Brazil Senate clears hurdle for foreign ownership of rural land

SAO PAULO (Reuters) - The Brazilian Senate unexpectedly approved a bill late on Tuesday to facilitate the purchase and leasing of rural properties in Brazil by foreign nationals or foreign companies.

The legislation must be approved by the lower house of Congress before the president can sign it into law.

If passed, the legislation could attract investments in agriculture and other sectors such as wind and solar energy farms, along with mining.

According to the bill, foreign ownership can account for no more than 25% of the territory in an municipality, and foreign owners must use the land to “fulfill a social function.”

The senator who proposed it has publicly said he hopes the law would attract some 50 billion reais ($9.8 billion) in new investments per year to Brazil. Its approval in the upper house comes as the government of right-wing President Jair Bolsonaro pushes to further open the economy to private investment.

In the case of intended land purchases in the Amazon region, the new law would require final clearance from the National Defense Council.

($1 = 5.13 reais)

Reporting by Gabriel Araujo; Writing by Ana Mano; Editing by Richard Chang