prior notification. Provide details on the actions taken to ensure that its peers are aware of the applicable procedure and its scope so that they can assess whether a waiver is required. Provide details on the number of EOI requests received for banking information during the corresponding monitoring period and an indication of how the information was obtained (i.e. whether it was obtained entirely from internal sources or whether the concerned subject had to be notified). Provide details on the procedure for obtaining a judicial waiver to the prior notification requirement in very urgent cases for domestic purposes, including the number of cases where such a waiver was obtained, the time taken to obtain it and the outcome of the procedure.

Element C.4: Rights and safeguards

7. Monitoring application of attorney-client privilege

 

Recommendation (C.4, framework)	Brazil should continue to monitor the application of the scope of the attorney-client privilege in practice to ensure consistency with the standard and that it does not unduly limit EOI.
Underlying factor	There are some uncertainties as to whether the attorney-client privilege may unduly limit access to information acquired by attorneys (see paragraphs 146 to 148 and 195 to 196 in the Brazil’s 2018 Report for more information).
Summary of actions reported	Brazil has been monitoring that attorney-client privilege does not interfere with the effective exchange of information. In practice, Brazil has not yet faced the need to obtain information from a lawyer, either for domestic or EOIR purposes. No challenges to EOIR have arisen in this regard.
Conclusion	Seven years have passed since the adoption of Brazil’s latest EOIR report and Brazil has not identified any case where professional secrecy has prevented access to information, nor has any peer raised such a concern. At the time of the 2018 Report, representatives of the Brazilian Bar Association had confirmed that attorney-client privilege does not unduly impede the tax authorities’ investigative procedures. Moreover, lawyers are not usually a source of information for tax purposes and Brazil has not yet faced the need to obtain information from a lawyer, either for domestic or EOIR purposes. This reflects that this issue is unlikely to affect EOIR in practice. Therefore, although Brazil has not reported detailed information on the monitoring carried out to ensure that attorney-client privilege does not interfere with the effective exchange of information, this recommendation can be considered as no longer sufficiently material. Brazil is no longer required to report, in application of paragraph 61 of the enhanced monitoring methodology.
Status determined	No longer sufficiently material
Actions required	No immediate action required.

Element C.5: Effective exchange of information

8. Timeliness of responses to EOIR requests

 

Recommendation (C.5, practice)	Brazil should ensure that it can respond to all types of information requests in a timely manner, with due priority given to EOI requests by all areas of the RFB [Tax Administration] responsible for obtaining and providing the information.
Underlying factor	Although Brazil has made significant progress in response times over the three-year period, in many instances the competent authority has been unable to answer incoming requests in a timely manner due to delays at the level of the RFB’s [Tax Administration’s] compliance areas caused by workplace relations and staffing issues. Many requests were responded to or remain outstanding after more than one year. (see paragraphs 205 to 207 in the Brazil’s 2018 Report for more information).
Summary of actions reported	Brazil has improved the timeliness of responses, with a significant increase in the proportion of requests answered within 180 days (from 62% at the time of the 2018 Report to 83% of the requests over the monitoring period). Brazil has taken several measures to achieve this objective, including improving the functionalities of the system used to control requests; improving the efficiency of interactions with the units responsible for providing responses in order to reduce internal workflows; and implementing regulatory changes aimed at reducing the time required to obtain information from third parties, including banking information.
Conclusion	Brazil has made progress to address the recommendation. The timeliness of responses has significantly improved and is overall good. While nothing suggests that delays at the level of the Tax Administration have affected timeliness, the EOI Unit has recently undergone some administrative and organisational changes, as reported by Brazil under recommendation 9 (see below). In this context, it remains unclear to what extent the shortcomings identified in the 2018 Report regarding difficulties at the level of Tax Administration have been fully addressed or whether the recent administrative and organisational changes may pose a challenge to timely responses to EOIR requests. It should report further progress in its next self-assessment.
Status determined	In the process of being addressed.
Actions required	In its next self-assessment, Brazil should – Provide updated timeliness statistics for the corresponding monitoring period. Provide further details on the actions taken to ensure that the recent administrative and organisational changes do not pose a challenge to timely responses to EOIR requests.

