Legal framework

Domestic legislation

What is the main domestic legislation as regards trade remedies?

The Brazilian legislation regarding trade remedies comprises the following laws and statutes:

  • Decree No. 1,355/1994: enacts the Final Act that incorporates the results of the Uruguay Round of the Multilateral Trade Negotiations of the General Agreement on Tariffs and Trade (GATT 1994);
  • Law No. 9,019/1995: regulates the application of the measures specified in the Agreement on Implementation of article VI of GATT 1994 (Anti-Dumping Agreement) and in the Agreement on Subsidies and Countervailing Measures;
  • Decree No. 1,488/1995: regulates the administrative proceeding concerning the application of safeguards;
  • Decree No. 1,751/1995: regulates the administrative proceeding concerning the application of countervailing measures;
  • Decree No. 8,058/2013: regulates the administrative proceeding concerning the application of anti-dumping duties;
  • Decree No. 8,807/2016: regulates the Brazilian Chamber of Foreign Trade (CAMEX);
  • SECEX’s Ordinance No. 8/2019: regulates the administrative proceeding relative to the public interest analysis with the objective of potentially suspending or altering anti-dumping duties and countervailing measures due to public interest reasons; and
  • SECEX’s Ordinance No. 21/2010: regulates anti-circumvention proceedings applicable to antidumping measures.

Although already in force, SECEX’s Ordinance No. 8/2019 was open for public consultation from 17 April 2019 to 31 May 2019 and thus may still be subject to alterations in its final wording.

The Ministry of Economy (which has incorporated the former Ministry of Industry, Foreign Trade and Services - MDIC) website provides the above-mentioned list of relevant legislation: www.mdic.gov.br/comercio-exterior/defesa-comercial/856-legislacao-defesa-comercial.

International agreements

In general terms what is your country’s attitude to international trade?

Brazil is now in the middle of a shift in its attitude to international trade.

In the last decade, the focus of Brazilian trade policy has been on expanding the Southern Common Market (Mercosur) and strengthening its influence at the multilateral level.

In force since 1994, Mercosur is a regional customs union and trade bloc that currently includes Brazil, Argentina, Paraguay and Uruguay. The main objectives of Mercosur are:

  • promoting the free transit of goods and services between participating countries, by means of eliminating customs duties and non-tariff restrictions, among others;
  • establishing common external tariffs to be adopted before third countries; and
  • coordinating macroeconomic and sectoral policies (eg, international trade, agricultural, monetary and exchange rates) with a view to ensuring proper competition conditions between the participating countries.

Venezuela became a member in 2012, but it was subsequently suspended in 2016 after not complying with its Mercosur membership obligations. On the other hand, Bolivia’s protocol of accession was signed in 2015 and the country is now awaiting the conclusion of its membership process. There are also countries associated with Mercosur (Chile, Colombia, Ecuador, Guiana, Peru and Suriname) that, even though they do not receive the benefits of member countries, are allowed to participate in summits of common interest.

Mercosur is under the purview of the Latin American Integration Association (ALADI), which is a broader agreement that aims to promote integration between Latin American countries. As a result of the participation of Mercosur in ALADI, Brazil has been involved in several trade agreements with ALADI members. Mercosur has free trade agreements currently in force with:

  • Chile (Economic Complementation Agreement - ACE - No. 35/1996);
  • Bolivia (ACE No. 36/1997);
  • Mexico (ACE No. 54/2002 and ACE No. 55/2002);
  • Peru (ACE No. 58/2005);
  • Colombia, Ecuador and Venezuela (ACE No. 59/2005, ACE No. 69/2014 and ACE No. 72/2017);
  • Cuba (ACE No. 62/2007);
  • India (Preferential Trade Agreement - ACP - 2009);
  • Israel (Free Trade Agreement - FTA - 2010);
  • South Africa, Namibia, Botswana, Lesotho and Swaziland (ACP, 2016); and
  • Egypt (FTA, 2017).

