L AW

UNDERSTAND
PAYMENT INDUSTRY
IN BRAZIL
1
The American Chamber of Commerce for Brazil, being the largest Amcham outside
the United States is serving its members building bridges for Brazilian businesses
worldwide. Our foreign investment attraction efforts are a key mission for Amcham.
The “How To” guides published by Amcham Brasil are part of this initiative. With the
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together strategic information on the most various aspects of doing business in Brazil
and its opportunities. As part of BRICS (Brazil, Russia, India, China and South Africa)
and representing the 8th largest economy of the world, and the 4th largest destination
for foreign investment, Brazil has an intrinsic importance for the global market. More
than ever it is a strategic time for businesses opportunities in Brazil. We welcome
you and hope that the information you are about to read will contribute to your
commercial and investment decisions linked to Brazil.

Deborah Vieitas – CEO, Amcham Brasil

The technical evolution of the Brazilian society and of payment instruments have
required significant changes in the Brazilian payment industry, which is a very dynamic
market. Although cash is still the most used payment method by the Brazilian
population, other methods, especially electronic ones, are increasingly used.
This guide, developed in partnership with FAS Advogados, describes the current
regulation of the Brazilian payment industry – as of December 2018 – presenting the
different types and models of services that can be offered in the country and also the
legal aspects related to the new technologies applied to this industry, such
as cryptocurrencies.

Paulo Mertz Focaccia – Partner, Focaccia, Amaral, Pellon e Lamonica Advogados

CONTENT
01 INTRODUCTION 06

02 RELEVANT CONCEPTS AND PREMISES OF THE APPLICABLE LEGAL FRAMEWORK 08

03 PAYMENT SCHEMES 12

04 PAYMENT INSTITUTIONS 18

05 PAYMENT ACCOUNTS 22

06 MAIN REGULATORY OBLIGATIONS 24

07 MOST RELEVANT CURRENT DISCUSSIONS 26

08 ABOUT OUR SPONSOR 30

 01.
INTRODUCTION
The Brazilian payment industry is very
dynamic and has changed significantly
over the last 10 years. These changes
are closely connected to the technical
development of our society, which has
brought the need of using electronic
payment methods, in the most
different scenarios.
Although cash is still the most used
payment method by the Brazilian
population, other methods, especially
electronic ones, are increasingly used,
according to studies published by the
Brazilian Central Bank (Central Bank
or BACEN) in 2013 and 2018.
6
 Payment methods used (% of the Brazilian population)

96
Cash
100

52
Debit card
39

46
Credit card 35

Eletronic transfer 39
and automatic debit 11

Meal vouchers 11
and food tickets 4

7
Other methods 7

2018
0 20 40 60 80 100
2013

The significant increase in the usage of electronic
payment methods in the last years relates to a series
of interventions from legislators, the Central Bank and
the Brazilian Competition Policy System. All these
interventions aimed to increase competition in the
payment industry, which is a highly concentrated market.
Until 2009, the Brazilian acquiring market consisted of
a virtual duopoly. The two main card labels (Visa and
Mastercard) – which, together, were responsible for more
than ninety percent (90%) of the credit card market and
eighty percent (80%) of the debit card – had exclusivity
agreements with specific acquirers (Visanet and
Redecard, respectively).
Faced with this situation, which had a negative impact
over the competition in the payment industry, Brazilian
authorities intervened in a way that changed the
regulatory payments landscape completely.
First, in 2009, anti-trust authorities determined that the
exclusivity practice with the acquiring companies should
cease. Later that year, the Central Bank determined
that all card labels should be transparent regarding their
commercial practices, improving other acquirers’ access
to information. This allowed other acquirers to have
access to the two biggest labels in the Brazilian market,
Visa and Mastercard.
In 2013, the Brazilian Government issued a specific
legal framework to govern the payment industry through
Provisional Measure No. 615/2013, which was later
converted into Law No. 12,865/2013, regulated by the
National Monetary Council and the Central Bank. Before
then, this market did not count on a specific regulation,
which created legal uncertainty and doubts among the
players of the sector.
 02.
RELEVANT CONCEPTS
AND PREMISES OF THE
APPLICABLE LEGAL
BILL
$ FRAMEWORK
$
Law No. 12,865/2013 establishes
that payment schemes and payment
institutions become part of the
BANK Brazilian Payments System (Sistema de
Pagamentos Brasileiros or SPB), subject
1234 5678 1234 5678 to regulation from the Central Bank,
according to guidelines established by
the National Monetary Council.
It also introduces to the Brazilian
legal framework a series of relevant
PAY concepts, namely:
8
PAYMENT SCHEMES
Set of rules and procedures which regulates the provision to the public of
certain payment service accepted by more than one recipient, by means of
direct access by end users (payers and recipients);

