With the measures, the federated bodies are able to anticipate revenues and avoid the risk of not receiving debts; the sale may be made to private individuals or investment funds regulated by the CVM
BRASILIA-A Room approved this Tuesday 4th a complementary bill which frees the securitization of the active debt of the Union, the States, the Federal District and the Municipalities, that is, it allows the federated entities to sell the right to the credits they must receive, of fiscal or less.
There were 384 votes in favour, 59 against and one abstention. The project, signed by the former senator Jose Serra (PSDB-SP), had already passed the Senate and now goes to the president for sanction Luiz Inácio Lula da Silva.
With securitization, states are able to anticipate revenues and avoid the risk of not receiving that money. The assignment of credit rights can be made to private individuals or to investment funds regulated by art Securities and Exchange Commission (CVM).
“Debt securitization represents an important innovation for the fiscal management of Brazilian states and municipalities that will guarantee the advance of revenues that public entities would only partially receive, in the long term, or, in many cases, not receive any resources at all” , says MP Alex Manente (Cidadania-SP), rapporteur of the text, in his opinion.
“Although there are doubts in the market about the validation parameters of good payers and the associated risks, the benefits outweigh the challenges. Experience from other countries, such as the United States, shows that granting discounts on debt collection can lead to a greater collection”, corrects the parliamentarian.
According to the project, the operation will have to preserve the nature of the original credit, maintaining its guarantees, updating the credits and payment conditions. The proposal also establishes that half of the revenue obtained by states and municipalities from securitization must be allocated to financing social security and the other half to public investments.
“Increasing available resources through asset debt securitization is important for federal entities that may eventually face fiscal difficulties and need urgent investments,” says Alex Manente.
“And, above all, we cannot forget that allocating 50% of income to Social Security will help reduce the deficits of the social security system, contributing to the sustainability of pensions and pensions, vital for the economic security of millions of Brazilians”, we read in another excerpt from the report.
The speaker further stated that the transfer of credits to private investors creates new business opportunities, stimulates the financial market and promotes the development of the economy. “Investors tend to be interested in assets that have good return potential, especially in a low interest rate environment.”
Source: Terra
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