Bill (PL) No. 2,780/2024: National Policy on Critical and Strategic Minerals is approved in the Chamber of Deputies

On Wednesday (May 6), the Chamber of Deputies approved Bill (PL) No. 2,780/2024, which establishes the National Policy on Critical and Strategic Minerals (PNMCE – Política Nacional de Minerais Críticos e Estratégicos) and creates a new regulatory framework for the sector. The text, authored by Representative Zé Silva and reported by Representative Arnaldo Jardim, consolidates several proposals on critical minerals, rare earths, and inputs essential to the energy transition and to industrial development.

With the Plenary’s approval, the Bill was sent to the Federal Senate, where it will continue to move through the legislative process. The proposal is a meaningful step toward aligning Brazil with global strategies focused on supply chain security and on enhancing the value of strategic mineral resources.

Key Concepts

The Bill defines critical minerals as those needed for key sectors of the national economy whose supply is, or may become, at risk because of supply chain limitations, and whose scarcity could seriously affect the country’s economy—particularly in supporting the energy transition, ensuring food and nutritional security, and safeguarding national sovereignty in strategic sectors.

Strategic minerals, by contrast, are defined in the Bill as those that are relevant to the country due to significant reserves and that are essential to the economy for generating a trade surplus, supporting technological development, or reducing GHG emissions in the relevant production chain.

A notable innovation is the concept of urban mining, defined as the systematic process of collection, disassembly, separation, processing, and refining aimed at recovering critical and strategic minerals contained in urban anthropogenic stocks, such as electrical and electronic waste, batteries, and end-of-life vehicles.

Governance: National Council for the Industrialization of Critical and Strategic Minerals (CIMCE)

The Bill creates CIMCE as a body linked to the Office of the President, with up to 15 representatives, including the States, Municipalities, the private sector, and higher education institutions. Its key responsibilities include:

• defining and updating the substances classified as critical and strategic minerals, with reviews every four years in line with the Multiyear Plan;
• approving changes in the corporate control of companies holding mining rights;
• preparing the National Plan for Critical and Strategic Minerals; and
• defining the projects considered priorities under the PNMCE.
• Control over Corporate Transactions. M&A and Minerals Supply Agreements

A point of particular importance for mergers and acquisitions and offtake contracts is Article 3, paragraph 2 of the Bill, which requires Executive Branch approval—through CIMCE and the National Mining Agency (ANM)—of the following transactions, by means of the screening mechanism:

• any change of corporate control, direct or indirect, including through corporate reorganization, of a company that holds mining rights related to critical and strategic minerals;
• access to geological information of strategic interest or the relevant participation or significant influence of foreign legal entities in companies holding mining rights;
• international contracts, agreements, or partnerships involving the supply of critical and strategic minerals on terms that may affect the country’s economic or geopolitical security; and
• the sale, assignment, or encumbrance of mining titles owned, directly or indirectly, by the Federal Government.
• It is worth noting that the terms “approval” (“homologação” in Portuguese) and “screening mechanism” were introduced through amendments to replace the expression “prior consent” used in the original version of the rapporteur’s report. The provision still lacks clarity, particularly because it does not set out the criteria – or even the guidelines and principles – that will inform the Executive Branch’s decisions, which contributes to legal uncertainty in the sector, at least until specific implementing regulations are issued.

In practice, this provision creates a screening mechanism for investments in the critical minerals sector that should be factored into due diligence and the structuring of M&A transactions involving mining rights in Brazil. It is also worth noting that the mechanism may be triggered not only by transactions involving foreign investment, but also by transactions between domestic groups. In addition, commercial arrangements for the supply of minerals may be subject to the mechanism when they are deemed—again at the Executive Branch’s discretion—to be structured on terms that may affect the country’s economic or geopolitical security.

Approval of the Bill also comes amid an active market debate about the balance between development tools and legal certainty. While the Bill seeks to put a national policy in place and to close regulatory gaps—long cited as an obstacle to financing and to attracting investment—there are concerns about a potential expansion of governmental discretion over governance and strategic transactions in the sector.

In this context, the central role assigned to CIMCE and ANM, together with the approval requirement for certain transactions, may—depending on how it is implemented—introduce additional uncertainty for investors. The challenge will be to ensure that these mechanisms serve their strategic purpose without undermining the predictability that long-term mining projects require.