PAYMENT SCHEME OWNER

A legal entity responsible for a payment scheme and, when appropriate, by
the use of the brand associated with the
payment scheme;

PAYMENT INSTITUTION
Legal entity, adhering to one or more payment schemes, having as main or ancillary
activity1 at least one of the following:
a) providing cash-in and cash-out services of the funds held on payment accounts;
b) performing or facilitating payment instructions related to definite payment service,
including transfers originated from or intended for a payment account;
c) managing payment accounts;
d) issuing payment instrument;
e) acquiring payment instrument;
f) remittances;
g) converting physical or book-entry currency into e-money, or vice versa, acquiring
the acceptance or managing the use of e-money; and
h) other activities related to the provision of payment services, designated by the
Central Bank.
1
It is important to notice that, as per the second paragraph of article 6th of Law no.12,865/2013, payment institutions are
not allowed to conduct activities that are restricted to financial institutions (as provided for in applicable laws), in spite of the
activities listed above. Thus, they are not allowed to use client’s funds to grant loans to third parties, for example.
 It is possible to better understand these concepts by analyzing a prepaid card Payment Scheme, such as the following:

CLIENT MERCHANT

PAYMENT PAYMENT
INSTITUTION INSTITUTION
THAT ISSUES THAT PROVIDES
THE CARDS THE POS
TERMINAL

PAYMENT SCHEME OWNER

(CARD LABEL)
10
Law No. 12,865/2013 also introduces to the Brazilian
legal framework the following definitions:
PAYMENT ACCOUNT:
book-entry account, held
on behalf of an end user of
payment services, used
for the execution of
payment transactions;
PAYMENT INSTRUMENT:
device or set of procedures
agreed between the end
user and his/her payment
service provider, used
to initiate a payment
transaction; and
E-MONEY:
resources stored in a
device or electronic
system that allow the end
user to perform payment
transactions.
This regulatory milestone also sets forth that Payment
Schemes and Payment Institutions shall observe the
following principles, in order to ensure the capacity for
innovation and the diversity of business models:
a) interoperability within the payment scheme and
between different payment schemes;
b) soundness and efficiency of payment schemes
and payment institutions, promotion of competition
and provision for e-money balances transfer, when
applicable, to other payment schemes or institutions;
c) non-discriminatory access to infrastructures
and services required for the functioning of the
payment scheme;
d) meet end-users needs, in particular with respect
to freedom of choice, safety, protection of their
economic interests, non-discriminatory treatment,
privacy and personal data protection, transparency
and access to clear and complete information about
the service;
e) reliability, quality and security of payment services; and
f) financial inclusion, in compliance with the
standards of quality, security and transparency in all
payment schemes.
The Law also establishes that the funds held in
payment accounts constitute separate assets, and
they do not integrate Payment Institution’s assets.
Consequently, such funds (i) cannot be pledged and
shall not be subject to any judicial restraint, such
as attachment, search and seizure, due to debts
undertaken by the Payment Institution; (ii) are not part
of the Payment Institution assets, for the purposes of
bankruptcy; and (iii) cannot be pledged as collateral for
debts assumed by the Payment Institution. This is a very
important concept introduced by the law that ensures
more reliability to customers of services provided by
Payment Institutions.
BILL 03.
PAYMENT
$ SCHEMES
bank name

