Cabotage gains new incentive with cost reduction

The Federal Government reduced the import tax for vessels destined for cabotage operations in Brazil. With this, the expectation is to reduce by 40% the cost to import a specific vessel for this segment. The measure is part of ‘BR do Mar’, a plan that aims to boost maritime cargo transportation along the Brazilian coast.

Today, the import tax rate for vessels is 14%. But with the plans to encourage cabotage, which should be revealed with the disclosure of the BR do Mar, the issue has been analysed by the Foreign Trade Chamber (Camex), which approved the elimination of the tax.

The measure was announced and celebrated by the Minister of Infrastructure, Tarcísio Gomes de Freitas. For him, the Government’s decision is “a huge nod to those who are willing to invest in the sector, create jobs, move the entire production chain and contribute to expand the participation of the cabotage matrix in Brazil’s transport matrix”.

For port consultant Fabrizio Pierdomenico, the measure is also welcome. “This is the first step in making cabotage an important modal. I always say that it competes directly with the road mode. So as long as it is not cheaper, faster, more efficient, more competitive with freight and road documentation, cabotage will be at a disadvantage”.

On the other hand, the consultant points out the risk of the measure having side effects. The idea, according to Pierdomenico, is that the tax exemption lasts from 12 to 24 months.

“The problem is to stop using Brazilian shipyards to manufacture these vessels. But I don’t see how not to do that in the short term”, said the expert. He points out that the measure is valid since, “if the intention is to give a supply shock in lines, it is necessary to have ship”.

Other measures

Pierdomenico believes that BR do Mar has to resolve other issues to boost cabotage. One of them is the issue of bunker oil, the fuel of navigation, considered one of the obstacles to the development of the modal. “The bunker represents a huge cost. There has to be different treatment for cabotage”, he said.

The BR do Mar may be published through a bill or a Provisional Measure (MP).The idea is that ships carrying cargo through cabotage will have a differentiated treatment, which can guarantee a reduction in bureaucracy and agility compared to long-haul shipping, which will not have a revision of standards and regulation.

UAE Tederal Tax Authority extends the Excise Tax

On the 1st of October 2017, the Federal Tax Authority (FTA) implemented an Excise Tax on certain products, including 100% on both tobacco-related products and energy drinks and 50% tax on carbonated drinks.

Due to the success of these taxes in reducing the consumption of these products, the FTA, as per Cabinet Decision No (52) of 2019, has chosen to extend this Excise Tax, as follows:

  • 100% on any liquids used in electronic smoking devices and tools, regardless of it containing nicotine, in accordance with the Customs Codes as determined by a decision issued by the Finance Minister;
  • 100% on any electronic smoking devices and tools, regardless of it containing tobacco or nicotine, in accordance with the Customs Codes as determined by a decision issued by the Finance Minister; and

50% on any sweetened drinks, including any products to which sugar or other sweeteners are added and produces:

  • ready-to-drink beverages;
  • concentrates, powders, gels, extracts or any form that can be converted into a sweetened drink;
  • any type of sugar determined under Standard 148 of the GCC Standardisation Organisation under the heading “Sugar”; and
  • any type of sweeteners determined under Standard 995 of the GCC Standardisation Organisation under the heading “Sweeteners Permitted in Food”.

Products which will be exempt from the definition of sweetened drinks and therefore not subject to the new Excise Taxes include:

  • ready-to-drink beverages containing at least 75% milk;
  • ready-to-drink beverages containing at least 75% milk substitutes;
  • baby formula, follow up formula or baby food;
  • beverages consumed for special dietary needs, as determined under Standard 654 of the GCC Standardisation Organisation under the heading “General Requirements for Pre-packaged Foods for Special Dietary Use”; and
  • beverages consumed for medical uses as determined under Standard 1366 of the GCC Standardisation Organisation under the heading “General Requirements for Handling of Foods for Special Medical Purposes”.

