On 06.11.2013, the 1st Panel of 3rd Chamber of 1st Judgment Section of Federal Administrative Tax Court granted relief to the Voluntary Appeal filed by Banco GMAC S/A, recognizing the use of a tax benefit for the amortization of goodwill originated from the corporate restructuring of GM Group.

Tax authorities claimed that the GM Group had used a vehicle company and that the corporate operations lacked business purpose, so the goodwill was created inside the group by an inverted merger.  

On the other hand, the assessed company sustained that the restructuring of the GM Group should be interpreted within a global context of segregation of automotive and financial activities, which had also been discussed among the controlling companies of GM Group located abroad. Furthermore, due to exchange rules in force at the time of the events, considered along with the scenario of decrease of value of the Real facing U.S. Dollars, the GM Group sustains that the restructuring could not have been performed otherwise, or this would result in a significant decrease of the registered direct foreign investment (RDE-IED) before the Central Bank.

The CARF recognized the goodwill and the corporate restructuring based on two main arguments: (i) inexistence in the tax legislation of any obstacle to “internal goodwill”; but only to operations carried out with “sham” or “abuse of right”, and the attitude of the GM Group could not be considered as a sham or abuse; and (ii) the disallowance of goodwill based only on the argument that the taxpayer performed a corporate restructuring under the least onerous conditions from a tax standpoint is not valid. This decision may still be appealed to the Superior Administrative Court.