$ $ 150

pay

credit card

$
12
DIFFERENT TYPES
Payment Schemes are specifically regulated by
Circular 3,682/2013, that initially divides them into two
categories: (i) schemes that are considered part of the
SPB, which require a license from the Central Bank, and
(ii) schemes that are not part of the SPB and therefore do
not need a license.
The following types of Payment Schemes are not
considered part of the SPB:
Limited Purpose Schemes, such as those in which the
relevant payment instrument: (i) is accepted exclusively
by a chain of merchants of a certain company, even if
not issued by such company (i.e. private label cards);
(ii) is accepted exclusively by a chain of merchants
which clearly presents the same visual identity, such
as franchisees; or (iii) is destined for the payment of
specific public services such as public transportation;
Benefit Program Schemes, as those in which the
relevant payment instrument is offered in the scope of
benefit programs for individuals resulting from work,
services or similar relationships and which have been
instituted by the municipal, state or federal executive
power; and
2
Although Payment Schemes operating under such operational limits are not considered
part to the SPB and, therefore, are not subject to Central Bank’s regulation and
license, they still must report certain information to the Central Bank, on an annual
basis. Besides, the owners of these schemes must monitor the evolution of the limits
established and, once any of them has been met, they must: (i) submit an authorization
request to the Central Bank; and (ii) communicate the fact to the Payment Institutions
that participate in the scheme, through letters and publication in newspapers, about their
obligation of requesting an authorization to the Central Bank, as applicable.
Schemes Below Operational Limits, those which
have not reached any of the following thresholds: (i) BRL
500,000,000.00 (five hundred million Brazilian Reais) in
total transaction amount, accumulated in the previous 12
months; and (ii) 25,000,000 (twenty-five million) individual
transactions, accumulated in the previous 12 months2.
Circular No. 3,682/2013 created two types of Payment
Schemes: Closed-ended Payment Schemes (arranjos
de pagamento fechados) and Open-ended Payment
Schemes (arranjos de pagamento abertos).
The so-called Closed-ended Payment Schemes are
those in which the management of electronic currency
or, cumulatively, the management of payment accounts,
the issuance of payment instruments and the allowing
merchants to accept said payment instruments, are
carried out: (i) exclusively by one single Payment
Institution or financial institution which is also the
Payment Scheme Owner, (ii) by a Payment Institution or
financial institution which is the controlling shareholder
of, or controlled by, the Payment Scheme Owner; or (iii)
by a Payment Institution or financial institution which
controlling shareholder is the same of the Payment
Scheme Owner.
Payment Schemes can also be divided into: (i) Purchase
Payment Schemes (arranjos de pagamento de compra),
in which payment services are related to the settlement
of obligations related to purchases of goods/services;
and (ii) Transfer Payment Schemes (arranjos de
pagamento de transferência), in which payment services
are not solely used for purchase transactions.
Payment Schemes may also be classified in relation
to the jurisdictions in which they operate: (i) Domestic
Payment Schemes (arranjos de pagamento
domésticos), those involving payment instruments that
issued and used exclusively within the Brazilian territory;
and (ii) Cross-border Payment Schemes (arranjos
de pagamento transfronteiriços), Schemes involving
payment instruments issued within the Brazilian territory
and used abroad, or vice versa.
 PARTICIPATION REQUIREMENTS
The Central Bank has determined that, in order to
participate in Payment Schemes, Payment Institutions,
financial institutions and service providers in Payment
Schemes must be authorized to operate by the Central
Bank (applicable only to Payment Institutions and
financial institutions, as established by the specific
regulation) and comply with the requirements set forth in
the rules of said Payment Scheme.
3
Considering the breadth of the definition set forth by Circular No. 3,682/2013,
