Sign up for tax alert emails    GTNU homepage    Tax newsroom    Email document    Print document    Download document

December 13, 2019

Brazilian National Attorney General regulates recently enacted conflict resolution system

Brazil’s National Attorney General’s Office (PGFN) published Normative No. 11.956/2019, and Notice No. 1/2019, regulating the eligibility and application requirements for the conflict resolution system. Provisional Measure No. 899/2019 established the conflict resolution system, which is intended to reduce controversy between Brazilian taxpayers and federal tax authorities.

Normative No. 11.956/2019 on conflict resolution system

The new conflict resolution system allows the taxpayer and tax authorities to negotiate the amount of the taxpayer’s tax liability. A tax liability may qualify for the conflict resolution system, regardless of whether the collection of the liability is managed by the PGFN. Normative No. 11.956/2019 sets forth when a tax liability that is part of litigation involving the PGFN may be negotiated as follows:

What can be negotiated with discount
What can be negotiated without discount
What cannot be negotiated
Key benefits to be obtained with the negotiation

Federal tax liabilities deemed as non-recoverable or hard to be recovered by the Government

Other federal payable taxes as long as certain requirements are met

Severance fund debts; taxes under the simple tax regime (Simples Nacional), “qualified” penalties (e.g., when there is fraud), criminal penalties

Up to 50% general discount on the total amount of the federal tax liability

Payment in up to 84 monthly installments

Grace period of up to 180 days for the first installment if the taxpayer is under judicial reorganization

Taxpayers with an overall outstanding federal tax debt of up to BRL15 million are entitled to a simplified negotiation method through the conflict resolution system, while an outstanding tax debt of more than BRL15 million would require individual negotiations between the taxpayer and the PGFN.

Notice No. 1/2019 on procedures for first-round negotiations

On 4 December 2019, the PGFN issued a public notice that detailed the procedure for the first round of negotiations for taxpayers with overall tax debts below BRL15 million. The notice addresses discounts and the number of installments to which specific taxpayers would be entitled (for example, those with outstanding litigation for longer than 15 years), confirming the average terms set out in Normative No. 11.956/2019.

Multinationals with a presence in Brazil also should be aware that, based on what has been announced by the PGFN, the negotiation approach to tax conflict resolution seems to be an alternative approach to amnesty programs. According to the PGFN website, the Government believes amnesty programs negatively impacted the ax revenue while benefitting taxpayers with the financial capacity to regularly pay their taxes.

Taxpayers in Brazil should evaluate their outstanding federal tax liabilities that are currently under litigation with the PGFN and determine whether they might benefit from the conflict resolution system.

For additional information with respect to this Alert, please contact the following:

Ernst & Young Assessoria Empresarial Ltda, São Paulo
Ernst & Young LLP (United States), Latin American Business Center, New York
Ernst & Young LLP (United Kingdom), Latin American Business Center, London
Ernst & Young Tax Co., Latin American Business Center, Japan & Asia Pacific



The information contained herein is general in nature and is not intended, and should not be construed, as legal, accounting or tax advice or opinion provided by Ernst & Young LLP to the reader. The reader also is cautioned that this material may not be applicable to, or suitable for, the reader's specific circumstances or needs, and may require consideration of non-tax and other tax factors if any action is to be contemplated. The reader should contact his or her Ernst & Young LLP or other tax professional prior to taking any action based upon this information. Ernst & Young LLP assumes no obligation to inform the reader of any changes in tax laws or other factors that could affect the information contained herein.


Copyright © 2024, Ernst & Young LLP.


All rights reserved. No part of this document may be reproduced, retransmitted or otherwise redistributed in any form or by any means, electronic or mechanical, including by photocopying, facsimile transmission, recording, rekeying, or using any information storage and retrieval system, without written permission from Ernst & Young LLP.


Any U.S. tax advice contained herein was not intended or written to be used, and cannot be used, by the recipient for the purpose of avoiding penalties that may be imposed under the Internal Revenue Code or applicable state or local tax law provisions.


"EY" refers to the global organisation, and may refer to one or more, of the member firms of Ernst & Young Global Limited, each of which is a separate legal entity. Ernst & Young Global Limited, a UK company limited by guarantee, does not provide services to clients.


Privacy  |  Cookies  |  BCR  |  Legal  |  Global Code of Conduct Opt out of all email from EY Global Limited.


Cookie Settings

This site uses cookies to provide you with a personalized browsing experience and allows us to understand more about you. More information on the cookies we use can be found here. By clicking 'Yes, I accept' you agree and consent to our use of cookies. More information on what these cookies are and how we use them, including how you can manage them, is outlined in our Privacy Notice. Please note that your decision to decline the use of cookies is limited to this site only, and not in relation to other EY sites or Please refer to the privacy notice/policy on these sites for more information.

Yes, I accept         Find out more