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For higher consideration.
Brasilia,
/Eivany Antonio da Silva/
Assistant Secretary of * * * [the Brazilian IRS]
I agree with the above Opinion, which I approve.
For the consideration of the Minister of Finance.
Brasilia,
/Luiz Romero Patury Accioly/
Acting Secretary of * * * [the Brazilian IRS]
R. Foreign Lenders' Efforts During the Phase III Negotiations To
Have the Central Bank Issue Them DARF's in Other Situations Not
Covered in the March 1984 Brazilian IRS Ruling
During the phase III negotiations, a number of foreign lenders
sought to have the Central Bank issue them DARF's with respect to
all of its net loan interest remittances to them, and not just on
its restructuring debt interest remittances during the relending
periods of the DFA's and the CGA's. The Brazilians rejected these
efforts to have the Central Bank issue DARF's to the foreign
lenders in additional situations outside the scope of the
borrowers-to-be theory employed in the March 1984 Brazilian IRS
ruling to the Central Bank. However, the Brazilians did indicate
some willingness to negotiate a longer relending period with
respect to the proposed phase III DFA.
On January 5, 1985, the Brazilians submitted their written
comments to a proposed draft of certain phase III basic business
terms that had been prepared by the BAC. Their comments with
respect to the Central Bank's provision of DARF's were as follows:
WITHHOLDING TAX RECEIPTS
In the first place, Pricing and Withholding Tax Receipts
are intimately linked and shall be dealt with altogether.
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