not only payment facilitators but also some marketplaces may be considered
Subacquirers (those that receive all payments and afterward splits them between
merchants), while others do not fit the definition (those that use third party
payment splits).
14
CENTRALIZED SETTLEMENT
Upon the enactment of Circular No. 3,886/2018, which
amended Circular No. 3,682/2013, entities operating as
subacquirers (subcredenciadores) or payment facilitators
(facilitadores de pagamentos) officially became participants
of Payment Schemes. As provided in item VIII, article 2
of the Regulation attached to Circular No. 3,682/2013,
Subacquirer may be defined as an entity that, without
managing payment accounts, (i) is responsible for allowing
merchants (individuals or legal entities) to accept payment
instruments issued by Payment Institutions or by financial
institutions that participate in the same Payment Scheme,
but (ii) does not participate in the settlement process
of payment transactions, as creditor against the issuer
of payment instruments, pursuant to the rules of the
respective Payment Scheme (they participate as creditors
of acquirers)3.
Circular No. 3,886/2018 also introduced the obligation
of centralizing in a neutral agent the clearing and
settlement of transactions arising under a Payment
Scheme. This requirement is applicable to Payment
Schemes participating in the SPB, in which the
settlement between end users implies transfers of
funds between different financial institutions
or Payment Institutions.
BILL
 According to art. 26 of said Regulation, the clearing and
settlement of credit/debit electronic orders between
financial institutions and/or Payment Institutions which
are part of a certain Payment Scheme that participates
in the SPB must be performed: (i) in a centralized form,
through a system duly authorized by the Central Bank;
and (ii) integrate, in a single grid, the position of all of
the participants of such Payment Scheme which are
involved in the cash flow of the payment transactions,
that render payment services directly to the final users of
said transactions.
The system chosen by the applicable entities was
Câmara Interbancária de Pagamentos (CIP), a non-profit
organization that operates as a clearing house for the
SPB. It is engaged in creating, developing and operating
systems for the transfer of funds and other financial
and information assets, as well as processing and
settling electronic payments. It was founded by financial
institutions that comprise the Brazilian banking market
and provides services for banks, credit card issuers,
registry offices, funds, database system managers,
public agencies and others.
L
Scheme Owners, issuers of payment instruments,
acquirers and financial institutions that operate as
deposit institutions had to adapt to this new obligation
until November 20th, 2017, and other participants
through which the cash flow transits (such as
Subacquirers) had until September 28th, 2018, to
comply with such requirement.
The current wording of Circular No. 3,682/2013
establishes that, in order to operate as a recipient of
payments, a Subacquirer is required to connect with CIP
(regardless of the amount of such transactions), hiring a
settlement institution duly authorized to operate in the
CIP system4.
When a Subacquirer sends a payment to a merchant
it may opt for connecting or not to CIP, if in the last 12
months it has processed less than BRL 500 million in
total transactions
4
The list of entities connected to CIP is available at https://www.cip-bancos.org.
br/Monitoramento/Participantes%20Homologados.pdf. Settlement institutions are
identified as “Liquidante”.
 WHAT DOES IT MEAN TO BE
CONNECTED TO CIP?
All players connected with CIP must inform the
amounts due to their respective creditors. Thus,
CIP shall receive information about the amount
owed by card issuers to acquirers, by acquirers
to merchants and Subacquirers, and also by
Subacquirers to merchants.
After receiving such information, CIP shall cross
them in order to validate them and to obtain
the plurilateral result of the operations, which is
informed to the players.
Once players receive this information, each of
them transfers to CIP the total due amount and
subsequently CIP transfers the amounts due to
each creditor, completing the settlement process.

