Ordinance MF N. 427/2013 was published on August 2, 2013, in accordance with Section 22 of Law N. 9.430/1996, and defines the spread margin to be added to the interest calculation based on the rates provided by Section 22, § 6, items I to III, of such Law.

Based on said Ordinance, the spread margins to be added to the interest calculation based on (i) the market rate for public federal bonds issued overseas in US dollars, whenever transactions involve US dollars with a previously fixed rate; (ii) the market rate for public federal bonds issued overseas in Brazilian reais, whenever transactions occur overseas and involve Brazilian reais with a previously fixed rate; and (iii) London Interbank Offered Rate - LIBOR for the time frame of 6 (six) months, in all other cases, are the following:

  • For purposes of deducting the maximum interest expense in transactions carried out with related parties or parties domiciled in tax havens: 3.5%, from January 1st, 2013, onwards;
  • For purposes of recognizing the minimum interest revenues in transactions carried out with related parties or parties domiciled in tax havens: 2.5%, irrespectively of the transaction, from August 3rd, 2013, onwards. From January 1st, 2013, until the publication date of Ordinance MF N. 427/2013, the spread margin for purposes of recognition of the minimum interest revenue was 0%.