Brazil’s Federal Revenue Service (RFB) announced a public consultation on draft guidelines for transfer pricing regulations for intragroup services and unilateral advance pricing agreements under Brazil’s new transfer pricing regime on 29 August 2024.

The consultation is set to conclude on 30 September 2024.

Brazil’s new transfer pricing regime was initially introduced by Provisional Measure No. 1.152 on 28 December 2022, and later enacted into law by Law No. 14.596 on June 14, 2023. The Normative Instruction RFB No. 2161, issued on 28 September 2023, provides the regulatory framework for this regime.

While the new system becomes mandatory in 2024, taxpayers have the option to adopt it in 2023.

The consultation consists of two parts:

The first amends Chapter III of Normative Instruction RFB No. 2161, adding a new Section VI on intragroup services under OECD guidelines. It’s assumed to apply after finalisation and publication, with no specific effective date mentioned.

The second part is for the new guidelines that cover unilateral advance pricing agreements (APAs) procedures, including rules for APA requests, proposals, analysis, conclusion rules, formalisation, and monitoring.

APAs are valid up to four years and extendable for two more. Taxpayers can request an APA if they engage in transactions under transfer pricing rules and participate in the cooperative tax compliance programme for at least six months.

The RFB may establish a yearly limit on the number of APA proposals it will analyse, based on its operational capacity.

The proposed regulations for APAs are set to take effect on 1 January 2025.