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Supreme Federal Court (STF) Sends the Impasse Involving Maricá, Niterói, Rio, and Neighboring Municipalities for a Attempt at a Consensual Solution; Amounts at Stake Exceed R$ 7 Billion Annually.
The legal entanglement surrounding the redistribution of oil royalties took a new turn with the decision of the Supreme Federal Court (STF) to transfer the process to the Court’s Center for Consensual Conflict Resolution.
The measure, taken by Minister Edson Fachin, aims to mediate a possible understanding between the municipalities of Maricá, Niterói, Rio de Janeiro, and the cities of São Gonçalo, Guapimirim, and Magé, which are seeking a new division of resources.
The decision was announced after the president of the STF, Minister Luís Roberto Barroso, declared himself biased to judge the case, forwarding the files to his colleague Fachin. The initiative paves the way for an attempt at conciliation in a process that has dragged on for years and involves technical, political, and legal divergences regarding the current criteria for the distribution of royalties.
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Conflict Between Municipalities Pits Coastal Against Inland
The cities of São Gonçalo, Guapimirim, and Magé filed an appeal with the STF against the National Agency of Petroleum (ANP), the Brazilian Institute of Geography and Statistics (IBGE), and other federal entities, requesting a review of the criteria used in the division of oil royalties.
The argument is that the technical parameters defined by the institutions favor only the coastal municipalities, ignoring the impacts suffered by cities close to the areas of exploration.
Currently, Rio de Janeiro, Maricá, and Niterói collect about R$ 7 billion per year in royalties. In contrast, the three demanding municipalities together receive approximately R$ 400 million. If the redistribution is approved, this amount could reach R$ 1.5 billion.
Attempt at Conciliation Over Oil Royalties Divides Opinions
Although there is willingness on the part of the capital of Rio and Maricá for a conciliation hearing, the proposal meets resistance in Niterói.
In a post on social media, Mayor Rodrigo Neves declared: there is no possibility of a conciliation hearing between the parties and reiterated his defense for the creation of a fund to balance the transfers without changing the existing legal criteria.
On the other hand, the Mayor of Rio de Janeiro, Eduardo Paes, expressed support for the redistribution, contradicting the position of the Municipal Attorney General’s Office of Rio, which requested the STF to reject the appeal. The Attorney General argues that the three municipalities are not entitled to the funds, as established by current legislation.
State Assembly of Rio Discusses Impasse
The topic was also debated last Tuesday (29) in the State Assembly of Rio de Janeiro (Alerj).
State Deputy Vitor Junior proposed the creation of a state financial support program for neighboring municipalities of the oil-producing regions, but criticized the request for redistribution made by São Gonçalo, Guapimirim, and Magé.
The statement generated reactions among the parliamentarians. Deputy Júlio Rocha disagreed with Vitor Junior’s proposal and stated that he believes in a favorable decision for the demanding municipalities in the Supreme Federal Court.
Understand the Current Criteria for the Division of Oil Royalties
Oil royalties are financial compensations intended for the federative entities affected by the activities of the oil industry, both from an environmental and social perspective.
The National Agency of Petroleum and the IBGE define the collection zones based on the geographical location of the extraction, which has raised questions about the fairness of these criteria, especially for non-coastal municipalities that are indirectly affected by the exploration.
The case is still in progress at the STF, now focusing on a possible mediation that could prevent a longer and more exhausting judgment.
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