The above-mentioned list of agreements can be found at the Ministry of the Economy’s website: www.mdic.gov.br/comercio-exterior/negociacoes-internacionais/796-negociacoes-internacionais-2.

There is also an FTA signed between Mercosur and Palestine, which is not in force yet due to pending ratification. In addition, Mercosur is currently involved in ongoing negotiations for the establishment of FTAs with Canada and Singapore, and has just completed an FTA with the European Union (see question 32).

In addition, Brazil has engaged in the negotiation and adoption of other types of international agreements, especially on the investment facilitation front. Deviating from a traditional bilateral investment agreement, Brazil has entered into agreements on cooperation and facilitation of investments with the following countries: Mozambique, Ethiopia, Angola, Malawi, Mexico, Colombia, Chile, Peru, Suriname and Guiana, as well as the Mercosur countries (ie, Argentina, Paraguay and Uruguay).

Moreover, Brazil also plays a significant role in the multilateral trading system by actively participating and fostering discussions in the World Trade Organization (WTO) and other international forums. Furthermore, Brazil’s rapprochement with the other BRICS countries (Russia, India, China and South Africa) also aims to maintain policy coordination with developing and emerging countries in topics relevant to international trade.

With respect to compliance with the WTO Agreements, Brazil has been a respondent in 16 disputes before the WTO to date. Brazil has been a complainant in 33 cases, and has acted as a third party in 140 cases. There are currently six ongoing cases involving Brazil, all of them as a complainant (DS506, DS507, DS514, DS522, DS568 and DS579).

Brazil has also formally requested its accession to the Organisation for Economic Co-operation and Development (OECD) in May 2017, which decision is still pending. The country is one of the largest and most-engaged non-OECD members, having adopted over 54 instruments of the OECD.

The election of right-wing politician Jair Bolsonaro as president in late 2018 brought about significant changes in Brazilian trade policy. Mr Bolsonaro was elected on a platform of promoting free trade and increasing Brazil’s presence in the global economy and in global value chains. This agenda has been pushed through mainly by the newly created Ministry of the Economy (resulting from the merger of three ministries and concentrating prerogatives on economic, commercial and industrial public policy), which has been staffed with liberal, pro-free trade officials at top-ranking levels.

In view of this, the government has repeatedly announced its intentions (and also taken concrete action) to open up the Brazilian economy on different fronts, including: the systematic reduction of tariffs, particularly for capital equipment, technology and telecommunications products; the rationalisation and streamlining of Brazil’s use of trade remedies mechanisms such as anti-dumping and countervailing measures; and microeconomic reforms aiming at enhancing firms’ competitiveness and attracting foreign investment.

Although Brazil continues to be an active participant in multilateral discussions and in the WTO in particular (including having contributed to discussions for the unlocking of the WTO Appellate Body), the country has also expressed its intention to prioritise bilateral trade discussions over multilateral agreements, in line with the position of the United States on the subject.

In general, Brazil is seeking a general alignment with the United States on trade and other policy areas, in a deviation from previous administrations’ emphasis on South-South relations. One concrete example of such a shift has been Brazil’s agreement to forego its Least Developed Country status under the WTO framework in exchange for the United States’ support of Brazil’s accession to the OECD.

Trade defence investigations (outside the WTO dispute settlement system)

Government authorities

Which authority or authorities conduct trade defence investigations and impose trade remedies in your jurisdiction?

The Subsecretariat of Trade Defence and Public Interest (SDCOM) of the Secretariat of Foreign Trade (SECEX) of the Special Secretariat of Foreign Trade and International Affairs (SECINT) of the Ministry of Economy is responsible for conducting investigations regarding trade remedies in Brazil. After concluding the investigation process, SDCOM issues its final determination, recommending (or not) the application of trade remedies to SECINT.

SECINT, in its turn, is the ultimate authority in charge of the decision to impose trade remedies, based on SDCOM’s recommendations. The decision not to apply trade remedies (negative decision) is made by SECEX.

