In December, the Ministry of Economy announced a public consultation regarding the manufacture of air conditioners in the Manaus Free Trade Zone. “To have access to the tax exemptions of the Free Trade Zone, the manufacturers need to comply with certain criteria and include national content in the equipment – the so-called basic product process, or BPP. The consultation was about this BPP starting to operate through a points system, whereby if the companies reached a certain number of points, they would obtain the exemptions,” says Larissa Rodrigues, project and product manager at the Instituto Escolhas.

This was a request by the Kigali Network, in its understanding that any flexibility in the rules for national content would favor the manufacture of more efficient equipment. Another positive point of the text submitted for consultation was the acquisition of more points if the energy efficiency was higher. The surprise, however, came on December 22, when the public consultation was canceled just before Christmas, contravening any principle of transparency. Although there were controversial points in the wording, a public consultation operates exactly in this way: resolving problems appropriately with all the involved actors.

The Kigali Network, with signatures of representatives from Idec, Escolhas, iCS, IEI and the Healthy Hospitals Project, sent a letter addressed to the Minister of Economy, Paulo Guedes, requesting official explanations about the reasons for the cancellation and the forecast for when new public consultation would be held on the BPP of this equipment. Here is an excerpt from the letter:

“We were concerned to receive the news of the cancellation of Public Consultation no 67, dated December 1, 2020, regarding the request to alter the basic production process (BPP) of split air conditioners produced in the Manaus Free Trade Zone, as established by SDIC/SEPEC/ME ordinance no 25,268, dated December 18, 2020.

As highlighted in several opportunities and contributions to the process, the consultation is essential because it places the energy efficiency of the equipment to be produced in the free zone as a criterion for the manufacturers of this equipment to obtain and/or maintain tax benefits.

Some contributions submitted to the aforementioned public consultation recommend that the producers of more efficient equipment should have greater weight in these criteria, with an emphasis on those with inverter technology, which provides savings of up to 60% in energy consumption in relation to conventional air conditioners.”