The conversion law of the Gás do Povo Program, the ANP's role, and harmonizing federal and state rules in the LPG market

1. Introduction — a new benchmark for regulatory balance

Converting Provisional Measure 1,313/2025 into law was a significant advance in public policy aimed at giving low-income Brazilian families access to liquefied petroleum gas (LPG), through the Gás do Povo Program.

At the same time, the text approved by Congress faced a sensitive debate: to what extent could legislation govern operational aspects of the LPG market without encroaching on the technical regulation exercised by Brazil's National Petroleum, Natural Gas and Biofuels Agency (ANP)?

The final legislative outcome shows institutional maturity. Congress managed to preserve the program's social purpose while, at the same time, upholding the regulator's technical role — avoiding the rigid codification of matters that depend on constant regulatory updating.

The approved text moved on for consideration and possible sanction by the Presidency and, from a strictly regulatory standpoint, does not, in principle, contain provisions that undermine the ANP's rule-making authority or prevent it from exercising its technical mandate — which contributes to institutional stability in the sector. This balance is essential to ensure legal certainty, competition, and logistical efficiency in a market that reaches nearly every household in Brazil.

2. The logic of technical regulation: the role of regulatory agencies

Modern economic-regulation doctrine recognizes that infrastructure and supply sectors require specialized technical discipline, subject to continuous updating. Leading Brazilian regulatory-law scholars, such as Marçal Justen Filho and Floriano de Azevedo Marques Neto, note that the role of regulatory agencies is to ensure technical stability in complex markets; that operational rules require flexibility for technological and economic adaptation; and that regulatory action must be grounded in technical expertise and public participation.

Under this model, the legislature sets general guidelines while the regulatory agency exercises technical discipline over the sector. In the case of LPG, the ANP regulates cylinder safety, filling and storage standards, product traceability and quality, and the operational requirements for distribution and sale — elements that require constant updating, something incompatible with the rigidity inherent to statutory law.

3. Federal rules and the preservation of the ANP's rule-making power

During the Provisional Measure's passage through Congress, there was concern that rigid operational rules would be written into the law itself, displacing the ANP's technical regulation. The final approved version, however, refers technical matters back to the agency's regulation, particularly regarding the technical compliance of cylinders, sealing, identification and regulatory authorization.

In doing so, Congress reaffirmed an essential principle of the modern regulatory state: technical and operational rules should remain within the regulatory sphere, not be frozen into statute. This legislative choice preserves the ANP's ability to adjust operational rules as technology evolves, to allow for regulatory innovation, to correct market distortions, and to adapt the sector to the country's logistical needs — a clear institutional acknowledgment of the importance of the agency's technical rule-making power.

4. Where federal legislation meets state law

Before the federal law was approved, several Brazilian states had enacted rules aimed at expanding competition and the circulation of cylinders.

Paraná — State Law 20,627/2021. This state law provides that the holder of the trademark stamped on a cylinder cannot prevent competitors from reusing it, allowing cylinders to circulate across brands under certain conditions.

Rio de Janeiro — related state legislation. The State of Rio de Janeiro also adopted legislative and administrative measures aimed at consumer protection and the safe circulation of cylinders, including requirements for identification and requalification standards.

These state initiatives arose in response to local market conflicts and attempts to expand regional competition. However, the Federal Constitution establishes that the national fuel supply is a matter of federal competence, requiring regulatory uniformity to ensure safety and logistical efficiency.

5. What happens now to state laws

With the new federal law in force and technical discipline referred to the ANP, the legal landscape is reorganized: state rules remain valid so long as they do not conflict with federal and regulatory discipline; state provisions that authorize practices incompatible with ANP technical rules tend to be set aside; and states continue to be able to act on consumer protection and local enforcement, but without contradicting the national regulatory regime.

In short, states do not entirely lose regulatory space, but technical matters concerning filling and circulation now depend on national regulation. This avoids market fragmentation and ensures technical uniformity across the country, bringing legal certainty for all investors.

6. Competition, innovation, and the ANP's future role

By preserving the agency's rule-making power, Congress allows sensitive matters — operational circulation of cylinders, exceptional filling authorizations, experimental logistics-innovation projects, competition mechanisms overseen by CADE (Brazil's antitrust authority), and merger, acquisition and divestment transactions — to continue being handled through flexible regulatory instruments. This avoids turning the law into a permanent obstacle to market evolution.

7. Conclusion — an institutional advance

The final text of the law demonstrates the institutional maturity of the Brazilian legislative process. Congress preserved the social program (Gás do Povo); avoided regulatory rigidity; respected the ANP's technical competence; kept room for technical and regulatory evolution; and ensured legal certainty for the sector.

The result is a benchmark for balance between social public policy and technical regulatory governance. In a market that reaches nearly every household in Brazil, preserving the capacity for regulatory evolution is essential to ensure competition, efficiency and supply security. The LPG sector, consumers and the competitive environment itself stand to benefit from this balanced institutional arrangement, in which law and technical regulation act as complements, not competitors.