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Provisory Measure 1089 – CBA Reform – Part 2

Por Lucas Bernardes.

Provisory Measure 1089 modified the requirements and processes related to authorization for foreign airlines to operate in Brazil. Please find below a summary of the changes:

  • The rules regarding the dual process to start operations in Brazil – i.e., request of authorization before ANAC to open branch followed by request for authorization to operate – will no longer apply.  Designation by the regulatory authority of the country where the foreign airline is established will no longer be required either.  The provisions of the CBA have been simplified to state only that foreign airlines will need to submit to ANAC one request for obtaining authorization to operate in Brazil and comply with other legal requirements applicable to foreign companies in Brazil.
    • NOTE: the proposed regulation does not release foreign entities which intend to operate in Brazil from obtaining previous authorization from the Federal Government and registering a subsidiary/branch with the commercial registry, since this is required by corporate law. Therefore, the dual process will still apply, with the difference that ANAC will only handle the second part of the process. This structure is compatible with the public consultation nr. 18/2021 launched by ANAC back in October of 2021.
  • The concepts and rules applicable to scheduled and non-scheduled operations have been removed from the CBA – so ANAC will now have more flexibility to regulate these matters.
  • Air carriage between points within the Brazilian territory (cabotage) is reserved to domestic airlines, incorporated under the laws of Brazil and having principal place of business and management in Brazil.

The Congress will have to ratify this legislation by the end of February (extension for another 60 days may apply), otherwise it will lose its effects. Congress can also modify any of the rules implemented by the Provisory legislation.

This article is for general informational and educational purposes.  It is not intended as and does not constitute legal advice or legal opinions and should not be used as such.  You should not act or rely upon any information provided herein without seeking the advice of a lawyer.