Alexandre R Chequer

Following months of discussion, and meeting the expectations of various industry segments, Brazil's House of Representatives passed Bill of Law No. 2,308/2023 on July 11, 2024. This legislation establishes the National Policy for Low-Carbon Hydrogen and is now awaiting presidential sanction. Once enacted, this new legal framework will provide greater predictability for investments in low-carbon hydrogen projects in Brazil, enabling progress in the energy transition. In addition to complementing the objectives of the National Energy Policy, it introduces innovative governance, planning, regulation, and fiscal and non-fiscal incentives. Here you find our client alert with a few insights on what may might expect us going forward, written with my fellow partners Marcos Ludwig and Andre Carvalho #veirano #energytransition #greenhydrogen #greencommodities https://lnkd.in/daZPK_eQ

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On McDermott Will & Emery’s first day in the Blue Zone of COP29, US Climate Envoy John Podesta said the fight against climate change will not stop under President-elect Donald Trump’s next term. In our latest piece, my colleague, Shah Jahan Khandokar, and I summarize Podesta’s key insights shared during day one of the conference. In brief: 1. “Although under Donald Trump’s leadership the US federal government placed climate-related actions on the back burner, efforts to prevent climate change remain a commitment in the US and will confidently continue,” Podesta said. 2. Trump has pledged to deregulate the energy sector and pull the United States from the Paris Agreement. However, Podesta said, “This is not the end of our fight for a cleaner, safer planet.” 3. Under US President Joe Biden, the Inflation Reduction Act of 2022 was passed, the largest downpayment on the green transition seen in US history. 4. “The fight is bigger than one election, one political cycle in one country,” said Podesta. COP29 represents a “critical opportunity to cement our progress.” 5. Among the US’s top goals for upcoming climate talks is securing mitigation plans for greenhouse gases other than CO2, such as methane. On November 12, the US will co-host a summit on the issue with China and COP29 host Azerbaijan. 6. According to Podesta, other major priorities will be reaching an agreement on the use of carbon trading and increasing ambition on clean energy deployment. 7. Another crucial component of the climate talks, Podesta said, will be ensuring small economies have access to climate finance from rich nations. 8. “COP29 is a crucial opportunity to solidify our progress and keep 1.5 degrees alive, accelerate progress in reducing all greenhouse gases, and perhaps most importantly, strengthen global cooperation in adaptation and climate finance,” said Podesta. “We are here to work, and we are committed to achieving a successful outcome at COP29.” 9. At the end of the first day, diplomats have greenlit key rules that govern the trade of “carbon credits,” breaking a yearslong deadlock over contentious carbon markets. It means a global “carbon market” can now been established, allowing richer nations to pay for projects in developing nations that reduce emissions and to meet their climate obligations. Initial projections estimate that this could be worth up to $250 billion of funding for projects in emerging and developing economies. https://lnkd.in/emRsiCqA

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InterCement Restructuring Plan Tension; J&J Questions Talc Committee. Read the daily bankruptcy briefing. https://lnkd.in/eNB7piQF #InterCement #Brazil #restructuring #bankruptcy $JNJ #talc #distress

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Read on our Brazilian Competition Case Law & Trends report: • Petrobras gets CADE approval for new settlement and retains five refineries • CADE clarifies merger notification rules for investment funds • CADE debates new parameters to calculate gun jumping fines • CADE’s Tribunal blocks transaction in the drywall market • Tiremaker and resellers found not guilty in price-fixing investigation • CADE acknowledges the lawfulness of a joint negotiation agreement between competitors and suppliers in the construction market • CADE’s Tribunal reviews cease and desist agreements related to Operation Car Wash • CADE publishes new guidelines on vertical and conglomerate merger reviews and trustees’ activities • Updates in Commercial Defense • 9 trade defense measures will expire in the 2nd semester of 2024 Know more about each of the topics above at our website: https://lnkd.in/dahXsFBb

