Brazil Central Bank Autonomy May Be Voted By Chamber After Carnaval

RIO DE JANEIRO, BRAZIL – The bill proposing Central Bank (BC) autonomy may be passed in the Chamber of Deputies after Carnaval. This is expected by deputies who attended, on Thursday, February 6th, a meeting with the president of the Central Bank, Roberto Campos Neto, at the bank’s headquarters.

Complementary Bill 200/1989 grants the Central Bank technical, operational, administrative and financial autonomy. The government’s Central Bank autonomy bill, submitted last year to Congress, was appended to the one now being analyzed by the Chamber.

After the meeting, the MDB party leader in the Chamber, Deputy Baleia Rossi, said that the report of Deputy Celso Maldaner had been submitted to the President of the Central Bank at the meeting and that next week meetings with the legislators are scheduled to “clarify and show the importance of the Central Bank’s autonomy bill”.

“After this round of visits by the president of the Central Bank and Deputy Celso Maldaner to all the political parties, we can vote on this measure after Carnival,” said Baleia Rossi, upon leaving the Central Bank’s headquarters. The Deputy explained that this deadline for voting was set by Chamber president Rodrigo Maia and party leaders.

The bill’s rapporteur also expects its passing in plenary session after Carnival. “There has been talk for 30 years about Central Bank autonomy. All developed countries have such autonomy, which will certainly help greatly, providing stability for national and international investors,” said Celso Maldaner.

Mandate

The bill provides four-year terms of office for the president and directors of the BC. The mandate of the bank president will begin on March 1st of the second year of the Brazilian President’s term of office. In the case of directors, two shall be replaced each year of the President’s term of office.

In order to make the transition, the bill establishes that the current president of the Central Bank and two other directors shall remain in office until February 28th, 2024. Two directors shall remain in office until February 28th, 2023, two more until February 28th, 2022, and a further two until February 28th, 2021.

Upon passing the law, the Central Bank will no longer be tied to the Ministry of Economy. The bill also provides for the establishment of the National Financial System Development Fund, which will allow revenues collected by the Central Bank from the provision of services and systems for regulated institutions to be administered by the agency.