The new Brazilian Forest Code: Call for a truce and for a focus on implementation

In 2012 the new Brazilian Forest Code (Forest Law 12.651) was adopted after a long and exhausting political process. Like most existing laws in Brazil, the Forest Code is not perfect. Consequently, a series of demands for changes and alterations have been raised by, on one side, rural landowners and agribusiness, and on the other the environmentalist sector. Each sector has pursued actions to change the requirements to better reflect their aspirations. These include various claims of unconstitutionality (Ações Diretas de InconstitucionalidadeADIs) raised by the environmental sector, as well as draft law bills, decrees and legal opinions backed by different segments of the agribusiness sector.

Over all of this time, BVRio Institute has been actively working on several fronts to support the implementation of the new Brazilian Forest Code. Based on this experience, we conclude that, regardless of their merits, such demands have resulted in significant delays in implementation of the Code, with resulting negative impacts on the environment and the productive sector.

The following table summarizes the main alterations of the Forest Code proposed by the different stakeholder groups:

Subject Forest Code (FC) Agribusiness demands Environmental demands
Rural Environmental Registry (CAR)1 Deadline for enrollment:
– Originally: 2015
– Extended to 2016
– Extension of the deadline for 1 to 2 years (until 2017 or 2018)2 – Maintaining the deadline of May 2016
Forest Legal Reserves (LRs) – Maintenance of LR required – size varies according to the biome and state3
– A series of exceptions and special cases result in exemptions and reduction of LR obligations
– Possibility of off-farm LR compensation for farms deforested before July 2008
– Possibility of LR restoration with exotic species
– Relaxation of the rules
– Expand the range of exceptions and special cases that reduce LR obligations4
– End of exception and waivers of Legal Reserve requirements5
– Obligation of re-composition of LRs within each property5
– Against the use of off-site compensation mechanisms5
–  Reject the use of exotic species for LR restoration
Permanent Protection Areas (APP)6 – Compared to 1965, the current FC reduces the protection of APPs
– Extends the range of possibilities for intervention (uses) in APPs
– Size of APPs proportional to the size of the farm (the ‘ladder’)7
Further expansion of the range of possibilities for intervention in APPs – Revert the level of protection of APPs to those of the 1965 Forest Law8
– Limits the intervention possibilities8
– Contrary to the ladder8
Amnesties Amnesty of sanctions for areas deforested before July 2008 Maintenance of amnesties Contrary to the amnesty and in favour of sanctions regardless of the 2008 deadline9
Agricultural credit FC does not permit the granting of agricultural loans to landowners not enrolled in the CAR until May 201710 Extension of deadline Oppose the granting of loans for farms not enrolled in the CAR and not in compliance with the FC since its publication in 20129

1The Forest Code establishes that every rural property in the country has to be enrolled in the Rural Environmental Registry (CAR), a georeferenced digital registry connected to satellite images that enables monitoring and mapping of land use in rural properties. The original deadline was May 2015, already extended to May 2016.

2Bills 4550/2016 and 4598/2016 from Congress and Senate Bill 287/2015 propose extending the deadline for enrolment with the CAR by 1 to 2 years (to 2017 or 2018).

3The Forest Code requires that all rural properties in the country maintain a certain amount of land under native vegetation (called “Legal Reserves”). The size of Legal Reserves can vary from 20% to 80% of the property, according to the type of vegetation (biome) and the region in which the properties are located. Specifically, properties with forest cover located in the Amazon region need to hold 80% of legal reserve while properties in other biomes (Atlantic Forest, Cerrado, Pampa, Caatinga and Pantanal) need to keep only 20% of native vegetation. An exception is the case of properties containing Cerrado vegetation located in the Amazon region, which need to maintain 35% legal reserve.