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Brazil Enacts “Fuel of the Future” Law Brazil adopted a broad, progessive law last week (Law 14.993/2024) that sets up incentive programs for several different biofuels and the regulatory regimes for sustainable aviation fuel (SAF), biomethane, carbon capture, and biorefining. One of the first tangible results will be the change to Brazil’s ethanol/gasoline blend known as “flex fuel” – going from 18 – 27.5% ethanol to 22 – 35%. Biodiesel, blended with traditional diesel, would go up one percent a year starting next year and reach 20% by 2030. Some of the other highlights of the new law include: Biomethane Program The full name - National Program for Decarbonizing Natural Gas Producers and Importers and for Incentives for Biomethane – provides more of the details. The goal here is to produce fuel from the country’s vast agricultural wastes. The aim is to encourage research, production, marketing and the use of biomethane in Brazilian energy to decarbonize the natural gas sector. As part of the plan, the government would set a mandatory annual target for reducing GHG emissions in the natural gas market. These targets must be met by natural gas producers and importers, based on the inclusion of biomethane in natural gas consumption. To meet the target, natural gas producers and importers will be able to buy or use biomethane in their activities or puchase Biomethane Origin Guarantee Certificate (CGOB). The CGOB will be a traceability certificate based on the volume of biomethane produced and marketed by the biofuel producer, issued by an certifying agent accredited by the government, which attests to the characteristics of the production process and which must include at least the origin of the input for biomethane production and the production location. National Sustainable Aviation Fuel Program As of 2027, airline operators will need to reduce greenhouse gas emissions on domestic flights through the use of sustainable aviation fuel (SAF). The targets start at a 1% reduction and will gradually increase to 10% by 2037. National Green Diesel Program The National Energy Policy Council will set the minimum amount, in volume, of green diesel to be added to fossil diesel each year. Brazil-watchers know that the country has already proven itself capable of real innovation. In its history, it has taken its vast sugar-cane production and turned it into ethanol to mix with gasoline in its very successful “flex fuel” programs. It’s new plans seem equally ambitious. L*nk to new Law: https://lnkd.in/ggPAT2Bk #fuels #fuel #energy #energyindustry #methane #ghg #climatechange #cleanenergy #ethanol #energytransition #sustainability #sustainableairlinefuel #latinamerica #brazil #melonlatam

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This legal victory for Petrobras marks a crucial step forward for Colombia’s energy security, sovereignty, and the fight against energy poverty. A powerful example of progress for the #EnergySector! #EnergySecurity #Petrobras #EnergyForAll #Colombia

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➡ Highlights on the Brazilian Legal Framework for Green Hydrogen ✔ Last night (July 11th), the BR Lower House approved Senate amendments to Bill 2,308/23, marking a significant stride in regulating Brazil's low-carbon hydrogen (“Green Hydrogen”) production. ✔ This Bill introduced voluntary certification and federal tax incentives, reshaping the landscape for international investors interested in the Brazilian hydrogen sector. ✔ Key changes include adjusting the cap for carbon dioxide emissions per kilogram of hydrogen produced from energy sources. Initially proposed at 4 kg CO2eq/KgH2 by the BR Lower House, the BR Senate has revised this proposal to 7 kg CO2eq/KgH2, accommodating a broader range of production methods and technological routes. ✔ Additionally, the amendments remove the requirement for a maximum export percentage for companies seeking tax benefits, offering greater flexibility in market participation. The amendments also set a cap on fiscal subsidies for hydrogen production and commercialization, encouraging a balanced approach between economic support and environmental sustainability. ✔ Biofuels are now included alongside fossil fuels as viable sources for hydrogen production, emphasizing pathways with lower carbon emissions and the Brazilian expertise in the ethanol industry. ✔ Authorization by ANP: The activities related to the production of low-carbon hydrogen and other associated activities, such as processing, treatment, import, export, storage, warehousing, packaging, transportation, transfer, resale, and commercialization, will require authorization issued by the BR Agency of Petroleum, Natural Gas, and Biofuels (ANP). Companies that produce hydrogen will have priority in the processing of authorization requests for other activities. ✔ Certification under the Brazilian Hydrogen Certification System (SBCH2) will be voluntary but should be rigorous to verify greenhouse gas emissions during production. ✔ Moreover, the legislation introduces robust tax incentives for low-carbon hydrogen producers and extends existing benefits to machinery and equipment utilized in hydrogen projects. A substantial fiscal credit amounting to BRL 18.3 billion (approximately USD 3.35 billion) will be disbursed from 2028 to 2032 to Rehidro beneficiaries, prioritizing projects that minimize greenhouse gas emissions and foster national value chain development. ✔ We understand that this Bill reflects Brazil's commitment to advancing sustainable energy solutions and creating a conducive environment for investment in the hydrogen sector. For international investors, this regulatory framework offers clear incentives and opportunities to participate in Brazil's transition towards a greener economy. Note: the final step in the Brazilian legislative process is the presidential approval, which is expected to be completed within the next few days. #energytransition #hydrogen #greenhydrogen #investmentsinbrazil

