The Brazilian government yesterday confirmed that property investors in the country may be banned from owning land. In the announcement, foreign real estate investors interested in owning land in the Brazil might face tougher restrictions as the Brazilian government clamps down on land ownership over food security concerns.
As such, buying land in the country could become virtually impossible for foreign realty investors if the new laws come to pass. Under the regulations currently being formulated, foreign investors already owning land in Brazil or with large rural properties and have set up Brazilian companies are at risk of having their title deeds annulled if the tough measures are enforced, the government reiterated. Brazilian government officials reiterated the country’s official policy over foreign land ownership, saying that foreigners should not be allowed to buy or own agricultural land.
According to the Agrian Development Minister, the Brazilian government intends to tighten land restrictions on foreign ownership of farm lands in Latin America’s biggest country. Denise Mantovani, the Ministry’s spokeswoman, confirmed the published statements by the Minister, outlining the decision to restrict foreigners from buying agricultural land in the country.
According to the Ministry, official government policy forbids foreigners from producing food in Brazil, saying that it was president Luiz Inacio Lula da Silva’s policy due to concerns over food security that require Brazilian land to be wholly owned by Brazilians, the Minister said.
About 10 million acres of land had been registered by foreigners in the year 2008 and in the period 2002 to 2008, foreigners invested $2.43 billion to buy land in the Country, added the spokeswoman. She further reiterated that the government’s decision to toughen foreign land ownership in the country is necessitated by the increasing demand for food, water and natural resources globally.
Currently, the law dictates that large rural properties can only be purchased by Brazilian citizens or residents but the laws have been largely overlooked. Foreigners seeking realty investments in the country overlook the regulation and set up companies normally controlled from overseas, for buying land. The government wants to control such foreign companies, said Mantovani.
As such, various ministries are currently preparing a constitutional amendment to implement further land ownership restrictions on foreign investors, including the cancelling of title deeds, warned the spokeswoman. The legislation, if successfully passed, will make it clear that foreign investors can invest in any other sector in the country except land, Mantovani concluded.
25 June 2010.