Normative Instruction 1,322 (Instrução Normativa 1,322/2012), issued by the Federal Revenue Office and published in the Official Gazette of 18 January 2013, amends the transfer pricing rules for interest payments regulated by Normative Instruction 1,312 (NI 1,312/2012).

NI 1,312/2012 was amended to reflect the new rules set forth by Law No. 12,766/2012, and the effective date (1 January 2013), as the original text was not in line with the law.

For the agreements concluded in 2012, the benchmark for the interest expenses will correspond to the LIBOR rate for US deposits of six months plus an annual spread of 3%.

As of 1 January 2013, the agreements must observe the new rules introduced by Law No. 12,766/2012.

Note: Many companies were questioning whether the new rules would apply retroactively because of the wording of NI 1,312/2012. The new Normative Instruction 1,322/2012 is intended to assure the legal terms to taxpayers.

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