Economic Instruments and Tax Incentives

The Bill establishes the following instruments of the PNMCE:

Mineral Activity Guarantee Fund (FGAM)

The Federal Government is authorized to create FGAM and to invest as a shareholder up to R$2 billion. The fund’s purpose is to provide guarantees for projects tied to the production of critical and strategic minerals. FGAM will be private in nature, with assets segregated from those of its shareholders, and will not carry any government guarantee or backing. Income earned by the fund is exempt from IRPJ and CSLL.

Compulsory contribution to FGAM and RD&I

Companies in the sector must allocate, each year, a portion of their gross operating revenue (net of taxes): for the first six years, 0.3% to RD&I and 0.2% to the payment of FGAM quotas; thereafter, 0.5% to RD&I.

Federal Program for the Processing and Transformation of Critical and Strategic Minerals (PFMCE)

A CSLL tax credit of up to 20% of expenditures on beneficiation, mineral processing, and urban mining, capped at R$1 billion per year between 2030 and 2034, awarded through a competitive selection process.

Incentivized debentures

The rules of Law No. 12,431/2011 and Law No. 14,801/2024 will apply to the sector for raising funds for priority mineral processing and transformation projects, with an annual revenue cap of R$5 billion for eligibility.

REIDI

The Bill expands the beneficiaries of the Special Incentive Regime for Infrastructure Development to cover mining, processing, mineral transformation, and urban mining of critical and strategic minerals.

Investment Partnership Program (PPI)

Research, mining, processing and mineral transformation projects are now part of the PPI.

Low Carbon Mineral Certificate (CMBC)

The Bill creates the CMBC on a voluntary basis to certify mineral production with lower carbon intensity based on life-cycle analysis, with the goal of facilitating access to green markets and financing. The regulator will need to provide for interoperability and alignment with international standards.

Auctions of Mineral Areas and Mining Rights

Areas with potential for the production of critical and strategic minerals must be prioritized in ANM auctions. Unencumbered areas, or those resulting from the extinction of mining rights, must be auctioned within a maximum of two years; otherwise, they will be open to application under the priority regime. The exploration permit will have a non-extendable maximum term of 10 years, after which the mining right will lapse if the Final Exploration Report has not been submitted to ANM.

Streaming Contracts and Private Mining Royalties

Another notable innovation is the authorization to record, with ANM, private streaming contracts and mining royalty arrangements tied to duly granted mining rights. The recording will have erga omnes effect and will allow specific performance in case of default, and the recorded contracts may be used as collateral in lending or financing transactions.

Traceability

The Bill establishes a supply chain traceability system with mandatory registration of all transactions and parties involved, covering material composition, environmental impact, durability requirements, and circularity data. The system may use distributed ledger technology (blockchain) or equivalent.

Next Steps and Conclusions

Now that the Bill has been sent to the Senate, the text may still undergo adjustments, but it already signals significant structural changes for the sector. CIMCE must be formally established and its structure regulated by the Executive Branch within a maximum of 90 days from the date the law is published.

Ultimately, the Bill’s advancement to the Senate comes at a time when Brazil is seeking to position itself more competitively in the global race for critical minerals, which are essential to industries such as batteries, renewable energy, and digital technology. The effectiveness of the future policy will depend, to a large extent, on the ability to turn geological potential into economically viable projects, which requires a predictable, bankable regulatory environment aligned with international best practices.

From a market standpoint, the Bill reflects a broader trend: the effort to combine industrial policy tools (such as tax incentives, financing, and certification) with control mechanisms over assets considered strategic. The success of this model will depend on its ability to strike the right balance, avoiding both regulatory gaps and levels of intervention that could undermine the attractiveness of the investment environment.

In addition, the consolidation of multiple legislative proposals on the topic reinforces the view that there is still room for structural adjustments in the design of the policy, particularly with respect to institutional coordination and the definition of objective criteria for applying the tools it provides.

In short, the Chamber’s approval of PL No. 2,780/2024 marks a milestone in the reorganization of Brazilian mineral policy, with the potential to reshape how projects are structured, financed, and operated in the country. Given this new landscape, companies and investors are well advised to begin analyzing the regulatory, corporate, and tax implications, particularly for M&A transactions and for the structuring of projects and financing strategies.

Our multidisciplinary Mining team is closely following the Bill’s progress in the Senate and is available to discuss the specific impacts of the proposal in greater depth and to help define legal and regulatory strategies suited to this new environment.