New Law on Promotion of Development and Production of Modern Biotechnology and Nanotechnology

On December 28, 2022, the National Government published in the National Official Gazette Decree No. 853/2022 (the “Decree”), which approves the regulations (the “Regulations”) of Law No. 26,270 “Development and Production of Modern Biotechnology” and its amending Law No. 27,685 “Promotion of the Development and Production of Modern Biotechnology and Nanotechnology” (both “the Laws”).

The Laws define biotechnology as: “any technological application that, based on rational knowledge and scientific principles from biology, biochemistry, microbiology, bioinformatics, molecular biology and genetic engineering, uses living organisms or parts derived therefrom to obtain goods and services, or for the substantial improvement of productive processes and/or products” and nanotechnology as “any technological application of the set of techniques and sciences in which materials, substances and devices of nanometric dimensions are studied, manipulated and obtained in a controlled manner, which present special properties granted exclusively by their size of less than one hundred nanometers (100 nm) in one or more dimensions”.

The Regulation establishes that those who access the promotion regime may obtain benefits of accelerated amortization of income tax in one installment, early refund of value added tax (“IVA”) and the granting of a tax credit voucher corresponding to 50% of the expenses paid for research and development services contracted with institutions of the National Public System of Science, Technology and Innovation.

Article 1 of the Regulation stipulated that the following shall be considered promoted actions:
1.The execution of scientific and technological research projects aimed at the productive development of modern biotechnology and/or nanotechnology;
2.The execution of biotechnological and/or nanotechnological research and development projects focused on technology transfer;
3.The development of new technologies, products, services, processes and/or productive improvements within the modern biotechnology and/or nanotechnology sector;
4.The incorporation of modern biotechnology and/or nanotechnology throughout the production process and/or;
5.Social, environmental and productive impact analysis in the implementation and/or incorporation of new technologies, products and processes in the biotechnology and/or nanotechnology sector.

For the granting of benefits, the Regulation establishes that a call for projects will be made and will be made effective through the actions provided by the authority, which, in turn, will establish the procedure for the analysis of the projects and the selection mechanism. If a project is approved, it will be registered in the National Registry for the Promotion of Modern Biotechnology or in the National Registry for the Promotion of Nanotechnology, depending on the nature of the project.

The Regulations regulate the infringements to the Laws, among which are the lack of accreditation and/or presentation of the required documentation in the form and/or terms established by the Authority of Application or the lack of veracity of the same, the lack of maintenance of the requirements demanded to obtain the benefit or benefits and the abandonment of the approved project without a notification that justifies it.

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