Sunnyvale, CA -- (SBWIRE) -- 01/09/2012 -- (Sunnyvale, CA) – The Brazilian Government recently announced new amendments to taxes on financial transaction regulations, which includes reduction of tax on foreign exchange transactions (Impostosobre Operacoes Financeiras – IOF) related to the inflow of resources within Brazil from 2% to zero. The rates are effective as of December 2, 2011.

Zero tax is applicable to the following financial transactions within Brazil:

- Investment in the stock exchange or futures and commodities exchange markets (with the exception of derivative transactions entailing pre-fixed earnings);

- Acquisition of publicly offered shares or subscription of shares, provided that the issuing companies are registered with the stock exchange market for negotiation of shares;

- Acquisition of Private Equity Fund quotas or funds that invest in their quotas, incorporated as per the Securities Exchange Commission (Comissao de Valores Mobiliarios – CVM) rules;

- Liquidation of simultaneous exchange transactions undertaken to bring funds into Brazil for investment in shares that are negotiated within the stock exchange market by way of cancelation of depositary receipts;

- Liquidation of simultaneous exchange transactions for the inflow of funds into Brazil as a result of transfer from the direct investment regime to the portfolio investment regime;

- Acquisition of bonds issued as per Articles 1 and 3 of Law 12,431 (which relates to bonds acquired as of January 1 2011, object of a public offer, issued by non-financial legal entities which are resident outside Brazil –with exception of residents of tax havens) or quotas of investment funds where upto 85% of the portfolio is comprised of debentures issued by legal entities specifically incorporated to implement infrastructure, research and other innovative development projects.

Tax on Credit Transactions

All kinds of credit transactions involving individual borrowers, including transactions related to concession of lines of credit and financed acquisition of non-residential real estate are subject to decreased IOF tax rates of 0.0062% per day (previously 0.0082%). This is effective as of December 3, 2011.

The IOF tax rate of 6 % will be applicable to any other foreign exchange transactions that are not listed above, including simultaneous exchange transactions carried out for the inflow of funds within Brazil for the investment into the financial and capital markets.

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