BMA Review 91: Earn-Outs in M&A, New Financing Structures for Mining, Environmental Licensing, and More

This edition of BMA Review, our quarterly publication, features articles by our lawyers on legal and regulatory developments affecting businesses and investors in Brazil. The topics covered include the use of AI in legal due diligence, new financing structures for the mining sector, expected developments in labor litigation this year, and the ICC's Highly Expedited Arbitration procedure.

The cover article examines earn-out provisions in M&A transactions, a mechanism that defers part of the purchase price and ties payment to the achievement of financial or operational targets after closing. It also discusses recent case law and practical lessons for structuring these arrangements.

This issue also explores Brazil's new General Environmental Licensing Law, developments in the tax treatment of contingent payments in M&A transactions, the Taxpayer Defense Code and the concept of the habitual defaulter, and aimed at expanding financing options for the mining sector.

Click on the titles below to read the articles that interest you, and please contact us if you have any questions.

_TAX

Brazil’s New Taxpayer Defense Code and the Habitual Defaulter

By Rodrigo Taraia, Caio Toschi and Paula M. Bardella

Corporate groups should pay especially close attention. Complementary Law 225/2026 provides that entities related to the debtor taxpayer can also be classified as habitual defaulters. Moreover, the ratio between a taxpayer’s debt and assets – which forms part of the legal test for substantial default – can be affected by asset revaluations and provisioning, potentially triggering classification as a habitual defaulter, even in the absence of new tax debt.

_{ENVIRONMENTAL, CLIMATE AND MINING}