Law 10,052, which institutes the Telecommunications Technological Development Fund (FUNTTEL), was published in the Official Gazette on November 29 2000. According to Article 1 the fund's objective is to develop the domestic telecommunications industry.
The fund will be administered by a management council, with the National Economic and Social Development Bank (BNDES) and the Study and Project Financing Company (FINEP) as its financial agents.
Article 4 states that the fund's revenues are comprised of:
- a contribution of 0.5% of the gross revenue of telecommunication service provider companies, under the public and private systems;
- a contribution of 1% due by institutions authorized pursuant to the law, on the gross collections of participative events realized through telephone calls; and
- certain other resources.
The 1% contribution mentioned was instituted by Law 9,998 of 2000, which created the Universal Service Access Fund (FUST). Initially, capital was derived through the transfer of R$100 million from FISTEL, ANATEL's inspection fee created by Law 9,472 of 1998.Law 9,998 of 2000, which created the Universal Service Access Fund, established the 1% contribution. Initially, capital was derived through the transfer of R$100 million from FISTEL, ANATEL's inspection fee created by Law 9,472 of 1998.
Both the Telecommunications Technological Development Fund and the Universal Access Fund contributions are social contributions regulated by Article 149 of the Constitution. In accordance with this provision, such contributions can only be created through supplemental law, which may be challenged in the future.
Moreover, the intervention of economic domain contributions can only be exacted 90 days after publication of the law that institutes them. In this aspect, FUNTTEL abided by the constitutional rule, considering that article 9 of Law 10,052/00 determines that the law takes effect 120 days after its publication, that is, the collection of this contribution (in prinicple) will commence at the end of March 2001.
The Telecommunications Technological Development Fund resources will be invested exclusively in the interests of the telecommunications sector, and from August 1 2001 20% of the resources will be transferred directly to the CPQd (Telecommunications Research and Development Centre) Foundation. From August 1 2002 the management council may alter the percentage to be allocated, in accordance with the foundation's research and development resource needs.
In addition to the resources transferred to the CPQd Foundation not being reimbursable, they shall be subject to an annual report for the examination of the management council.
President Fernando Henrique Cardoso sanctioned Law 10,052 of 2000 with the following vetoes:
- Item 2 of Article 4 defines that the Telecommunications Technological Development Fund may derive resources from FISTEL, being a fee pursuant to the exercise of ANATEL's supervisory powers;
- Section 5 of Article 6 determines that the Telecommunications Technological Development Fund resources would be collected by BNDES and FINEP, when these collection agents do not have the means to collect and distribute these monies;
- Article 5 adapts the allocation of FISTEL resources, but was adversely affected with the veto opposed to Item 2 of Article 4; and
- Section 7 of Article 6 determines that the recipients of telecommunications service bills shall transfer the resources on the date that credits are made for providers, by virtue of the high cost of inspection.
The proposed Telecommunications Technological Development Fund Regulation Decree was published in the Official Gazette on December 5 2000 by the Communications Ministry. The decree will take effect on March 28 2001.
The regulation determines that both the telecommunications service provider companies and authorized institutions that promote phone-in competitions shall render accounts to ANATEL in order for the fund's management council to evaluate contributions. ANATEL may conduct audits on companies in order to check whether regulations are being complied with.
The regulation exempts the amounts transferred from one company to another when there has already been a collection of the contribution. However, the fine for non-payment of the Telecommunications Technological Development Fund is equal to that for non-payment of the access fund: 3% on the amount due, plus 1% interest per month of default. Also included in the regulation are the provisions for the Telecommunications Technological Development Fund investment plan and a definition of the investment of the fund's resources.
The term of office for members of the management council will be three years, with the possibility of renewal. However, the first councillors will have a term of office of two to three years, to be confirmed upon individual appointment. Council meetings will be held quarterly. The president will indicate the name of his substitute, who shall be submitted to the approval of the council. Decisions will be by absolute majority and the president has the casting vote. The council will have the administrative support of the Communications Ministry, from which it will be able to request employees. It will also be responsible for establishing the rules relating to the adequate operation of the Telecommunications Technological Development Fund.
For further information on this topic please contact Ricardo Barretto or Bruno Girão Borgneth at Barretto Ferreira, Kujawski, Brancher e Gonçalves – Sociedade de Advogados by telephone (+55 11 3066 5999) or by fax (+55 11 3167 4735) or by e-mail ([email protected] or [email protected]).
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