Regulatory uncertainty in AI affects data center mergers and acquisitions

The expansion of artificial intelligence is usually discussed from the perspective of algorithms, generative models and applications that have been transforming different sectors of the economy. For those who work structuring operations involving data centers, however, the most interesting change may be less in technology and more in the way in which regulatory uncertainty has become part of negotiations and the structure of contracts themselves.

This transformation stems from a simple fact: every application of artificial intelligence depends on computational capacity installed in data centers. Compared to traditional cloud computing, AI requires much more powerful servers, greater processing power and significantly higher energy consumption. In other words, there is no expansion of artificial intelligence without a proportional expansion of the physical infrastructure that supports it.

09/07/2026

Bet of R$ 3.50 made in Curitiba leads to R$ 1.8 million on Lotofácil

09/07/2026

Singer Bonnie Tyler, of hit 'Total Eclipse of the Heart', dies at age 75

09/07/2026

Bonnie Tyler dies at age 75; see repercussion

---

CANAL NO WHATSAPP

Not by chance, the world is experiencing a race for investment in data centers. The global cycle of mergers and acquisitions (M&A) in this segment intensified throughout 2025, driven by the need to expand installed capacity to meet the growing demand for artificial intelligence applications.

The numbers help to measure this demand. The International Energy Agency estimates that global electricity consumption by data centers will practically double by 2030, from around 460 TWh to approximately 945 TWh, a volume higher than Japan's annual electricity consumption.

Top Cifras

Toque agora.

1 Augusta, Angélica e Consolação Tom Zé

2 Rock And Roll In The Hay Brad Cotter

3 Fake Amor Melody

4 Paraíso Danilo Santos

In this context, Brazil occupies a strategic position. The country brings together characteristics that few markets can offer simultaneously: a predominantly renewable electrical matrix, relatively competitive energy costs, submarine cable infrastructure that strengthens its international connectivity and availability of areas for new developments. Added to this is the fact that it is estimated that a significant portion of Brazilian digital loads are still processed abroad, which highlights a broad potential for internalizing this demand.

However, this potential coexists today with a factor that has started to appear recurrently in negotiations: regulatory uncertainty. The Special Taxation Regime for Datacenter Services (Redata), designed to encourage investments in the sector, lost its regulatory basis with the expiration of Provisional Measure No. 1,318/2025, in February this year. Since then, Bill No. 278/2026 has remained pending in the Senate, while relevant discussions persist on the possibility of granting tax incentives in an election year and on the legal treatment of investments made during the term of the provisional measure.

This environment naturally requires greater caution from investors. But recent chronology demonstrates that regulatory insecurity alone has not been enough to keep capital away. The acquisition of Elea Data Centers by I Squared Capital, one of the largest operations announced in the sector in Brazil, was announced in April, a few months after the loss of effectiveness of the provisional measure, accompanied by an explicit strategy to expand the platform in the Brazilian market. What uncertainty changes, in practice, is not the willingness to invest, but the way in which certain risks are evaluated, priced and distributed between the parties.

This reality is already noticeable in the due diligence phase. In operations involving data centers, the legal analysis continues to cover asset ownership, real estate regularity and other aspects traditionally examined in an M&A operation, but begins to devote increasing attention to the energy contracting structure, the conditions for connection to the electricity grid, compliance with the counterparts required by incentive regimes and the preservation of tax benefits whose maintenance depends on continued compliance with certain requirements.

This set of factors also influences the pricing of the asset and the negotiation of declarations and guarantees, bringing regulatory risk closer to the center of the economic dynamics of the transaction.

The same logic is reflected in the operation documentation. Regulatory and tax risks no longer necessarily represent an obstacle to investment and become the subject of contractual allocation. Conditions precedent may link the closing of the transaction to the implementation or maintenance of certain regulatory requirements; price adjustment mechanisms or contingent price portions (earnouts) can be associated with the delivery of energy capacity or the achievement of targets relevant to the enjoyment of incentives; and specific indemnity clauses may regulate liability for any liabilities related to the applicable tax regime.

This is because a data center represents much more than a real estate asset or a set of technological equipment. The investor is acquiring connection capacity to the electrical grid, contracted energy, connectivity, licenses, strategic contracts and a certain regulatory position. All of these elements directly influence the economic value of the investment and need to be carefully reflected in the legal structure of the operation.

Redata itself offers a concrete example of this dynamic. As the maintenance of tax benefits depends on continued compliance with the counterparts provided for by law, under penalty of demanding taxes plus interest and fines, the acquisition of a project already qualified for the regime may also mean assuming the risks associated with preserving this benefit, depending on the structure adopted for the transaction.

Evidently, there are risks that cannot be completely eliminated by contract. Legislative changes, public policy changes or structural limitations of energy infrastructure will continue to be subject to the regulatory environment. Still, recent experience shows that investors do not usually wait for this scenario to completely stabilize before investing. The challenge becomes identifying these risks, pricing them and distributing them appropriately between buyer and seller.

Brazil brings together objective attributes to consolidate itself as one of the main digital infrastructure hubs in Latin America. The consolidation of the regulatory framework will certainly help to accelerate this movement. Until then, legal security will continue to be built not only by the legislator, but also by the quality of the contractual structures that support each operation.

In a sector as capital-intensive as data centers, the ability to allocate risks efficiently can be as relevant to the investment decision as the availability of energy or the quality of the infrastructure itself. Ultimately, contracts no longer merely fulfill a protective function between the parties and begin to play a decisive role in making investments viable.

* Daphne Minerbo is a lawyer specializing in Corporate Law, contracts, corporate governance, corporate reorganizations and mergers and acquisitions (M&A). Partner at Panucci, Severo e Nebias Advogados, advises national and international clients from various sectors, such as energy, technology, finance, health, industry and retail. She has a bachelor's degree in Law from USP and a postgraduate degree in Corporate Law from FGV/SP.

The articles published by CNN Infra seek to stimulate debate, reflection and shed light on views on the main challenges, problems and solutions faced by Brazil and other countries around the world. The texts published in this space do not necessarily reflect the opinion of CNN Brasil.

Source: CNN