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Last week me and Renata Amaral talked to Forward Law Review about the Brazilian ETS (SBCE, in Portuguese). Below some of our comments: “The cap-and-trade format is very similar to the European model and the interoperability with the voluntary market is also observed in California, for example.” “Many aspects remain to be regulated, such as the definition of regulated sources and installations, the percentages of voluntary market credits that will be allowed and accepted methodologies.” “The regulated market is expected to be implemented in six to eight years, but it is important to emphasise that many actions will take place before then.“

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Innovations of Law 15,042 in the Brazilian Carbon Market The recent promulgation of Law No. 15,042 of December 11, 2024, marks a significant milestone for Brazil in its efforts to mitigate climate change. This legislation creates the Brazilian Greenhouse Gas Emissions Trading System (SBCE), establishing a robust and transparent market for trading carbon credits. Below, we explore the main aspects and innovations introduced by this law. Creation of the SBCE Law 15,042's primary objective is to regulate the trade of greenhouse gas emissions. The SBCE sets clear limits for CO2 and other gas emissions, encouraging companies to reduce their carbon footprints. Companies that cannot meet these limits can buy carbon credits from those exceeding their reduction targets. Verified Emission Reduction or Removal Certificates (CRVEs) The Verified Emission Reduction or Removal Certificates (CRVEs) is a central law innovation. These certificates represent the reduction or removal of one ton of CO2 equivalent. CRVEs can be traded in the market, allowing companies to purchase certificates to offset emissions. Incentives for Emission Reduction The law introduces financial incentives for companies that manage to reduce their emissions. By generating CRVEs, these companies can sell them in the market, creating a new revenue source. This stimulates innovation and the adoption of more sustainable practices. Regulation of the Carbon Credit Market The carbon credit market is divided into two segments: regulated and voluntary. Companies must meet emission targets in the regulated sector, while in the voluntary sector, they can purchase carbon credits to improve their sustainability practices. This division promotes both mandatory and voluntary decarbonization. REDD+ Projects Law 15,042 also recognizes the importance of Reducing Emissions from Deforestation and Forest Degradation (REDD+) projects. These projects aim to reduce CO2 emissions caused by deforestation and forest degradation while increasing carbon stocks in native vegetation. Credits generated by REDD+ projects can also be traded in the SBCE. Conclusion Law 15,042 brings essential innovations to the Brazilian carbon market, promoting a greener and more sustainable economy. By regulating emissions trading and introducing incentives for carbon reduction, Brazil takes a significant step towards meeting its climate goals. This legislation encourages more responsible business practices and creates economic opportunities by selling carbon credits. Thus, the law represents a balanced and progressive approach to addressing climate change challenges and promoting environmental sustainability in Brazil.

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We have just published the alert below for those monitoring hydrogen-related developments. Yesterday (September 4), Brazilian Congress concluded the approval of Bill of Law No. 3,027/2024, which introduces a significant complement to the National Policy of Low-Carbon Hydrogen (LCH2) that both public and private sectors were waiting for. The so-called "LCH2 Development Program" (PHBC) contemplates the concession of tax credits (CSLL) for a five-year period starting on January 1, 2028 subject to competitive proceeding - a relevant addition to the incentives package that Law No. 14,948/2024 introduced on August 2. The matter will be submitted to presidential sanction. A fast approval without vetoes is expected. For more information, check out the alert published on Veirano Advogados' website: https://lnkd.in/duPj5FmU Let us know if you want to discuss. #h2 #hydrogen #greenh2 #lowcarbonhydrogen #energytransition

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Insightful report by the World Economic Forum. Poses the question of whether the future behavior of critical minerals markets is possible to predict. All of the variables that affect supply and demand interact in ways that are so complex that no forecasting system can plausibly predict them. #criticalminerals #energytransition