It is important to notice that the centralized settlement

obligation is not applicable to schemes that are not
part of the SPB and to close-ended schemes. However,
such exemption does not apply to close-ended payment
schemes that act as participants of open-ended
payment schemes.
1234 5678 9012 3456

$
1234
5678
9012
3456

SALE
16
 INTEROPERABILITY
Interoperability is one of the principles that must
be observed by Payment Schemes and Payment
Institutions, as per Law No. 12,865/2013.
More recently, in 2016, the Central Bank launched a work
agenda (BC+), which intends to review structural points of
the market, in order to generate sustainable benefits for
society. As part of this agenda, in March 2018, a public
hearing was launched, presenting a proposal to regulate
how Payment Schemes must interoperate.
At the time, two scenarios coexisted: (i) interoperability
through participation, in which the Owner of a certain
Payment Scheme participates in a second Payment
Scheme, adhering to its rules; and (ii) interoperability
through specific bilateral agreements, in which the
Owners of each Payment Scheme jointly set forth the
rules, obligations and responsibilities for each of them.
E caused by divergent bilateral agreements.
The aforementioned Public Hearing suggested that
the interoperability between closed-ended and open-
ended Schemes should be implemented solely through
participation: according to the justification presented by
the Central Bank, interoperability by means of bilateral
agreements could have negative impacts over competition,
representing, in many cases, a discriminatory treatment
regarding certain players, and also a high social cost.
Several entities have presented their considerations
regarding this proposal – many of them contrary to it,
arguing that the interoperability through participation could
harm competition. After analyzing such considerations,
on December 2018, BACEN issued Circular no.
3,925/2018, which, among other things, establish that
open-ended Payment Scheme Owners must allow
Closed-ended Payment Schemers to interoperate through
bilateral agreements, which must be formalized using a
standardized draft, in order to prevent possible disparities
 04.
PAYMENT
INSTITUTIONS
18
Pursuant to BACEN Circular No. 3,885/2018, which regulates Payment Institutions, such entities can be divided into
three categories5:

Electronic Currency Issuers: Payment Institutions issuers of electronic currency (or

e-money)6, managing Prepaid Payment Accounts (as defined below) and providing
services related to payment transactions carried out with electronic currency previously
allocated in such accounts. This type of Payment Institution may also convert physical
or book-entry currency into electronic currency or vice versa and enroll the acceptance
of electronic currency by merchants with settlement in payment accounts managed by
the Payment Institution7;

Postpaid Payment Instrument Issuers: Payment Institutions issuers of postpaid

payment instruments, managing Postpaid Payment Accounts (as defined below) and
providing services related to payment transactions registered in such accounts8; and

Acquirers: Payment Institutions that, without operating Payment Accounts, (i) are
responsible for allowing merchants (individuals or legal entities) to accept payment
instruments issued by Payment Institutions or by financial institutions that participate
in the same Payment Arrangement of the relevant Acquirer, and (ii) participate in the
settlement process of payment transactions, as creditor against the issuer of Payment
Instruments (such as credit card issuers), pursuant to the rules of the respective
Payment Arrangement9.

5
Depending on the activities to be performed by a certain Payment Institution, it may fall into more than one category.
6
According to Circular No. 3,885/2018, “electronic currency” can be defined as BRL-denominated funds stored in electronic systems or electronic devices (such as prepaid cards)
allowing end-users to make payment transactions.
7
Prepaid card issuers and mobile payments classified as Electronic Currency Issuers.
8
Credit card companies (administradoras de cartões de crédito) classified as Postpaid Payment Instrument Issuers.
9
This type of Payment Institution includes merchant acquirers (credenciadores de cartões), such as Cielo, Rede and Stone. Gateway-only service providers would not be
considered Acquirers for purposes of this rule, since for an entity to be considered an Acquirer, it has to be creditor of the issuers and participate in the settlement of transactions –
such companies could be considered Subacquirers, as mentioned in section Centralized Settlement above.
 It is possible to better understand these concepts by analyzing a card Payment Scheme, such as the following:

SUBCQUIRER -
COMPANY WHICH IS
NOT CONSIDERED
A PAYMENT
INSTITUTION,
AUTHORIZED
BY ACQUIRER
TO ALLOW
MERCHANTS TO
ACCEPT CARD. IT
IS THE CREDITOR
AGAINS SAID
CLIENT ACQUIRER.

MERCHANT
PAYMENT
INSTITUTION
ACQUIRER - PAYMENT
THAT ISSUES INSTITUTION AUTHORIZED
THE CARDS BY CARD LABEL TO
ALLOW MERCHANTS
TO ACCEPT CARD. IT IS
THE CREDITOR AGAINST
THE ISSUER.

