Brazil's oil royalty revenues will be shared amongst non-producing states despite legal challenge.
Brazil's controversial new oil revenue law has finally been implemented, but still faces legal challenge after the oil producing states filed appeals against it with the country's Supreme Court.
The legislation stunned many industry analysts around the world, when it was announced at the end of 2012, only to be vetoed by the country's President to avoid political meltdown. Prior to the law, only the three top producing states - Rio de Janeiro, Espirito Santo and Sao Paulo - benefited from oil revenue. The revenue law means the royalties will now be spread among all of Brazil's 27 states. However, the three states contend the legislation is unconstitutional because it breaches existing production contracts.
Rio de Janeiro alone stands to lose $1.7bn in 2013 as a result of the law, endangering preparations for the 2014 World Cup and the 2016 Olympics.