The 1st Panel of the Superior Court of Justice, in the judgment of the Appeal in Special Appeal No. 1,492,971/SP, unanimously decided that ITBI is applicable to transactions involving the incorporation of real estate by Real Estate Investment Funds (FIIs). In the case in question, the funds acquired real estate through management institutions. In exchange, they offered “shares” of the fund to the former owners.
The Special Appeal was filed by real estate funds against a ruling by the Court of Justice of São Paulo, which argued that the entities that actually purchase the property are the managing institutions, which then hold fiduciary ownership of the property to guarantee payment of a debt. Considering also that real estate funds do not have legal personality and the assets of the fund and the managing company are not interconnected, according to Law No. 8,668/1993, there would be no transfer of ownership of the property for consideration, which is a taxable event for ITBI (tax on the transfer of real estate).
However, the City of São Paulo argued that the incorporation operation was onerous, since there was an offer of shares in exchange for the transfer of the property. In addition, it also stated that immunity in the incorporation of ITBI related to the incorporation into the assets of a legal entity for the purpose of realizing capital was not possible, since the legal entity could not have a predominantly real estate activity.
The rapporteur of the case at the STJ, Min. Gurgel de Faria highlighted that the acquisition of property to compose the assets of Real Estate Investment Funds (FIIs), when carried out directly by the fund administrator and obtained through the issuance of new fund shares in favor of the sellers, results in the transfer of ownership of the property for a fee, attracting the incidence of ITBI.
Along the same lines, Min. Benedito Gonçalves, who supported the rapporteur's vote, stated that the shareholders of real estate investment funds, even if they are the owners, cannot exercise real rights over the real estate. Given that the transferor ceases to possess the attributes of ownership, which are now exercised by the condominium of shareholders of the fund, through the administrator, who records its fiduciary ownership in the real estate registry.
Although it is not binding, since it was not a case subject to the repetitive appeals system, we understand that the judgment of AREsp No. 1,492,971/SP becomes an important precedent that can be replicated in decisions of lower courts, as long as they deal with an identical issue. Considering that the incidence of ITBI was considered legal in this case, the decision may discourage the adhesion to real estate funds and property transfer operations that transfer shares of the funds in exchange.
The tax team will continue to monitor the issue until the STJ's case law is eventually standardized, and is available for any clarifications that may be necessary.