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👏 👏Big thanks to the #Brazilian_Ministry_of_Finance and Banco Interamericano de Desarrollo #IDB for inviting me to speak at the event on “delivering cross-border infrastructure” last 4th April in Brasilia. Muito obrigado 🇧🇷🇧🇷!!!! 📣In December 2023, 🇧🇷Brazil took over the Presidency of the #G20 and therefore they are promoting an intense agenda of meetings and events to strengthen #global #architecture and #governance on all major international economic issues. 👉See more about the #G20 at: https://www.g20.org/es ✅In this context, I had the privilege of joining a discussion panel organized by the Infrastructure Working Group #IWG with Vanessa Carvalho dos Santos and Salah Koleilat, under the brilliant moderation of Tomas Serebrisky ✅A wonderful opportunity to #learn a lot about #cross_border infrastructures in different sectors and parts of the Globe but also to share with the audience three fundamental messages: 1️⃣ The European Single Day-Ahead Coupling & Intraday Couplings #SDAC & #SIDC are the largest electricity wholesale market integration project worldwide🌎. The electricity annual volume managed by our EU SDAC is equivalent to PJM’s, MISO’s and CAISO’s all together. 2️⃣ The #Multilateral and #Decentralized #governance by #NEMOs All NEMO Committee together with a strong cooperation scheme have allowed the European Commission, EU Agency for the Cooperation of Energy Regulators (ACER) and National Regulatory Authorities #NRAs to materialize this #TOP1 electricity market integration worldwide. OMI - Polo Español (OMIE) is the NEMO in 🇪🇸Spain & 🇵🇹Portugal but there are other 16 #NEMOs in the #EU and we all are key pillars of this successful integration story. Check the list of NEMOs at All NEMO Committee website 3️⃣ The #EU needs massive #investments in #MoreElectricity #cross_border infrastructure to deliver the energy & climate targets. In this process, #cost_benefit analyses for new cross-border infrastructures, together with #authorization #permitting processes will need to be revolutionised to another level of efficiency if we want to see Europe evolving towards a #ClimateNeutral continent in 2050. #MoreEurope #MoreMarkets

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Brazil "REACH" and Legislative Procedure Covering foreign countries and their complex legislative and regulatory procedures is never easy - but always interesting. This past week I was collaborating on some research around open legislative questions regarding Brazil's REACH-inspired chemical management bill pending in the federal Senate. A thorny question came up about parliamentary process - and sent me digging into source documents, tapping smart local friends, and generally spending tons of time on what will essentially be a footnote somewhere. Did I regret it? Not one bit. My work is at the intersection of my expertise and my passion - law, environment, sustainability, international questions, and of course, Latin America. But knowing the languages and the culture, I am well suited to dig deep when needed to try to unwind complex questions or novel situations. I don't always get it right - but I allow myself the room to make mistakes and acknowledge and learn from them. It's not about always getting it right - to me, it's about the passionate pursuit of excellence full well knowing that it is not always attainable. As I tell all my clients, results are never guaranteed - but effort certainly is. As for Brazil "REACH," it's pending consideration by the Environment Committee in the Senate - and then moves for conclusive consideration by a third of three Senate committees. My bold prediction remains the same: Brazil "REACH" enacted in 2024. #melonlatam #latinamerica #law #statutoryinterpretation #legislative #parliamentaryprocess #internationallaw #chemical #REACH #TSCA #GHS #chemicalmanagement

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Our team, led by partner Augusto Ruiloba, supported by associates Leopoldo Melo and María Paz Delgado, represented AES Andes, Colbún, Engie Energía, and Generadora Metropolitana—Chile’s largest electricity generation companies—in the sale of securities issued by the Chilean Electricity Tariff Stabilization Fund (MPC Securities). The transaction employed a pioneering structure to monetize present and future MPC Securities for an amount of up to USD2.4 billion pursuant to Chile’s 2022 stabilization mechanism statute known as the MPC Law. Structured with an innovative USD2.4 billion A/B bond facility by IDB Invest, this transaction will help mitigate the impact on power generation companies in Chile resulting from the deferred payments established by the MPC Law. Read more about the deal here: https://lnkd.in/eQ823JVz &utm_medium=haiilo &utm_campaign=client_wins&utm_content=single_image #AOShearman