The expansion of the Excise Tax on the additional products shall take effect on the 1st of December 2019.

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Statement from Navy Authority regarding the recent Oil Spill

Below is the recent statement given by the Brazilian Navy Authority:

“From the joint and coordinated work between the Brazilian Navy and the Federal Police, with the support of national and foreign institutions, it was possible to advance the investigations into the cause of the appearance of oil spills that reached the northeastern shores, since August 30.

Studies carried out by the Navy Hydrography Center, together with universities and research institutions, made it possible to determine an initial area of possible occurrence of oil disposal, guiding the initial research efforts.

From this initial area, and with data on maritime traffic obtained from the Integrated Maritime Safety Center (CISMAR), the Brazilian Navy reached a number of 1,100 vessels, with a subsequent refinement of 30 tankers.

At the same time, the Federal Police (PF), through geointeligence, identified a satellite image of July 29, related to an oil spill located 733.2 km (about 395 nautical miles) east of the state of Paraíba. This image was compared with images from earlier dates where no spots were identified.

The oil collected on the shore of the north-eastern coast has been subjected to various analyses in laboratories that have proven to originate from oil fields in Venezuela.

This information was supplemented by verification of other parameters such as cargo, port of origin, travel route and shipowners’ information.

Of the 30 suspected vessels, a Greek-flagged tanker was navigating the spot, on the date considered, carrying crude oil from Venezuela’s “SAN JOSÉ” to South Africa. Satellite images, associated with the above data, point this ship as the prime suspect.

CISMAR’s follow-up attests that the vessel kept its monitoring systems powered (Automatic Identification System – AIS) and there was no communication to the Brazilian Maritime Authority about the spill in question.

During the investigation, vessels that did not transmit their location systems (AIS), known as “Dark Ships”, were also evaluated. However, after verification of satellite images, they were not correlated with this occurrence.

Investigations continue to identify the circumstances and factors involved in this spill (whether accidental or intentional), the dimensions of the original oil spill, as well as to measure the volume of oil spilled, to estimate the likelihood of residual oils, and to ratify the pattern of spill observed dispersion.

The unprecedented occurrence required the establishment of its own research protocol, requiring the integration and coordination of different organisations and sectors of society.

The Brazilian Navy, the Federal Police, and other collaborators will continue to conduct the investigation until all issues involved are clarified”.

New Efforts to Boost Dubai’s position for Commercial Arbitration

The newly formed board of trustees of the Dubai International Arbitration Centre (DIAC) held its first meeting earlier today at Dubai Chamber of Commerce Industry’s head office where it discussed new plans and efforts to boost Dubai’s position as a global centre for commercial arbitration.

The meeting comes after H.H. Sheikh Mohammed bin Rashid Al Maktoum, Vice President and Prime Minister of the UAE and Ruler of Dubai, issued a decree related to DIAC, an initiative of Dubai Chamber, which established the centre’s new board of trustees.

The board is joined by legal experts and business leaders, while UAE nationals represent 80% of new members.

The meeting was chaired by Dr. Ahmed Hassan Mohammed bin Al Sheikh, Chairman of the Board of Trustees, and attended by Dr. Ahmed Saeed bin Hezeem Al Suwaidi, the board’s Deputy Chairman; and board members Saeed Mohammed Al Shared Al Falassi; Ahmed Saeed Majed Belyouha; Ahmed Mohammed Ali Al Rashid; Jehad Kazim; Dr. Hassan Mohammed Arab Darwish; Abdulaziz Mohammed bin Shafaar Al Marri; Graham Kenneth Loufit; and Robin Joy Abraham.

During the meeting, board members thanked H.H. Sheikh Mohammed bin Rashid Al Maktoum, Vice-President and Prime Minister of the UAE and Ruler of Dubai, for his trust and confidence in the new board which has been tasked with enhancing Dubai’s reputation as a preferred destination to settle commercial disputes.

