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Brazilian Federal Supreme Court considers lawful exchange of banking and tax data with the Public Prosecutor's Office


The Plenary Session of the Brazilian Federal Supreme Court (STF) decided that it is lawful to share with the Public Prosecutor's Office and the police authorities, for purposes of criminal investigation, all bank and tax data of the taxpayer obtained by the Federal Revenue Service and the Financial Intelligence Unit (UIF), without the need for prior authorization of the Judiciary. The general repercussion thesis will be discussed next Wednesday (4).

The judgment of Extraordinary Appeal (RE) 1055941 was concluded on Thursday (28) with the opinions of Justices Cármen Lúcia, Ricardo Lewandowski, Gilmar Mendes, Marco Aurélio and Celso de Mello. By majority vote, the appeal filed by the Public Prosecutor’s Office, was upheld to reinstate decision of the first instance against the taxpayers based on data shared by the Revenue Service without prior judicial authorization.

The majority opinion was formed by Justices Alexandre de Moraes (full vote, in portuguese), Edson Fachin, Luís Roberto Barroso, Rosa Weber, Luiz Fux, Cármen Lúcia, Ricardo Lewandowski, Gilmar Mendes and Chief Justice Dias Toffoli, rapporteur of the appeal. Justices Marco Aurélio and Celso de Mello cast the dissenting opinions.

In today's session, Chief Justice Toffoli made adjustments to his initial opinion to fully grant the appeal and restore the decision. Despite mentioning a few specific discrepancies on the matter, Chief Justice adhered to the understanding of the majority, admitting that the Revenue Service may share the entire administrative tax procedure without judicial authorization.

The conclusion of the presentation of the opinions led the Court to revoke the injunction granted by the rapporteur in July, which had determined the national suspension, until a final ruling was made, of all court proceedings and investigations and criminal investigation procedures initiated without prior authorization of the Judiciary on the exchange of detailed data, protected by tax and banking secrecy, by the supervisory and control bodies.

Below, a summary of the votes cast at this Thursday's session.

Justice Cármen Lúcia

Justice Cármen Lúcia believes that there is no irregularity in the full sharing of information obtained legally by the inspection bodies with the Public Prosecutor's Office and the police, when elements of the practice of criminal offenses are detected. According to her, forwarding to the competent authorities of information that reveals the practice of illicit acts does not violate the duty of secrecy, because the fundamental right to privacy and secrecy should not protect citizens from actions of the State aimed at fighting crime.

The Justice pointed out that the Brazilian legislation establishes as a duty for the public officer to inform about any suspicious activities of illicit practices to the competent bodies, in order to allow criminal investigations to be conducted. On the other hand, the law provides for the mandatory observance of confidentiality by the authority that receives the information, and establishes civil and criminal sanctions in case there is misconduct in that regard.

Justice Ricardo Lewandowski

In voting for the full granting of the Appel (RE), Justice Ricardo Lewandowski pointed out that the matter under discussion is similar to the one examined by the Supreme Court in RE 601314, also with general repercussion, when the Full Bench declared the constitutionality of article 6 of Supplementary Law 105/2001 and considered the judicial authorization for the Revenue to collect bank information from taxpayers to be unnecessary. As a result of this decision, the Justice also considered it lawful to transfer the data legally obtained by the Revenue to the Public Prosecutor's Office for criminal prosecution purposes.

According to Lewandowski, this is not evidence obtained illegally or of undue breach of banking and tax secrecy by the Revenue Office, since the agency acted by opening a prior administrative tax proceeding and under the strict terms of the legislation. "Here, it is not considered indiscriminate or random sharing of banking and tax data between the Revenue and the Public Prosecutor's Office, but only transfer or pass-on from that body to this Office of evidence relatEd to the tax evasion of taxpayers for the purpose of determining their criminal liability," he said.

The full vote of Justice Ricardo Lewandowski in Portuguese 

Justice Gilmar Mendes

According to Justice Gilmar Mendes, the Federal Revenue Service should pass on to the Public Prosecution Service all the information necessary to enable the criminal lawsuit and data that demonstrate the amount of the tax owed by the defendant. However, he considers it is not wise to determine in advance which information may be included in the Tax Representation for Criminal Purposes.

In the case of the Financial Intelligence Unit (FIU), the Justice emphasized that the agency has the legal duty to disseminate information. But, according to Gilmar Mendes, the Tax Intelligence Report should be understood as a mere piece of financial intelligence - "as its name makes clear" -, and exactly due to its nature, can not be used as an evidence for purposes of investigation proceedings or criminal lawsuit.

Justice Marco Aurélio

Justice Marco Aurélio cast the dissenting opinion, in favor of the dismissal of the extraordinary appeal because he believes that data secrecy can only be exceptionally removed - for a specific purpose and by court decision - and that a decision against that constitutional provision generates legal uncertainty. "I must bear in mind, above all, not the search, by any means, for criminal liability, but the constitutional commandment," he said.

For the Justice, the Regional Tribunal TRF-3, in the second instance decision object of the appeal, did not go against the Constitution, since, by applying item XII of article 5, it protected the defendants right to secrecy.

Justice Celso de Mello

Justice Celso de Mello also voted to dismiss the appeal. However, he considered it fully legitimate for the FIU to share the content of its financial intelligence reports with the criminal prosecution agencies. Justice also states that the Public Prosecutor's Office and the Judiciary Police have a duty to preserve the confidentiality of the data and information transmitted.
Because of the constitutional guarantees of protection of banking and tax secrecy, Justice Mello believes that the tax representation for criminal purposes, issued by the Revenue Service, should contain only the objective description of the allegedly criminal fact and other information related to the taxpayer, without sending, therefore, documents protected by secrecy, such as bank statements, income tax statements, accounting books and invoices. For the dean, the requirement of prior judicial authorization does not frustrate or prevent the full exercise, by any State agency, of investigative, inspection and punitive powers.

The full vote of Justice Celso de Mello, in Portuguese 


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