PAYMENT SCHEME OWNER

(CARD LABEL)
20
Circular No. 3,885/2018 also establishes that Payment
Institutions that, in the last twelve (12) months,
surpasses BRL 500,000,000.00 (five hundred million
Brazilian Reais) in payment transactions, or BRL
50,000,000,00 (fifty million Brazilian Reais) in funds held
in Prepaid Payment Accounts must file an authorization
request before the Central Bank, within ninety (90) days
from the date on which such surpassing has occurred.
If the Payment Institution operates in more than one of
the categories listed above, it must request authorization
for each category it operates in. Besides, if a certain
authorized payment Institution decides to operate in
a category for which it has not been authorized by the
Central Bank, it must request a specific authorization for
such category.
In addition to that, Circular 3,885/2018 provides for
several requirements concerning the organization and
operation of Payment Institutions.
For instance, a Payment Institution must be incorporated
as a limited liability company or a corporation and has
as main corporate purpose at least one of the activities
listed in art. 6 of Law No. 12,865/2013, also mentioned
in this guide’s Chapter 2.
Payment Institutions may also perform additional
activities, provided that they have the purpose of
enabling the rendering of payment services or add value
to the payment services provided to the user, at Central
Bank’s discretion.
Also, as set forth in art. 30, licensed Payment Institutions
are required to have an initial paid-in corporate capital
of BRL 2,000,000.00 (two million Brazilian Reais) for
each category of payment activity they carry out.
Such initial capital shall be paid-in in cash. It is also
worth mentioning that licensed Payment Institutions
participating exclusively in a Closed-ended Payment
Arrangement and rendering services as Electronic
Currency Issuer or Postpaid Instrument Issuer are
required to have an initial paid-in corporate capital of
BRL 3,000,000.00 (three million Brazilian Reais).
Besides, Circular No. 3,885/2018 establishes that the
appointment of officers and members of the board of
directors, as well as some changes to the corporate
documents of authorized Payment Institutions, are
subject to prior approval by the Central Bank.
 RECEIPT
05.
RECEIP
RECEIP
RECEI PAYMENT
ACCOUNTS

TOTAL
22
Payment Accounts can be divided into two categories, pursuant to BACEN Circular
No. 3,680/2013:

Prepaid Payment Accounts, designed for payment

transactions performed with BRL-denominated funds
pre-allocated in such accounts10; and

Postpaid Payment Accounts, designed for payment

transactions independent of pre-allocated funds.

As per this Circular, all Payment Institutions operating Payment Accounts must
appoint an officer to be in charge of payment accounts and oversee the compliance
by the institution with applicable legal requirements related to these accounts; and
identify the end-user of each payment account11.
Circular No. 3,680/2013 also establishes that Electronic Currency Issuers and
Postpaid Payment Instrument Issuers must comply with the rules and procedures
applicable for money-laundering prevention, as provided for in Law No. 9,613/1998,
as amended (“Money Laundering Law”), and BACEN Circular No. 3,461/2009,
except for the collection and storage of clients’ information, which must follow the
requirements of Circular No. 3,680/2013.

10
Note that Payment Institutions qualified as Electronic Currency Issuers (and therefore operating Prepaid Payment Accounts) must
ensure that the end user is able to redeem the total amount deposited in any such account at any time.

User identification requirements are different depending on the amounts to be deposited in the Payment Account.
11
 06.
MAIN REGULATORY
OBLIGATIONS
24
 The payment industry is currently highly regulated.
Creating an Ombusdman department, which shall
Therefore, its players are subject to a series
provide last resort assistance to demands raised by
of regulatory obligations, among which we
clients and users;
may highlight:

Answering the complaints registered in the Citizen

Compliance with banking secrecy requirements
Complaints Registration System (Sistema de Registro
provided for in Complementary Law No. 105/ 2001;
de Demandas de Cidadãos or RDR);

Providing information regarding their end-users

Compliance with cyber security requirements,
through the Clients Register of the National Financial
provided for in Resolution No. 4,658/2018 and
System (Cadastro dos Clientes do Sistema Financeiro
Circular 3,909/2018, as applicable;
Nacional or CCS);

Observing the accounting requirements set forth in

Providing information on certain credit transactions
the Accounting Chart for Institutions of the National
through the Credit Information System (Sistema de
Financial System (Plano Contábil das Instituições do
Informações de Crédito or SCR);
Sistema Financeiro Nacional or COSIF);

Revision of financial statements by independent

auditors and, depending on the reference net worth
it may be necessary to create a corporate body Observing certain capital adequacy requirements; and
designated as an audit committee, responsible
to ensure compliance by the institution with the
applicable accounting regulations;

Reporting suspicious transactions to the Financial Observing floating requirements.