9. Lack of status updates

 

Recommendation (C.5, practice)	Brazil should monitor the effectiveness of its new internal procedure and ensure it provides status updates to EOI partners within 90 days in those cases where it is not possible to provide a complete response within that timeframe.
Underlying factor	Brazil did not always provide an update or status report to its EOI partners within 90 days in the event that it was unable to provide a substantive response within that time. (see paragraphs 208 and 209 in the Brazil’s 2018 Report for more information).
Summary of actions reported	During the monitoring period, Brazil provided status updates in 51% of the cases where it was unable to provide a response within 90 days. In previous years (i.e. 2021-2022), Brazil was able to provide status updates for all requests that were not answered within 90 days. The decrease during the monitoring period was due to some administrative/organisational changes in the EOI unit, which have already been addressed, following which Brazil noted an improvement in the provision of status updates in the second half of 2024.
Conclusion	Brazil has made progress to address the recommendation. It should report further progress in its next self-assessment.
Status determined	In the process of being addressed
Actions required	In its next self-assessment, Brazil should – Report on the measures taken to improve the provision of status updates, together with any other relevant information for analysing the statistics corresponding to the provision of status updates during the next monitoring period.

EOIR experience

Over the monitoring period, Brazil received 216 requests and sent 44 requests. Argentina, Belgium and Spain were the top three EOIR partners in respect of incoming requests. Switzerland, the United Sates and Andorra were the key partners in respect of outgoing requests. Brazil reported providing full and final responses in 98% of all the received requests and indicated 1% as pending requests. The remaining 1% corresponds to requests withdrawn by the requesting jurisdictions.

Eight members provided peer input. Peers reported being generally satisfied in respect of their EOIR experience with Brazil.

New developments having a bearing on the EOIR standard

No recent developments that could have a bearing on the EOIR standard (other than those reported to address recommendations) have been reported by Brazil or have otherwise come to light.

Next steps

Brazil should continue taking actions towards implementing the standard effectively.

The following next steps are expected from Brazil:

• Submit its next self-assessment report in 2028 under the second round of enhanced monitoring.

• See also Chapter 1 (Scope and methodology), section on “PRMG decisions – Statuses determined and actions required”, which explains the next steps expected on recommendations that are “no longer sufficiently material”.

Views/response of the monitored jurisdiction

Brazil encourages and promotes transparency and the exchange of information for tax purposes. The Brazilian government continues to take decisive action to strengthen and enhance the enforcement and scope of existing domestic tax laws, counter multinational tax avoidance, and foster tax transparency.

Brazil supports the role of the Global Forum and its Peer Review and Monitoring processes in assisting and assessing jurisdictions. We appreciate the diligent work undertaken by the Global Forum in conducting the Brazil’s Enhanced Monitoring in accordance with its Methodology.

The Enhanced Monitoring process and its report have a great importance, reflecting the results of a constructive and transparent engagement. We value the clarity of the analysis and conclusions, which acknowledge the significant progress achieved in several areas since the EOIR Peer Review 2018 report.

Brazil is particularly pleased to note that the two recommendations concerning attorney-client privilege (Elements B.1 and C.4) have been deemed "no longer sufficiently material", confirming that this issue does not unduly affect at all our Exchange of Information on Request (EOIR) process in practice. Brazil is also proud about the progress made related to the availability of ownership information (Element A.1) and the timeliness of responses to EOI requests. The reduction in processing time is yielding concrete results, with 83% of requests now answered within 180 days — a direct testament to our commitment to effective information exchange.

Brazil remains an active and dedicated member of the Global Forum and will continue to work hard to achieve full compliance and effectiveness in the implementation of the remaining recommendations and with all the international standards on transparency and exchange of information for tax purposes.

Brazil fully endorses the results of its Enhanced Monitoring process and is of the view that the evaluation reflects the jurisdiction’s efforts to comply with the international standards of transparency and exchange of information. We are confident that such efforts will continue to be reflected in the next Enhanced Monitoring Brazil’s process.

Note

← 1.  OECD (2018), Global Forum on Transparency and Exchange of Information for Tax Purposes: Brazil 2018 (Second Round): Peer Review Report on the Exchange of Information on Request, Global Forum on Transparency and Exchange of Information for Tax Purposes, OECD Publishing, Paris, https://doi.org/10.1787/9789264306103-en.