At the end of 2021, a change in legislation was published to modernize one of the most backward sectors of national finance, the regulation of transactions with currencies other than the real. Already dubbed the “new exchange rate framework”, the change reduces bureaucracy in the entry and exit of resources from the country, in addition to eliminating several obstacles to the transfer of resources. “This new exchange rate framework removes all the previous debris left by the rules that have accumulated since 1924,” said the founding partner of Tendências Consultoria, Nathan Blanche, one of the country’s leading exchange experts.
The main change for individuals is the raising of the resource limit on international travel. Previously, travelers could only carry (or bring) R$10,000 in their luggage, the equivalent of US$1,800. The new limit is US$ 10,000, or R$ 55,300 at the exchange rate on Wednesday (12). Another facility is that individuals will be able to buy and sell up to US$ 500 in cash in any foreign currency.
“The new exchange rate mark removes all the previous rubble left by the rules that have accumulated since 1924” Nathan Blanche founding partner of Tendências consultancy.
International investors will also be able to open dollar accounts in the country. The end of this barrier represents a relief for expatriates who had to come to terms with the Byzantine rules of the banking system. It should also open the way for smaller international investors to place their bets here.
There have been changes for companies as well. Exporting companies, which receive in dollars or other currencies, are no longer obliged to convert these revenues into reais. Now, they will be able to have checking accounts and pay bills directly. Banks and financial institutions, on the other hand, gained the freedom to raise funds in reais and then invest them abroad. All duly justified before the Central Bank (BC).
RESTRICTIONS The difficulties of the previous legislation had their justification. For most of the last century, Brazil suffered from a shortage of hard currencies to pay for its imports. The few dollars that came in had to be used to buy oil and essentials. Thus, it was necessary to make it difficult to leave. The situation changed a few years ago, but the legislation has not been updated. According to Renata Cardoso, lawyer and specialist in banking law at Lefosse law firm, in the 2000s there was even an attempt to reform, which did not advance. “The new standard is broader and will allow for greater flexibility,” he said.
Although sanctioned and already published, the new law will only come into effect effectively in one year. In the meantime, it will be up to the BC to define how the changes will work in practice. Under the new exchange rate framework, some attributions of the National Monetary Council (CMN) will be transferred to the BC. Among them, the regulation of foreign exchange operations, dollar futures contracts and the organization and supervision of brokers that trade in currencies. “The market will be more fluid and faster, more in line with international standards,” said Renata. “The lack of flexibility complicated the lives of multinationals, who could not make private credit clearing or make payments in foreign currency on national territory.” The new rule defines that the BC will have all information on the flow of dollars in the country recorded electronically. For Blanch, from Tendências, the old rule has become anachronistic within the current global reality and should have already changed. “This update leaves everything to the BC, which understands the matter,” he said.
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