Environmental and land legislation puts pressure on producers everywhere

Brazilian rural producers are under pressure from opposite directions, as if they were being pulled in a tug of war. In the environmental area, in addition to being charged with legislation that is among the most restrictive in the world, they live under constant threat of boycott by NGOs, environmentalists and European countries, if they dare to convert new areas to agriculture.

On the other hand, if they do not use at least 80% of the productive potential of their land, they are subject to expropriation for the purposes of agrarian reform. The scenario gained worrying contours after a recent decision by the STF, which concluded that productive property is subject to expropriation if it is not fully fulfilling its social function – which also involves criteria porous to subjectivism such as “appropriate use of natural resources” and “ exploitation that favors the well-being of owners and workers”.

In other words, if you open the land you will be boycotted and fined; If it does not open, the property may fall into the “fine land mesh” as supposedly unproductive.

The decision of the country’s highest court relativizes Article 185 of the Constitution, which expressly declares that productive property, as well as small and medium-sized rural properties, “are not susceptible to expropriation for the purposes of agrarian reform”. In reaction to the STF, the Parliamentary Agricultural Front (FPA) called for urgency in the consideration of bill 4,357/2023, by deputy Rodolfo Nogueira (PL-MS), which reaffirms the prohibition on expropriating productive lands.

Paradox between environmental and land laws

The former president of the National Institute of Colonization and Agrarian Reform (Incra) in the government of Jair Bolsonaro, Geraldo Mello Filho, says that the paradox of land legislation versus environmental legislation brings legal uncertainty to the countryside: “If, on the one hand, environmental policies defend If the preserved areas are increased, or encouraged to do so, land legislation punishes”.

The situation would worsen in the Amazon region, where it is common for landowners to apply for a license to deforest within what is permitted by law, and the State does not respond. “The State simply does not respond, then years pass, the person is unable to open and, when they are unable to open, they are subject to this unproductivity. And if you decide to open, even within the limits of legality, that is, opening within what you could if you had a license, you will receive a fine”, he explains.

The question was posed by People’s Gazette for Incra: a property with a surplus Legal Reserve that could be converted to agriculture – maximizing the use of land – but does not do so, is it likely to be fined and question the fulfillment of its social function?

Incra confirms risk of expropriation

Incra responded: “The property in these conditions is susceptible to expropriation under Law 8629/93. If the owner’s interest is to preserve beyond the legally required minimum, he can register the surplus as a legal reserve or create/register a Private Natural Heritage Reserve (RPPN), which is processed with the state environmental agency. Legally protected/preservation areas are not included in the GUT calculation.”

In other words, if they do not register their surplus vegetation as a Legal Reserve or transform them into RPPN, the producer actually runs the risk of having the preserved land expropriated.

Incra’s understanding, however, can be challenged in light of the Payment for Environmental Services Law (Law 14,119/2021), approved by Congress and sanctioned by then president Jair Bolsonaro. Article 24, item V, added as “not usable” for the agricultural potential of a property the areas with remnants of effectively conserved native vegetation that are not protected by environmental legislation and that are not part of any economic exploitation project.

In theory, at least, producers can argue that they maintain the social function of the land, even with a percentage below 80% of use. Because the complementary law considered it possible for the owner to maintain a native area voluntarily, without being punished for it.

Brazil is a protagonist in global food security

To ensure global food security, the world expects Brazil to continue to increase food production. A projection by the United States Department of Agriculture points out that the country has “ample reserves of land and water and many arable areas with potential for use.” The country is expected to add 20 million hectares to production by 2031, a growth of 2.6% per year, which should result in 76% more grain production and 41% more oilseed production, compared to 2021.

These estimates, however, do not take into account possible political interference. For producer Antonio Galván, president of the Brazilian Soybean Producers Association (Aprosoja), the biggest concern is legal uncertainty, aggravated by STF decisions and leftist animosity from the government. “What is this 80% land use? Are they from the area that has already been converted? Or is it 80% of what you own? They don’t have a clear rule. Brazil’s problem is legal security”, he complains.

The topic of the social function of land, which had been dormant for several years, has now been taken up by the STF in a highly politicized context, notes lawyer Rafaela Parra, a specialist in agrarian law. She assures, however, that some producers have already presented their defense to Incra, citing the new regulation of the Law of Payment for Environmental Services, which authorizes the maintenance of surplus green areas on the property, without this being considered non-use of the 80 degree. % of land use.

What can help overcome this paradox between what environmental and land legislation require is the expansion and maturation of the carbon credits market. The monetization of green areas preserved by producers would have the potential to deflate the debate about fulfilling the social function of property.

Lawyer points out risk of injustice with those who preserve

“New projects will emerge, from an environmental and preservation point of view, which must be considered when calculating the productivity of these areas, because they will be generating carbon credits, for example, or because they will be suitable for payment projects for environmental services. Therefore, they will have to enter into the productivity calculation of these areas, under penalty of committing injustice in the interpretation of the legislation. Now, if the 80% is correct, fair or not, then we enter into a conflict that is up to the Legislature”, assesses Parra.

Jurist Daniel Vargas, coordinator of the Bioeconomy Observatory at Fundação Getulio Vargas (FGV), summarizes the dichotomy experienced by producers. “On the one hand, it is an environmental NGO and a European country threatening the Brazilian owner who opens the property to be more productive. If you deforest, even if the law authorizes it, you cannot sell it. On the other hand, it is social NGOs and national leaders who threaten the producer with expropriation if he does not use the property in full. If it is ‘too productive’, it cannot sell. If it is ‘less productive’, it could lose the land. Everything, interestingly, in the name of the public interest”, he emphasizes.

Government encourages opening land, government punishes opening land

It is not new that the Brazilian government treats farmers in a contradictory way. In the 1970s and 1980s, settlers who were attracted by the military government to the Amazon were encouraged to open at least 50% of the entire area of ​​their properties, under penalty of not obtaining land titles.

With the advent of the Forest Code, in 2012, the requirements went in the opposite direction, and native environmental preservation (Legal Reserve) became mandatory in 80% of the area of ​​properties in the Amazon biome, 35% in the cerrado areas located in the Legal Amazon and 20% in other regions of the country. Rural producers, in any case, remain under bipolar pressure: they have to preserve as much as possible and exploit as much as possible, simultaneously.