The Brazilian Senate approved on Tuesday the draft regulation of cryptocurrencies in Brazil. The proposal now goes to the country’s Chamber of Deputies and, if approved, will need the signature of President Jair Bolsonaro and the approval of the Executive authorities to be implemented.
The approved proposal was the replacement of Senator Irajá (PSD-TO), which brings together the original project of Senator Flávio Arns (Podemos-PR), and the suggestions of two other senators Soraya Thronicke (PSL-MS) and Styvenson Valentim (Podemos-RN).
The bill under discussion in the Senate submits businessmen and companies that trade such assets to protection laws against money laundering, crimes against the financial system, and consumer protection. According to the bill, individuals and companies would also have to identify and report suspicious operations to the country’s Financial Activities Control Council (Coaf). In addition, companies in the sector (mainly exchanges) would be considered financial institutions, having to undergo some adjustments.
The rules proposed by Congress will add to and extend those already in force, such as Normative Instruction 1,888/2019, from the Federal Revenue Service, which established the obligation to declare crypto-assets in the Income Tax. In 2021, the scope of the obligation was expanded to encompass NFTs and other crypto assets.
At first, however, if and when approved, the new law will not change much in the lives of investors and companies that already operate in Brazil because, in general, such companies already adopt proposed governance, compliance, and transparency guidelines. In the project.
The change will come in a second moment, with the regulation by the Executive. It will be when definitions such as the authorization procedure for new companies in the segment and the requirements to be adopted for the continuity of the operations of the existing ones will be defined in greater detail. For companies in operation, the PL provides for a grace period of at least six months to carry out the adjustments.
The regulation also provides that the inspection of the sector will fall on entities such as the Central Bank, the Federal Revenue Service, and the CVM (the Brazilian SEC). In meetings and public hearings, these entities assured that they had the operational capacity for this demand and were prepared to fulfill it.