The indemnification of all the affected parties for their suffered losses and damage is a central task in the reparation process of the impacts of the collapse of the Fundão dam. The Inter-Federative Committee (CIF) and the Renova Foundation share a commitment to guarantee those affected a speedy and fair indemnity process, making sure it’s transparent, reliable and equally justified.
At a CIF meeting, held on October 23, 2017, its members decided on the parameters of the indemnities for General Damages of the Compensation and Indemnity Program (PIM).
The indemnity is meant for people who have lost their income (such as sand fishermen, fishermen and other workers in the fishing chain, tourism businesses, farmers and other professionals) or material assets (such as vehicles, residential and commercial properties and rural properties).
Resolutions No. 111 and 119 of the Inter-Federative Committee established that the Compensation and Indemnity Program shall contain 3 components: Moral Damage, Material Damage and Loss of Profit.
The CIF Resolutions also reaffirmed the commitment that the amounts paid to those affected through the Emergency Financial Aid Program will not be discounted, deducted, or compensated by the indemnity amount to be paid by the PIM. Therefore, the Financial Aid will not stop for the indemnified persons who have not yet resumed their economic activities or started a new productive activity.
In addition, the Renova Foundation will refund those who have already been indemnified until October 23, 2017, the amounts that were initially deducted in the calculation from the loss of profit in form of Emergency Financial Aid.
Moral Damage, Material Damage and previous Loss of Profit, calculated from the date of the disaster to the date of the indemnity agreement, shall be negotiated and paid within the same timeframes, as follows:
a) For Campaign 1: finalization of negotiations by December 28, 2017 and payment by March 31, 2018. Participants in this phase are all those registered by March 2017.
b) For Campaign 2: finalization of the negotiations by March 31, 2018 and payment by June 29, 2018. Participants in this phase are all those registered by October 2017.
In case the affected persons could not pick up their original or other economic activities yet, there will be a periodic payment of the Loss of Profit amount with partial discharge signed by the impacted person until the return of the activities.
Regarding the incidence of taxes on the indemnification payments, no taxation will be levied on the amounts of Moral Damages and Material Damage, but the Loss of Profit is taxed by the Federal Revenue Service.
CIF Resolution No. 119 established that in the indemnification process there should be no discrimination of origin, race, sex, color, age or any other form of discrimination. For example, female workers who performed the same job as men and/or earned the same income cannot be paid a lower indemnity. In addition, those impacted who are not represented by a lawyer in the indemnification process are entitled to free legal assistance, to be provided by the Renova Foundation. Regarding the indemnity, the impacted may choose to join the Indemnification Policy proposed by the Renova Foundation or by proofing damages, and may choose the one that is more favorable.
To view the full resolutions, go to: