Provisional Measure (MP) number 70 detailing the rules for foreign investment in media companies was published over two weeks ago in the Federal Register (Diário Oficial da União) and hasn?t even been discussed by the special joint committee set up to examine the executive order?s constitutionality, urgency, relevance, and financial adequacy, among other aspects. Earlier this year, Congress passed a constitutional amendment to Article 222 and called for the Government to submit enabling legislation. Instead of sending a complete bill, the Executive issued MP 70. The committee was also supposed to examine amendments submitted by members of both houses. No chairperson was appointed and the rapporteur, Deputy Arolde de Oliveira (PFL, Rio de Janeiro), did no work. Time has run out, so the original rapporteur has been replaced by Dep. Robson Tuma (PFL, São Paulo). Now the measure will be debated directly on the floor of the lower house. Dep. Tuma promises to write his report next week, when Congress reconvenes after the elections. If a vote isn?t taken on MP 70 in both houses by November 16, no other business can be processed.
Tight deadline
When MP 70 was issued by the Executive branch we warned that tight deadlines might not allow enough time for Congress to have a proper debate, especially during general elections. The measure is important for several reasons aside from the specific question of foreign investment. It waives the restrictions in Decree 236/67 on equity holdings of less than 20%. It also allows institutional investors to hold equity in any number of media companies provided no single holding exceeds 20% and provided they can?t vote or appoint board members.
?Radicals?
Two leading members of the Workers Party (PT), Deps. Walter Pinheiro (Bahia) and Luciano Zica (São Paulo), submitted amendments to MP 70. No one else bothered. The PT is concerned to keep barriers to foreign control and cross-ownership in place. Dep. Pinheiro has threatened to seek a court order declaring MP 70 unconstitutional. He and some colleagues on the PT?s hard left have been criticized as ?radicals? in the media for publicly stating this position. Their fears may now prove well-founded, however, since the measure could pass without debate. Furthermore, unless Congress discussed the legality of equity and other transactions concluded in accordance with the measure during the intervening period, any such deals would automatically be deemed valid. Dep. Pinheiro was opposition leader in the lower house when the amendment to Article 222 was being negotiated with the majority. As he has recalled in several recent interviews, back then the Government promised to submit draft legislation for a full debate.
