DE-EARMARKING OF STATES REVENUES (DRE): THE CASE OF STATE-OWNED COMPANIES

Abstract

The debates on the scope and limits of the so-called De-earmarking of States Revenues (DRE), an important tool of fiscal management, gain special relevance due to the argument, built by state-owned companies, in the sense that art. 76-A of the ADCT would not affect the revenues collected by them. In such context, based on legislative and doctrinal research, this article has two objectives. Initially, this article builds on legal hermeneutics in order to clarify the concept of "current revenue" used by the transitional constitutional provision. In doing só, this work seeks to define the extent to which DRE could affect the revenues collected by state-owned companies, especially the dependent ones. Then, this article analyzes the impacts of DRE on the corporate governance of state-owned companies as a whole, thus including both public companies and mixed-capital companies, either dependent or not. In the end, this article concludes that, although legally possible in the case of dependent public companies, DRE should be prevented from affecting independent state-owned companies. This article also concludes that the application of DRE should be severely mitigated with regards to dependent mixed-capital companies, in accordance with the corporate governance principles provided for in Brazilian legislation, especially accountability, transparency and absence of conflicts of interest.