Activity Control Council (Conselho de Controle de
Atividades Financeiras or COAF);

Please notice that not all of the obligations listed

Implementing risk management above are applicable to all types of institutions which
procedures; corporate governance policy; internal are part of the payment industry, since some of these
controls; and anti-money laundering and know-your- institutions are exempt from complying with certain of
client procedures; the obligations aforementioned.
 07.
MOST RELEVANT
CURRENT
DISCUSSIONS
The dynamic nature of the payment industry
environment makes it a fertile ground for the
development of new and innovative tools and also for
the innovative application of preexisting technologies.
These new tools and new uses of such technologies
generate several doubts and sometimes inflamed
discussions regarding their regulation – some of which
deserve to be mentioned herein.
26
CRYPTOCURRENCIES
Due to the fast growth of the cryptocurrency market,
the usage of such currencies and whether the regulation
applicable to financial and payments systems applies to
them have been the theme of international debate and
public announcements by monetary authorities and other
public institutions. The Brazilian Chamber of Deputies, for
instance, is analyzing – as of December 2018 – three (3)
bills of law that intend to regulate the matter.
The first, introduced in 2015, provides for the inclusion of
virtual assets and airlines mileage programs in the definition
of “payment arrangements” under the supervision of the
Central Bank, and would require individuals and companies
engaged in investment businesses to closely monitor deals
involving virtual currencies and air mileage programs for
crimes of money laundering or concealment of assets.
The second, in short, intends to criminalize all conducts
related to cryptocurrencies, except Initial Coin Offerings
with utility tokens, and it remains awaiting the end of this
legislative process.
The last bill of law, on the other hand, proposes that
cryptocurrencies may be freely transferred, provided
that certain conditions are observed; and used as
payment means, through acceptance of the parties. It
also proposes that regulatory agencies (which are not
named in the bill of law) be responsible for regulating
their use – forbidding them to create standards that
aim at prohibiting the circulation of cryptocurrencies
and the activities of companies that provide services of
intermediation, exchange, purchase and sale and custody
of cryptocurrencies.
Although there is no specific regulation subjecting
cryptocurrencies to BACEN’s supervision, the institution
has already issued two statements about the matter.
On February 19th, 2014, it has issued Policy Statement
No. 25,306 (“2014 Statement”), regarding the risks
related to the acquisition of the so-called “virtual
currencies” or “cryptocurrencies” and transactions
carried out with these currencies. The purpose of
the 2014 Statement was, inter alia, to clarify that
cryptocurrencies should not be confused with e-money.
The 2014 Statement broadly explains that e-money is
a resource stored in a device or electronic system that
allows the final user to make payment transactions in
the national currency (Brazilian Real, or BRL). In other
words, it is denominated in Brazilian Real. On the other
hand, virtual currencies are denominated in a different
unit of account from the currencies issued by sovereign
governments and are not stored in a device or electronic
system in national currency.
It also mentions that virtual currencies are not issued
or guaranteed by a monetary authority and are not
regulated or supervised by the monetary authorities
of any country, so there is no government mechanism
that guarantees the value in official currency of those
instruments known as virtual currencies.
The 2014 Statement also advises about possible fast
and wide price floating (leading even to total value loss)
and the possibility of involvement of cryptocurrency
users in investigations, due to the eventual usage of this
instrument in non-compliant activities.
 Furthermore, BACEN states that the storage of The 2017 Statement further detailed that companies
cryptocurrencies in the so-called electronic wallets that negotiate or store virtual currencies on behalf of
presents the risk of financial loss to their holders, due to their owners (that can be natural persons or
criminal attacks in the world wide web. legal entities), (i) are neither regulated, licensed to
operate, nor supervised by BACEN; (ii) there is no
Finally, BACEN states that, although the use of
specific provision governing virtual currencies in
cryptocurrencies in Brazil does not yet seem to offer
the legal and regulatory frameworks associated
risks to the National Financial System (particularly
with the National Financial System; and (iii) BACEN,
to retail payment transactions), the evolution of the
in particular, neither regulates nor supervises