4Several bills (e.g., Law nº 18.295, 10 November 2014, Estado do Paraná; Law nº 15.684, 14 January 2015, Estado de São Paulo), legal opinions (e.g.,http://www.agrolink.com.br/noticias/NoticiaDetalhe.aspx?codNoticia=108912), and publications (e.g., http://www.agroicone.com.br/$res/arquivos/pdf/140305144023_codigo-florestal-brasileiro-e-um-dos-temas-de-discuss%C3%A3o-da-65-reuniao-anual-da-SBPC-2607.pdf, http://dinheirorural.com.br/noticia/artigo/areas-consolidadas-permitem-regularizacao-ambiental-diferenciada; http://www.evaristodemiranda.com.br/postagens/acabou-a-exigencia-de-reserva-legal/) seek to legalize past deforestation based on the dates of previous legislation. In the Legal Amazon, the discussion focuses on laws from 1996 and 2000, and outside the Amazon on laws from 1934, 1965, 1989 and 1991.

5Unconstitutionality claims (Ações Diretas de Inconstitucionalidade) 4901 and 4937, under consideration by the Supreme Court (STF) since 2012.

6The Forest Code establishes the obligation for maintenance of native vegetation in sensitive areas, such as– riverine zones, hilltops, etc., the so-called ‘Permanent Protection Areas’ (APPs). The extent of such areas has been the subject of much negotiation.

7The negotiations related to APPs resulted in a complex step-wise system for determining the size of APPs, dependent on the size of the farm (‘the ladder’ or ‘escadinha’). Most environmentalist groups rejected the adoption of this system.

8Unconstitutionality claim (Ação Direta de Inconstitucionalidade) 4903, under consideration by the Supreme Court (STF) since 2012.

9Unconstitutionality claim (Ação Direta de Inconstitucionalidade) 4902, under consideration by the Supreme Court (STF) since 2012.

10 The original requirement was that farmers that do not comply with the Forest Code as a whole would not be allowed to receive agricultural loans from government banks. The final text of the Law confined this conditionality to enrolment with the CAR system only.

A truce in the disputes and a focus on implementation

Full implementation of the law as it stands would result in a significant improvement of governance related to land use and a substantial contribution to biodiversity conservation and carbon storage at a landscape scale, placing the Brazilian agricultural sector at the forefront of global sustainability. If fully implemented, the Forest Code has the potential to protect more than 150 million hectares of native vegetation in Brazil, storing about 100 Gt CO2 and making a significant contribution to biodiversity protection.

Undoubtedly, the Forest Code contains imperfections, contradictions and inconsistencies, and does not fully represent the aspirations of any stakeholder group. However, the 2012 Law should be seen as the “only deal possible at the moment.” Any process of alteration to its contents could result in tortuous re-negotiations and, at the same time, create precedents for further demands for change. And, in the meantime, the resulting uncertainty serves as an excuse for non-compliance and no enforcement on the ground, as well as for postponing the process of regulation of the law at the state and federal levels.

In the current scenario, the Forest Code still remains mostly on paper. A concerted effort has to be made to ensure its implementation in the field. Demands by both sides for amendments of the law, either to restrict or expand its environmental protection obligations, have resulted in negative impacts on the environment, delays in the its implementation, and a very damaging continuation of legal uncertainty surrounding land use and agricultural production. A truce is needed in these demands, so that the first phase of implementation of the Code can get underway, with all the associated improvements in land management for the country. In the future, once implementation is well under way, revisions can be conducted aimed at improvements of the law, but today this debate is prolonging a process that is detrimental to both the productive sector and the environment.

About BVRio

BVRio Institute (www.bvrio.org) is a Brazilian non-profit association with the objective to develop market mechanisms to facilitate compliance with Brazilian environmental laws. iBVRio was developed in collaboration with different state government agencies (i.e., Amazonas, Pará, Rio de Janeiro, and Acre) and the Association of Environmental Public Attorneys (Abrampa), and established partnerships with a number of civil society organizations. iBVRio is a Climate Action Leader of the R20 Regions for Climate Action initiative, received the Katerva Awards 2013 for Economy, and is a member of the Forest Legality Alliance.