New Decree Alters Rules of Federal Procedure for Investigating Environmental Violations and Sanctions – with Several Revocations

On January 2, 2023, the first business day of the new Brazilian government, the federal government published Decree No. 11,373/2023 and made substantial changes to Decree No. 6,514/2008, which provides for infractions and administrative sanctions related to the environment and established a federal procedure for investigating these infractions. In summary, the new decree reestablishes rules of Decree No. 6,514/2008 and repeals provisions that instituted new procedures for the sanctioning administrative process.

Related to sanctioning, the new decree repeals deadlines that were established for the agents who carried out the assessment for preparing technical opinions in the instruction and trial phase of the processes. In addition, the percentage of the fines collected by the federal government that shall be reverted to the National Environmental Fund – FNMA increased from 20% to 50%.

Related to reestablishing original rules, one of the most significant changes of Decree No. 11,373/2023 is the elimination of the conciliation hearing stage—by means of repealing Articles 97-A, 98-A, 98-B, 98-C and 98-D. Thus, the deadline for presenting administrative defense (20 days) is no longer interrupted by the holding of a conciliation hearing. The defendant shall (i) present a defense or objection within 20 days or (ii) pay the fine with a discount, either in installments or converted into environmental services.

Regarding cases in which fines are converted into environmental services, the discounts are now as follows:

• In cases of direct conversion (when the developer is responsible for carrying out the service project): 40% if the application is filed before the presentation of an administrative defense or 35% if the application is filed before the presentation of closing arguments;
• In cases of indirect conversion (when the developer deposits the conversion amount): 60% if the application is filed before the presentation of an administrative defense or 50% if the application is made until presenting closing arguments.

In this context, there is no longer a provision establishing a discount for conversion of the fine into environmental services if the process reaches the administrative authority of appeals.

Decree No. 11,373/2023 is already in force, assuring the applicability of former rules to the defendant who requested the conversion of the fine into environmental services, which was a provision of the previous legal regime.