A body of public prosecutors in the state of Rio de Janeiro (MPRJ) is investigating the legality of fiscal benefits granted by both the state and the city of Rio de Janeiro to ThyssenKrupp-owned slab producer Companhia Siderurgica do Atlantico (CSA). Vale was a former partner at CSA.
The probe will also investigate potential administrative misconduct by the the city and the state of Rio de Janeiro as well as negligence by the two parties for not collecting the needed taxes. The state of Rio de Janeiro faces a financial crisis thanks to a rising public deficit.
The Rio de Janeiro state prosecutors said that both the state and the city of Rio de Janeiro renounced to millions of BRL in revenues since they alleged gave CSA fiscal incentives as well as tax exemptions.
CSA doesn’t have an environmental license to operate, and has been operating through a TAC agreement, in which the steelmaker is expected to meet a series of obligations.
Earlier this month, the Rio de Janeiro state prosecutors filed a lawsuit in an attempt to void the operations of CSA. MPRJ demanded at the time new analysis about the impacts of the mill’s activities to the environment.
A former partner at CSA, Vale sold its stake in the project back to ThyssenKrupp for a symbolic price.