It should be noted that Decree No. 9,679/2019, of 2 January 2019 (altered by Decree No. 9,745, of 8 April 2019) promoted a restructuring of the ministries that encompass the Brazilian Federal Government’s Executive Branch. As a result, MDIC and its departments and secretariats (eg, SDCOM and SECEX) were incorporated by the Ministry of Economy.

Complaint filing procedure

What is the procedure for domestic industry to start a trade remedies case in your jurisdiction? Can the regulator start an investigation ex officio?

Trade remedies cases are initiated in Brazil by means of a written and formal request presented by the domestic industry before SDCOM. According to the applicable legislation (Decree No. 1,488/1995, concerning safeguards; Decree No. 1,751/1995 concerning countervailing measures; and Decree No. 8,058/2013 concerning anti-dumping duties), a trade remedies claim will be accepted by SDCOM only if it is formally submitted by domestic producers responsible for at least 25 per cent of the total production of the similar product and, once consulted by SDCOM, the domestic producers of the similar product that expressed their support for the claim represent at least 50 per cent of the total production in Brazil.

To trigger the initiation of an investigation, the domestic industry must demonstrate, through positive evidence, the existence of:

  • subsidised or dumped imports;
  • alleged injury to the domestic industry; and
  • a respective causal link between the subsidised or dumped imports and the injury suffered by the domestic industry during the period of investigation.

As regards the application of safeguards, according to Decree No. 1,488/1995, the authorities will consider:

  • the volume and rate of increase of the imports (in both absolute and relative terms);
  • the share of the national market captured by such imports;
  • the prices of the imports, and especially whether such imports were under-priced in comparison to the similar product produced in Brazil;
  • the consequent impact of the imports on the domestic industry, including analysis of relevant economic factors (eg, production level, inventories or sales); and
  • the impact of other factors not related to the analysed imports on the domestic industry.

In exceptional circumstances, SECEX may initiate an investigation ex officio, provided that it disposes of significant evidence regarding the existence of the requirements that justify opening the proceeding.

With regard to anti-dumping investigations, Decree No. 8,058/2013 states that the authorities shall examine the petition within 15 days after its filing. Within five days, SDCOM may request the presentation of additional information, which shall be examined within 10 days. If SDCOM considers that no further information is required, the decision on whether to initiate the investigation shall be published within 15 days.

Contesting trade remedies

What is the procedure for foreign exporters to defend a trade remedies case in your jurisdiction?

Once SDCOM decides to initiate an investigation, a public notice from SECEX is published in Brazil’s Official Gazette with a summary of all the relevant information of the proceeding, including a list of the known interested parties. All known interested parties involved in the proceeding (including foreign governments, foreign exporters and producers, importers and domestic producers) will receive an official letter informing them about the initiation of the investigation.

Such interested parties (except foreign governments) will receive a questionnaire asking them to submit relevant information on the product, the market and internal economic indicators (eg, sales and costs) to SDCOM. The timeframe to respond to the questionnaire is 30 days from acknowledgement of the issuance of the questionnaire (presumed to be on the next business day after the issuance of the questionnaire), which can be extended by an additional 30 days (in anti-dumping investigations). During the course of the administrative proceeding, SDCOM may also request additional information or clarifications. The interested parties can be represented by themselves or by legal representatives with adequate powers of representation.

In the case of anti-dumping investigations, the deadline for the parties to submit new information and evidence (the evidentiary stage) in the case files is 120 days from the date of publication of the preliminary determination by SDCOM. After that, the parties will have the opportunity to submit their arguments based only on information already available in the case records. Brazilian regulations state that SDCOM must finish the investigation within 10 months from its initiation, although it allows this timeframe to be extended up to 18 months, according to WTO rules. Nevertheless, the final decision on the imposition of commercial remedies lies with SECINT (or SECEX), after receiving SDCOM’s recommendation.

WTO rules

Are the WTO rules on trade remedies applied in national law?