usage of these instruments, as well as the related
transactions involving virtual currencies.
discussions in international forums (especially
regarding their nature, ownership, and functioning) is The statement also reminded people that virtual
being monitored by the Central Bank, in order to allow currencies are not to be confused with e-money and,
the potential adoption of measures in its sphere of in addition, it highlighted that, in BACEN’s opinion,
legal competency, if necessary. carrying out international wire transfers referenced in
foreign currencies through the use of virtual assets
On November 16th, 2017, due to the growing interest
and related instruments does not exempt companies
of individuals and companies in cryptocurrencies,
from the obligation to comply with foreign exchange
BACEN issued another statement (Policy Statement
rules — especially the rule establishing that this type
No. 31,379) (“2017 Statement”). In this new
of transaction may only be performed by institutions
statement, BACEN warned the public about the risks
authorized by BACEN to operate in the foreign
derived from storing and negotiating virtual currencies
exchange market.
and reiterated that these assets are neither issued nor
guaranteed by any monetary authority.
28
OPEN BANKING
Open banking can be defined as a collaborative model in
which banking data is shared with third parties through
Application Programming Interfaces (APIs), so that they
are able to deliver enhanced capabilities (products and/
or services) to the marketplace, with the consent of
the client that owns such data. This subject has been
receiving attention in Brazil and abroad, especially after
the Payment Services Revised Directive (PSD2) has
come into force in Europe.
The Central Bank intends to define, until the end of
2018, a general model for the regulation of the matter,
which shall start to be implemented in 2019.
BACEN shall establish requirements for the system of
data sharing, limits for the scope of services that may be
offered, types of companies that may offer its services
through such APIs and also an implementation schedule.
It is expected that, aiming to improve competition, the
new regulation will encourage (or even push) banks to
provide their clients data, when duly authorized by them.
INSTANT PAYMENTS
BACEN is working on the implementation of an instant
payment model as part of a number of measures
geared at fostering competition in the financial and
payments environment.
Instant payments are expected to be implemented
under a phased approach, starting in 2019, and to
be fully operational by 2021 – in order to initiate the
implementation process, BACEN has published the
fundamental requirements for this new payments
ecosystem in December 2018.
The new model shall allow real-time, 24/7 payments
and its rules will be defined by the Central Bank,
which shall create the conditions required for the
development of an instant payment system that is
efficient, competitive, safe, inclusive and comprises all
use cases.
The rules of the system will be issued by BACEN,
which will count on a permanent consulting committee
consisting of industry players, connectivity service
providers and end users’ representatives.
Some of specific rules, of operational nature, may be
defined by a governance structure created specifically
for this purpose.
The system shall have a flexible and open
participation structure, in order to ensure the access
and the emergence of players that provide innovative
and differentiated services, that fill end users’ needs.
It will be possible to participate in three ways: directly,
indirectly or as a provider of payment initiation
services – the latter way subject to specific regulation.
BACEN will be responsible for developing and
operating the centralized settlement infrastructure, to
which participants may connect directly or through
connectivity service providers (“switches”).
 08.
Focaccia, Amaral, Pellon e Lamonica Advogados – FAS Advogados
– has a philosophy of delivering added value to its clients’ business,
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The firm believes that legal services can only be fully realized by
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Since 2003, FAS Advogados has established itself as one of the most
dynamic firms on the Brazilian market, by providing legal services that
are able to positively and strategically impact their businesses.
FAS’ team is comprised of highly qualified professionals, dedicated to
providing top legal services within strict ethical standards. They aim
to establish legal services in a way that rewards personal qualities,
aligned with the most contemporaneous methods of highly-successful
corporate relations.
Internally, FAS strives for participative management, by providing our
team with the opportunity to collaborate on ideas, suggestions and
innovations aimed at achieving its practices.

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