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Multinational oil companies Shell, Total, Petrogal, Repsol and Equinor file a request with the Federal Court for exemption from charging the tax on the export of crude oil

Written by Ruth Rodrigues
Published 13/03/2023 às 22:56
Updated 14/03/2023 às 09:11
The oil companies Shell, Total, Petrogal, Repsol and Equinor seek exemption from charging the 9,2% tax on crude oil export activities. PRIO had already filed a request with the Federal Court, and the market is projecting new actions by national and international companies.
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The oil companies Shell, Total, Petrogal, Repsol and Equinor seek exemption from charging the 9,2% tax on crude oil export activities. PRIO had already filed a request with the Federal Court, and the market is projecting new actions by national and international companies.

The national oil and natural gas market is witnessing yet another movement of large players of the sector for tax benefits in Brazil. To the multinational oil companies Shell, Total, Petrogal, Repsol and Equinor filed a lawsuit in Federal Court requesting the suspension of the collection of tax on the export of crude oil. In addition, the Liberal Party (PL) entered the Supreme Court with a Direct Action of Unconstitutionality against the charge.

Federal Court deals with requests for actions against the collection of tax on the export of crude oil in the domestic market in the last week

The movement of the oil and natural gas sector to end the collection of the 9,2% tax on crude oil export activities in Brazil continues at full steam.

Now, the Federal Court has received a request for action for the suspension of the collection by the multinational oil companies Shell, TotalEnergies, Petrogal, Repsol and Equinor.

According to specialists in the national oil sector, other companies should follow the wave of oil companies, in addition to PRIO, which has already requested a request for legal action on the same matter.

In parallel with the request submitted to the body, the Liberal Party (PL) filed a Direct Action of Unconstitutionality in relation to the collection of the tax.

According to the request, the Federal Government sought to “dodge, albeit unconstitutionally, the principles of precedence (an ironclad clause), predictability and legal certainty”. Minister Gilmar Mendes will be responsible for reporting the action.

The tax on crude oil export activities in Brazil was created and put into practice overnight, without prior preparation in the market.

In addition to affecting multinational oil companies that annually invest billions of dollars in the domestic oil and gas sector, the tax also impacts Petrobras' operations. The shareholders of the state-owned company are mobilizing for an action against the collection of the tax.

Shell and other oil companies warn of uncertainties in investments in the domestic market after approval of the tax on exports of crude oil

Upon filing a request in Federal Court for the end of charging the tax on the export of crude oil, the multinational oil companies highlighted their main points in the action.

Among them, Shell stated that it is not sure about investments in the domestic market after the approval of the measure.

"The measure, which was announced without significant dialogue with the industry, brings uncertainty about new investment decisions, affecting Brazil's competitiveness in the exploration and production sector - in which the country has a strong geological potential", said the oil company.

The company is the second largest producer in Brazil, behind only Petrobras, with a daily production capacity of 400 barrels/day. In addition, it exports practically 100% of all barrels produced.

Thus, it is one of the main oil companies to be affected by the tax on the export of the product.

Now, sector representatives are working so that Congress does not approve this MP article. However, the segment's desire is that the tax not only not be approved, but also not be put into practice as permanent in the market.

The multinational oil companies continue with their actions in the Federal Court to prevent the collection of tax on oil exports this week.

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Ruth Rodrigues

Graduated in Biological Sciences from the State University of Rio Grande do Norte (UERN), she works as a writer and scientific disseminator.

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