18/01/2021
This is not the first time that the issue has reached the Plenary of the Federal Supreme Court (STF). The issue of reciprocal immunity, a constitutional provision expressed in article 150, section VI, item "a", has already been the subject of discussion on other occasions. The central point of the controversy is in defining the scope of the rule, that is, whether the application of immunity would be restricted to the public entity, or could be expanded in favor of companies that provide predominantly public services, as is the case of mixed-capital companies.
What is being discussed in the case at hand is the recognition of reciprocal immunity to the State Housing and Urban Development Company (CDHU). The First Panel of the STF even stated, in the terms of the judgment of RE 1,274,295/SP, of August 31, 2020,
that the said constitutional immunity would be “extendable to public companies and mixed economy companies providing essential public services“.
Recently, the ministers of the STF unanimously recognized the existence of general repercussions of the matter. Theme 1122, therefore, will now be addressed on its merits and may, as a result, have a significant impact on several other cases judged by the Supreme Court.
It is clear from the analysis of case law that, on some occasions, the STF has seen fit to recognize the extension of reciprocal immunity regarding IPTU to companies that, although private in nature, provide essentially public services. However, it is possible to observe a disagreement in case law between the STF Panels, since in identical cases, divergent decisions have already been issued regarding the merits.[1]
In this context, there has already been discussion as to whether the existence of profit would be sufficient to remove reciprocal immunity or whether, on the other hand, the analysis would be based on the preponderance of the exploitation of a public service, even if there was profit, with this second thesis prevailing in some judgments.
At another time, a new obstacle was imposed on the scope of reciprocal immunity for private capital companies. In Theme 508 of general repercussion, the STF established that the participation of private capital in a mixed economy company that aims to make a profit would be an obstacle to the classification of reciprocal immunity.
It should be noted that the topic gives rise to much debate and, as it involves such subjective elements, requires interpretation so that the criteria can be determined, specifically regarding the definition of essentiality, as well as the characterization of public and private service.
[1] “INTERNAL APPEAL IN THE EXTRAORDINARY APPEAL. TAX. FISCAL EXECUTION. RECIPROCAL IMMUNITY. ARTICLE 150, VI, A, OF THE FEDERAL CONSTITUTION. EXTENSION. PUBLIC COMPANIES AND MIXED ECONOMY COMPANIES PROVIDING ESSENTIAL PUBLIC SERVICES. SETTLED JURISPRUDENCE IN THE STF. APPEALED JUDGMENT IN HARMONY WITH THE GUIDANCE OF THIS SUPREME COURT. INTERNAL APPEAL DISMISSED.” (RE 1,274,295-AgR, Rel. Min. Luiz Fux, First Chamber, DJe of 9/18/2020) – our emphasis
“REGIMENTAL APPEAL IN EXTRAORDINARY APPEAL WITH APPEAL. TAX LAW. RECIPROCAL TAX IMMUNITY. MIXED ECONOMY COMPANY THAT DOES NOT PERFORM PUBLIC SERVICES ON AN EXCLUSIVE BASIS. IMPOSSIBILITY. PRECEDENTS. 1. According to the jurisprudence of the STF, in order to ensure the guarantee provided for in art. 150, VI, a, of the Federal Constitution, it is not only required that the state-owned company provide an essential public service, but also that the service be provided on an exclusive basis. 2. In casu, CDHU (Companhia de Desenvolvimento Habitacional e Urbano do Estado de São Paulo), as a mixed-capital company dedicated to the construction of affordable housing, does not provide a public service on an exclusive basis, given that programs for access to social housing are open to several contractors and financial agents that operate in the civil construction segment. 3. Procedural appeal that is denied.” (RE 1,274,304-AgR, Rel. Min. Edson Fachin, Second Panel, DJe of 11/16/2020,) – our emphasis
