On June 4 2014, it was published the Decree 8.263/2014 in order to amend the Regulation of the IOF, and to reduce from 360 days to 180 days the minimum average maturity term on foreign loan, whose settlement of foreign exchange transactions is levied by the IOF /Exchange at the rate of 6% (six percent).
In other words, foreign loans with maturity term higher than 180 days settlement will have IOF/Exchange rate reduced to 0%.
This is good news for multinational companies that enter into cross-border loans to finance the operations of their local subsidiaries, since as of June 4, 2014, it will be possible to liquidate the transactions in a shorter term without the impact that of IOF/Exchange.
The measure will apply to transactions entered into as of June 4, 2014.