Dr. Ahmed bin Al Sheikh pointed out that the new board offers a wealth of legal and business expertise which will enhance its ability to meet the evolving demands of Dubai’s maturing business community, and stressed the important role of commercial arbitration in advancing the emirate’s global appeal as an attractive place to do business. He added that the board is in the process of developing new plans and strategies in line with Dubai’s ambitious vision and sustainable development goals, adding that its efforts would help boost investor confidence in the market.

For his part, H.E. Majid Saif Al Ghurair, Chairman of Dubai Chamber, described DIAC as the leading commercial arbitration centre in the Middle East and North Africa, offering a high calibre of arbitration services and facilities applying best international practices in settling commercial disputes.

H.E. Al Ghurair, expressed his confidence in the board of trustees’ ability to achieve its objectives, raise arbitration standards and improving ease of doing business in Dubai.

The Dubai International Arbitration Centre (DIAC), the largest arbitration centre in the Middle East, provides local and international business communities with commercial arbitration services. DIAC was initially established by the Dubai Chamber of Commerce and Industry in 1994 as the Centre for Commercial Conciliation and Arbitration.

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Argentina Trademarks non-use Cancellation and Invalidation actions

On October 10, 2019, Resolution No. 279/2019 was published in the Official Bulletin establishing the administrative procedures for the non-use cancellation and invalidation actions in connection with trademarks, as well as the applicable official fees.

This new procedure shall be in force in sixty (60) days as from the date of the publication of this resolution:




Focused on IP

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Wholly responsive to clients needs based on the firms large local and international IP experience and expertise, in order to satisfy the IP community requirements in a new scenario of a globalised world following the premises of reliability, quality, efficient action, adaptability to price tailoring and flexibility, with equal emphasis in customised and personalised services.

The firm handles clients of different areas: food, winery, technology and telecommunications, pharmaceutical, entertainment, clothing and textile; among others.

The broad experience of O’Conor & Power’s team in the management of local and international IP portfolios in Argentina and in the region, makes O’C & P a superior “one stop resource”, as Latin American increasingly factors into the world economy.

We are also qualified to protect and enforce clients IP interests through transactions, dispute resolutions, litigation, border enforcement measures and unfair competition related actions.

Our professionals and staff regularly participate in seminars and conferences nationally and internationally, thus keeping updated on the latest IP legal developments in Argentina, Latin America and throughout the world.

Regulatory Update for the UAE Insurance Authority

The UAE Insurance Authority has recently published new regulatory directions on their website. Sharing a summary of the regulatory guidance.

a. Insurance Authority Resolution No. (49) of 2019 Concerning the Regulations for Life Insurance and Family Takaful Business

Previous editions have highlighted the irregularity in both commissions and payments, particularly in relation to pay-out to intermediaries. It was noted in the previous draft, that the commission cap for pure protection policies would be 10% of the annual premium for each year of the term of the policy. This continues to be retained, with the overall cap of 160% of the annualized premium. As for single premium policies, it remains to be limited to a maximum of 10% of the premium. With any premium changes, the pricing actuary must consider non-recurring changes in the annualized premium, due to add-on coverages, riders or similar options, by using the same method and restrictions as the first-year annualized premiums.

With regards to indemnity commission, the commission paid must be based on the annualized premium collected. In circumstances where the mode of premium payment is semi-annually, quarterly or monthly, the commissions paid can be based on the annualized premium. However, this must be financed by the company and not by the policyholder. Affirmed by the previous draft, the first year of commissions paid on the annualized premium must be capped at 50% of the annualized premium or at 50% of the total commissions payable under the product, depending on whichever is less. In circumstances where it is found that the premium payment is of 20 years or more, the pricing actuary may propose a non-fixed payment plan, subject to prior approval.

b. Insurance Authority Board of Directors’ Decision No. (40) of 2019 Concerning the Amendment of Certain Provisions of the Insurance Authority Board Decision No. (3) of 2010 On the Instructions Concerning the Code of Conduct and Ethics to be Observed by Insurance Companies Operating in the UAE (“the Code of Conduct”).

