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Client Alert – New guidelines for the Federal Law for Cultural Incentives.

The Brazilian Ministry of Citizenship established new guidelines for the Federal Law for Cultural Incentives No. 8,313/91, also known as the Rouanet Law.

The Law allows taxpayers (individuals or companies) to allocate part of the income tax to support cultural projects, as a donation or sponsorship. In practice, the fundraising for the fostered projects occurs through waiver of tax resources, that are destinated to artistic and cultural productions.

The guidelines were published through Normative Instruction No. 2/2019 of the Brazilian Ministry of Citizenship, which provides procedures to the presentation, receipts, analysis, homologation, execution, monitoring, legal reporting and assessment of results of the cultural projects financed through the mechanisms of the Federal Law for Cultural Incentives.

One of the main modifications in the law is the maximum amount authorized for funding a project, which was of R$ 60 million (approximately USD 15 million) and was reduced to R$ 1 million (approximately USD 200,000). For portfolios of projects (consisting of a set of projects presented by a company or a group with a common partner), the limit was reduced from R$ 60 million to R$ 10 million (approximately USD 2 million). According to the Brazilian Ministry of Citizenship, these measures intend to “improve the distribution of resources and stimulate small and medium-sized cultural producers to submit more projects”.

Audiovisual projects, specifically, will have the following limits: (a) short films: R$ 200,000 (approximately USD 50,000); (b) half-lengths: R$ 600,000 (approximately USD 150,000); (c) TV programs: R$ 50,000  per episode (approximately USD 12,500); and (d) web series: R$ 15,000 per episode (approximately USD 3,750). Audiovisual projects that are contemplated in public calls or have agreements or terms of sponsorship guaranteeing a minimum of 50% of the amount requested as public financing, higher amounts will be admitted, provided that these amounts are in accordance with the standard market price.

Projects related to immaterial and material cultural heritage, such as museums and locations of memory and conservation, as well as projects for the construction and maintenance of theaters and stageplay rooms in cities with a total population of less than 100 thousand are not limited to R$ 1 million. In addition, projects that are fully executed in the North, Northeast and Midwest regions of Brazil will have a maximum amount of R$ 2 million (approximately  USD 500,000), and projects executed in the Southern region, the State of Minas Gerais and the State of Espírito Santo will have a limit of R$ 1.5 million (approximately USD 375,000). The purpose is to encourage the decentralization of fostered cultural projects to outside of Rio de Janeiro-São Paulo region.

The modifications also seek to expand cultural access, as well as to implement social counterparts of training and capacitation. Now, producers benefiting from the Federal Law for Cultural Incentives must promote cultural educational actions to the public benefit, including students and teachers of public educational institutions. In addition, 20% of the tickets of the project must be destined for free distribution with social educational or artistic training nature. In tandem, cultural proposals submitted to incentive funding must present a detailed distribution plan, aimed at increasing the access to cultural projects, goods and services produced.

The Normative Instruction also established a limit of up to 10% of the tickets for free distribution by sponsors, in addition to a limit of up to 10% of the tickets to free distribution by the beneficiary in actions of promotion of the project.

The Normative Instruction No. 2/2019 was published in the Official Gazette of April 24, 2019, with immediate effects, and is available, in Portuguese, at

For further information, please contact us.

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