The WTO rules currently in force are considered part of Brazilian legislation through Decree No. 1,355/1994 (which implemented the WTO Marrakesh Agreement). In addition, the specific Brazilian legislation concerning the application of anti-dumping duties, countervailing measures and safeguards is consistent with the WTO rules. It is not uncommon for interested parties in a trade remedies investigation to resort to the language of the WTO Appellate Body or Panel reports in support of the their arguments in the proceeding. The Brazilian authorities are mindful of Brazil’s obligations to the WTO and generally give weight to such reports in their determinations.

Appeal

What is the appeal procedure for an unfavourable trade remedies decision? Is appeal available for all decisions? How likely is an appeal to succeed?

Upon completion of the investigation, Brazilian legislation allows interested parties to file an administrative appeal against a SECEX or SECINT decision imposing trade remedy measures, seeking reconsideration of the decision.

Furthermore, although it is not precisely an appeal procedure, interested parties may request the initiation of a public interest evaluation proceeding to be examined by SDCOM. Such a proceeding may result in the suspension or alteration of the anti-dumping duties or countervailing measures for public interest reasons (eg, risk of shortage of the product in the Brazilian market or contradiction of another public policy). In short, SDCOM shall conduct a cost-benefit assessment, whereby it considers whether the benefits of the application of the trade remedies would outweigh potential losses to Brazilian society.

Unfavourable trade remedies decisions may also be challenged via judiciary appeals. Although Brazilian courts can re-examine both formal and procedural issues and issues on the merits, they can be more deferential to specialised decisions from specialist governmental bodies. With this in mind, it is common for many interested parties to avoid bringing merit-related matters regarding trade remedies into discussion before the courts.

Considering all of the above-mentioned possible appeals, case law indicates that appeals to date have rarely succeeded. In this sense, actively participating in the proceeding and cooperating with SDCOM is extremely important when trying to ensure the best possible outcome.

Review of duties/quotas

How and when can an affected party seek a review of the duty or quota? What is the procedure and time frame for obtaining a refund of overcharged duties? Can interest be claimed?

Affected parties may request, by means of a written petition, review of either existing anti-dumping duties or quotas, although the measures will remain in force during the course of the review proceeding.

In cases of anti-dumping duties, the measures can be reviewed in the following situations:

  • change in circumstances: by proving that the circumstances that justified the imposition of measures in the past have changed, any interested party that participated in the anti-dumping investigation or in the sunset review proceeding may request the review of the duties (this type of proceeding shall be concluded within 10 months, extendable for an additional two months in exceptional cases);
  • sunset review: provided that an application is filed at least four months before the end of its term, anti-dumping duties can be extended for an additional five years if the domestic industry demonstrates that the termination of the measure shall lead to a continuation or recurrence of dumping and injury to the domestic industry (the proceeding shall take no longer than 10 months, extendable for an additional two months in exceptional cases). The measure will remain in effect while the sunset review proceeding is ongoing;
  • review for new producers or exporters (new shippers review): this is a request available to foreign producers or exporters that did not export to Brazil during the investigated period of an anti-dumping proceeding to obtain an individual margin (such review proceeding shall last up to seven months);
  • anti-circumvention review: this involves the alteration of the scope of an anti-dumping measure with a view to including imports from other origins that are being used by foreign producers and exporters to circumvent the application of the duties (proceeding to be concluded within six months, extendable in exceptional circumstances for an additional three months); and
  • reimbursement review: this is a request by importers of the product subject to anti-dumping duties to obtain reimbursement of anti-dumping duties previously paid, applicable if the dumping margin calculated during the review proceeding ends up being lower than the duty in force (review proceeding to be concluded within 10 months).

Furthermore, it is possible for interested parties to promote the request for a partial or complete review of the application of countervailing measures if:

  • the measures are no longer necessary to offset the actionable subsidy;
  • it is unlikely that there will be injury to the domestic industry if the measures are suspended; or
  • the trade remedy is no longer sufficient to offset the injury caused by the subsidy. Such review proceedings for countervailing measures shall be concluded within 12 months.
Compliance strategies

What are the practical strategies for complying with an anti-dumping/countervailing/safeguard duty or quota?