This decision extends the applicability of the Insurance Authority’s Code of Conduct to “insurance-related professions”. The Code of Conduct provides the various terms and conditions that must be complied with by any entity licensed by the Insurance Authority, including but not limited to guidance on operations, publicity and advertisement, pricing, proposal form, policy wording, claims and renewal. In its original form, the application of the Code of Conduct was limited to only the insurance companies licensed by the Insurance Authority, but following this amendment, the Code of Conduct also applies to all professionals licensed by the Insurance Authority, such as Insurance Agent, Actuary, Insurance Broker, Surveyor or Loss Assessor, Insurance Consultant or any other insurance-related profession regulated by the Insurance Authority.

c. The Insurance Authority Board of Directors’ Decision No. (41) of 2019 Concerning the Supervisory Rules for the Experimental Environment of Financial Technology in the Insurance Industry

This decision issued by the Insurance Authority has laid down the financial technology regulatory framework of the Insurance Authority, which the objective “to define the regulatory framework for the operation and management of the experimental environment of the insurance sector, in order to create an attractive environment for the insurance sector using innovative systems, as well as, making it a platform to interact with FinTech companies, improving the regulatory framework, and contributing to economic growth and risk management.”

The decision is aimed at supporting the Emirati FinTech companies and transforming the UAE insurance market into a smart insurance market. The decision identifies Innovative Solution Owners, FinTech companies licensed in free zones and financial free zones, National fintech companies and Foreign FinTech companies. If the applying entity fulfils all the requirements laid down by the Insurance Authority, they shall be accepted for the pilot phase, which will run between 6 to 12 months, aimed at testing the feasibility of the business. This is a great forward-looking step by the Insurance Authority, which will likely result in the development of indigenous solutions in the insurance sector, and has set a high benchmark for other insurance regulators in the region.

d. The Insurance Authority Board of Directors’ Decision No. (42) of 2019 On the Amendment of Certain Provisions of the Insurance Authority Board of Directors’ Decision No. (13) of 2018 Instructions Concerning Marketing Insurance Policies through Banks (“the Bancassurance Regulations”)

This decision amends certain provisions of the Bancassurance Regulations. The Bancassurance Regulations currently require the Designated Officer of the bank to acquire practical training of no less than two months at any insurance company, which has now been replaced by a training requirement of 30 (thirty) hours.

The requirement for an insurance company to have a branch in the Emirate in which the bank is selling the insurance policies has now been replaced by a requirement to have a “Point of Sale” in such Emirate or “electronic services” that enable customers to communicate with the company to receive their feedback, inquiries and complaints, subject to the terms in the revised provision. This implies that insurance companies can utilize the Bancassurance channel for distribution even in the Emirates where they do not have an Insurance Authority licensed “Branch” if they have either a “Point of Sale” in such Emirate or provide insurance services through electronic means.

e. Administrative Decision No. (140) of 2019 Concerning Exemption of Some Insurance Policies from Arabic Language Drafting Condition

The Administrative Decision (the Decision) issued by the Insurance Authority dated 14 October 2019 has now been published on the Authority’s website. The Decision follows the Administrative Circular No 7 of 2019 relating to Administrative Fine, which laid down the fines applicable if an insurer does not comply with the requirement of issuing the insurance policy in Arabic. Following multiple requests from the Insurers who expressed their inability in translating policies of international nature to Arabic language, the Decision lists down the polices which have been exempted from translation to Arabic, such as marine and aircraft policies, oil and gas related insurance policies, space related insurance policies and other insurance policies of international nature. The Decision further provides a list of documents that need to be submitted to the Authority for approval of the policy wordings, in relation to each life insurance policies and those in relation to general insurance policies. In addition, there is a requirement to provide an undertaking that the product complies with applicable legislations.

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