The legal framework at the federal level for the determination of environmental violations and sanctions is regulated by Federal Decree No. 6,514/2008, which has undergone several amendments since its enactment, also modifying the mechanisms for closing administrative sanctioning proceedings before the Brazilian Institute of the Environment and Renewable Natural Resources (“IBAMA”, Brazilian Federal Agency).
According to the regulation, once the occurrence of an environmental violation/infraction is verified, IBAMA has the prerogative to impose the applicable penalties, commonly through the issuance of a Notice of Infraction1. Upon formal notification, the fined party may choose to submit an administrative defense, should it wish to challenge the infraction, or to choose one of the legal solutions available for the termination of the proceeding.
The so-called legal solutions constitute alternative mechanisms for resolving the pecuniary penalties imposed by IBAMA, enabling the administrative proceeding to be concluded more swiftly. These include:
- payment of the fine, with a discount applied to the updated amount of the penalty;
- conversion of the fine into environmental services, either directly or indirectly, aimed at the preservation, improvement, or recovery of environmental quality; and
- installment payment of the fine amount, in which case no discount is granted.
Although these forms of termination are not new, there has been significant changes in the procedure for adopting such alternative solutions, particularly regarding the payment of fines.
Prior to the most recent regulatory amendments, when the fined party opted for immediate settlement of the fine, it was sufficient to (i) pay the payment slip issued together with the Notice of Infraction, or (ii) formally request the issuance of a payment slip from IBAMA, followed by payment. Upon payment of the fine, the administrative proceeding was deemed concluded.
This simplified practice provided fined parties with a lower-cost and more agile pathway, while simultaneously allowing the federal environmental authority to reduce the number of infraction proceedings pending decision, reallocating human resources to other fronts, in addition to generating increased revenue.
With the legislative changes implemented as of 2023, adherence to the legal solution consisting of payment of the fine is no longer associated with a unilateral act by the regulated party but rather has become a more complex procedure dependent on administrative approval.
Under the current regulatory framework, should the fined party wish to pay the fine, it must formally express its intent to adhere to the legal solution through payment by submitting a formal request to IBAMA, expressly waiving the right to submit its administrative defense and confessing the debt, so that the federal environmental authority may initiate its assessment of the feasibility of the intended solution.
In addition, consolidation of the fines has become a mandatory stage of this process, encompassing the assessment of the occurrence of penalty aggravating factors, such as recidivism.
The table below summarizes the main changes resulting from the new legislation:
| Previous Scenario: Payment with Immediate Closure | Current Scenario: Succession of Steps for Adherence to the Legal Solution |
- Payment of the fine with a 30% discount, through a payment slip (i) issued together with the Notice of Infraction, or (ii) requested, provided that payment is made within five (5) days. - Payment of the fine results in the immediate settlement of the obligation and the filing of the administrative sanctioning proceeding, formally closing the matter. | - The fined party must formally declare on the case records its intention to adhere to one of the legal solutions, with an irrevocable and irreversible confession of the debt. - IBAMA will consolidate the amount of the fine, assessing potential aggravating factors, and will confirm the feasibility of applying the chosen legal solution to the specific case. - The fined party is granted a period to submit comments regarding potential aggravating circumstances of the penalty, such as recidivism. - A decision is rendered on the final consolidation of the fine following any challenge submitted by the fined party. - Payment of the consolidated fine. - Closure of the administrative proceeding. |
All of these stages may consume a significant amount of time, resulting in delays in the conclusion of the sanctioning proceeding, contrary to what would be expected when opting for payment of the fine.
This occurs because, although Federal Decree No. 6,514/20082 and Normative Instruction No. 19/2023 (“IN 19/2023”) establish a thirty (30)-day deadline for a decision, IBAMA’s assessment regarding the feasibility of adherence to the legal solution and the consolidation of the fine amount almost never complies with such deadline, as is also the case with other administrative sanctioning proceedings initiated by IBAMA.
Under this new scenario, the fined party is required to await the conclusion of the prior administrative assessment for consolidation of the final fine, which may be increased by aggravating factors, in addition to being subject to monetary adjustment until its effective payment.
Furthermore, the new system has also allowed aggravating circumstances that should have been assessed prior to the issuance of the Notice of Infraction, such as recidivism or obstruction of inspection activities, to be considered only during the analysis of the request for adherence to the legal solution. This often includes infractions issued after the adherence request, thereby increasing legal uncertainty and impacting the regulated party’s financial planning.
Therefore, we understand that the amendments introduced by Federal Decree No. 6,514/2008, specifically with respect to the legal solutions, run counter to what is expected from the Administration guided by efficiency and proportionality.
For regulated parties, the scenario is characterized by increased bureaucracy, heightened legal uncertainty, and financial risk, which inevitably tends to reduce the incentive for voluntary payment of penalties.
- Risk of delay in the analysis of requests for adherence
- Possibility of penalty aggravation
- Need to challenge aggravating factors within the administrative sphere
- Incidence of monetary adjustment until the effective payment
- Consideration of unpaid fines for purposes of recidivism in potential future infractions
For IBAMA, the consequence may be a reduction in the volume of proceedings closed through immediate settlement, accompanied by an increase of ongoing proceedings and a potential diversion from IBAMA’s core mission: to oversight of potentially polluting activities and the prevention of environmental damage.
- Article 2. Any action or omission that violates the legal rules for the use, enjoyment, promotion, protection, and recovery of the environment, as set forth in Section III of this Chapter, shall be considered an environmental administrative offense. ↩︎
- Article 124. Whether or not a defense is offered, the adjudicating authority shall, within thirty days, judge the infraction report, deciding on the application of penalties. ↩︎