Superior Tribunal de Justiça issues rulings on taxation and fracking

The Superior Tribunal de Justiça (STJ) in Brazil is addressing several significant legal matters. In a recent jurisprudence update, the First Panel ruled that capital gains obtained by Real Estate Investment Funds (FII) through the sale or redemption of shares in other FIIs, known as Funds of Funds (FOF), are subject to Income Tax (IR).

Additionally, the STJ is implementing new procedures for virtual sessions to analyze appeals against presidential decisions regarding case admissibility. These sessions aim to determine whether such decisions should be upheld or if the cases should be redistributed for individual analysis.

Furthermore, the First Section of the STJ is set to resume the judgment of an Incident of Assumption of Competence (IAC) regarding the use of hydraulic fracturing, or fracking, in Brazil. The court will decide if the technique can be used for unconventional oil and gas exploration and establish the necessary conditions for such activities, following legal disputes involving the National Agency of Petroleum, Natural Gas and Biofuels (ANP) and Petrobras.