RELIVRE Reaffirms Federal Authority Over Natural Gas Commercialization in Brazil
The Ranking of the Free Gas Market (RELIVRE), an initiative led by IBP, ABPIP, and ABRACE, with support from 11 other associations representing the country’s main natural gas consumers and transporters, supports the court decision that suspended the enforceability of the Public Services Oversight Fee (TFSD) established in the state of Pernambuco.
Developed in 2022, RELIVRE monitors the evolution of Brazilian state regulations regarding the free natural gas market, aiming to encourage regulatory improvements by providing enhancement suggestions and enabling comparisons with other regulations. A key topic of discussion within RELIVRE is the normative provision for the collection of oversight fees on natural gas commercialization, which includes the TFSD instituted in Pernambuco.
Based on the rationale supporting the court’s sound decision, RELIVRE understands that oversight fees should not be permitted in state legislation related to natural gas commercialization. Oversight of natural gas commercialization occurs at the federal level (ANP), and this function should not be duplicated at the state level.
Currently, only five of Brazil’s 27 federative units provide for such oversight fees, and not all effectively implement them, signaling the need for a coordinated adjustment of this distortion, common before the recent liberalization of the natural gas market.
Thus, the suspension of TFSD in Pernambuco not only restores legality but also aligns with the proper development of Brazil’s natural gas market, reducing costs and ultimately promoting competition as a driver for increased use of the resource, contributing to the country’s desired energy transition.
RELIVRE expects that the decision will be upheld, benefiting not only local public interest but also serving as an important example for other states that still impose the fee, encouraging adjustments and moving toward abolishing the requirement.
To learn more about RELIVRE, click the link: https://relivre.com.br/