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Companies that deal with large volumes of sensitive data may benefit from having insurance in place, to help address associated legal and regulatory headaches. Read what Cristiane Manzueto at Tauil & Chequer Advogados associado a Mayer Brown has to say about recent developments in our “INDEPTH FEATURE: Cyber Security & Risk Management 2024” report: https://lnkd.in/g95rGJQd #CYBERSECURITY #CYBERRISK

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#termsheet is a widely used legal instrument in Brazil for #privatecredit, #mergersandacquisitions, #venturecapital and #capitalmarkets transactions. As it constitutes a pre-contract, Term Sheets should be given close attention by Brazilian and foreign #investors and #lenders and #companies doing business in #Brazil, as they establish expectations, rights and obligations related to the contracting parties and the underlying business. I am delighted to share the material "5 Key Clauses in CRI, CRA and Structured Credit Term Sheets that Financiers Should Pay Attention to" prepared by Feijó Lopes Advogados Structured Finance, M&A and Capital Markets team.

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Green Energy: Brazil’s Low Carbon Hydrogen Brazil continues with its progressive plans to tackle climate change. Newly-enacted Law 14.990/2024 created the Program for development of Low-Carbon Emission Hydrogen. So-called “low-carbon hydrogen” generally refers to using production methods to lower the GHG emissions either by capturing and storing carbon dioxide (“blue hydrogen”), using renewable energy for the electrolysis (“green hydrogen”), or other techniques. The new law seeks to stimulate the green energy transition by granting a tax credit on the sale of low-carbon hydrogen and its derivatives produced in the Brazil in compliance with the guidelines of this Law. The law defines the “low-carbon” hydrogen as that which is produced with emissions equal to or lower than 7 kg of CO2 equivalent per kilo of hydrogen produced. The definition of “low-carbon hydrogen” comes from Brazil’s National Policy on Low-Carbon Hydrogen enacted In August of this year in Law 14.948/2024. Brazil continues to build the regulatory scaffolding needed to support its climate ambitions. How these programs will play out in terms of real-world application is yet to be seen. Link to Law 14.990/2024 https://lnkd.in/ga2ip6xK #climatechange #hydrogen #lowcarbonhydrogen #carbon #cleanenergy #energytransition #cleantech #latinamerica #brazil #brasil #melonlatam

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For the international transactional lawyer, this change limiting the selection of Brazilian judicial forums will change the analysis undertaken in drafting cross border contracts. For example in situations involving a transaction between a US company and a Brazilian company, where one is forced to specify a Brazilian judicial forum because arbitration is not a viable option, the US company in the past often tried to mitigate the "home court" advantage of the Brazilian company by specifying a Brazilian forum different from that where the Brazilian company had its center of operations--a forum that in many instances may be recognized as more sophisticated and competent because of the sophistication of its business community. So for instance, where a US company is undertaking a transaction with a company based in Recife, the US company might require the dispute to be heard in São Paulo. With the new law, that may no longer be a viable option as an overworked court in the designated forum may try to clear its docket of any future dispute by relying on the new law to dismiss the action, even where the parties are both content on using the selected forum. At the very least, the parties selecting a forum should in the forum selection clause, specify why the selected forum has specific ties to the forum justifying its selection to try to withstand future actions based on the new law designed to alter that choice. As noted in the article, the change in law will also likely have an impact on arbitration clauses. For agreements where enforcement of an arbitration decision would require action in a Brazilian court (because, for example where the Brazilian party only has assets in Brazil), it has been common to specify arbitration on Brazilian soil--albeit in the English language using international rules. Enforcement of such arbitration decisions rendered on Brazilian soil in Brazilian courts did not require homologation (which has been abused by Brazilian parties trying to avoid enforcement), as would be the case for an arbitral decision not rendered on Brazilian soil. Now in those instances one has to take into account the requirements of the new law in designating the specific city where the arbitration should occur. The seat of arbitration can be determinative of what forum is to be used to litigate issues involving arbitral issues including enforcement of arbitral decisions.

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Tabet Advogados discusses Brazil's initiatives related to green hydrogen and biofuels. Across the Americas, we'll be hearing this month from RIELA members on an interesting aspect of the environmental law arena in their jurisdictions that is either a significant incentive toward or impediment to the energy transition.

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