Foreign exporters and producers should fully respect decisions issued by the Brazilian authorities regarding trade remedies, since Brazil has been continually strengthening its control over compliance with trade remedies, including rigid regulations on non-preferential rules and anti-circumvention measures.

Furthermore, it is worth noting that in the case of anti-dumping investigations, foreign exporters and producers may negotiate a price undertaking commitment with SDCOM during the course of the proceeding. Through such a commitment, the respective exporter or producer commits to exporting the product to Brazil at a minimum price in exchange for not having duties levied on its exports. Price undertaking commitments may only be proposed in the period from the issuance of the preliminary determination until the end of the evidentiary stage.

A similar instrument may be adopted with regard to countervailing measures investigations. The proceedings can be suspended, without the application of measures for countries whose government agrees to eliminate or reduce the subsidy or for exporters who voluntarily agree to price commitments for the export of the product to Brazil, so that the Brazilian authorities become convinced that the adverse effect on the domestic industry resulting from the subsidy is eliminated.

Customs duties

Normal rates and notification requirements

Where are normal customs duty rates for your jurisdiction listed? Is there an exemption for low-value shipments, if so, at what level? Is there a binding tariff information system or similar in place? Are there prior notification requirements for imports?

Brazil’s customs duty rates are defined by the Mercosur Common Tariff (TEC), which is applied uniformly by all Mercosur members to extra-zone imports.

Considering that under certain circumstances there may be a need to modify the applicable customs duties on certain goods, exceptions are provided for Mercosur members to unilaterally alter the applicable duties. Currently, Brazil may temporarily alter the applicable customs duties on the following terms:

  • in accordance with Resolution GMC 08/2008, Brazil may reduce the applicable tariffs in cases of supply and demand discrepancy, such as a shortage of products available regionally;
  • in accordance with Decision CMC 26/2015, Brazil may establish a List of Exception, with 100 products with tariffs that are higher or lower than those applicable in the TEC (extended by the Mercosur countries until the end of 2021); and
  • in accordance with Decision CMC 25/15, Brazil may reduce to 2 per cent or 0 per cent the applicable tariffs under a tariff exception to capital and computing goods that are not produced locally.

The current TEC and its temporary alterations may be accessed on the Ministry of Economy’s website at www.mdic.gov.br/index.php/comercio-exterior/estatisticas-de-comercio-exterior-9/arquivos-atuais.

Low-value shipments (imports valued up to US$3,000 by international postal or courier companies) may be subject to simplified import procedures and to a simple tax rate as a substitute for the taxes usually due upon importation. The only tax exemption regarding low values is for shipments sent by natural persons to natural persons of up to 50 reais, which are characterised as gifts.

Brazilian companies may ask the Federal Revenue Service (RFB) to assess the tariff classification of products they intend to import. The tariff classification informed by the RFB is binding, and the importer is exempted from penalties arising from incorrect tariff classification for the purposes of customs clearance of the assessed imports.

Depending on their tariff code, certain products may be subject to an import licence to be issued by the competent authorities - usually prior to shipment of the goods abroad. The administrative handling table indicating the goods that require such licensing as well as the corresponding governmental body may be accessed at www.mdic.gov.br/comercio-exterior/importacao/tratamento-administrativo-de-importacao.

Special rates and preferential treatment

Where are special tariff rates, such as under free trade agreements or preferential tariffs, and countries that are given preference listed?

The preferential tariffs deriving from FTAs and exceptions to the Mercosur Common Tariff can be accessed on the Ministry of Economy’s website at http://capta.mdic.gov.br/preferencia-tarifaria/index.

Other special tariff rates may be accessed at www.mdic.gov.br/index.php/comercio-exterior/estatisticas-de-comercio-exterior-9/arquivos-atuais.

How can GSP treatment for a product be obtained or removed?

In Brazil, the authority responsible for the GSP is SECEX’s Subsecretariat of International Negotiations. In order to obtain GSP treatment for a product, the following requirements must be complied with:

  • the product must be included in the GSP list of the grantor country;
  • the product must originate from the exporter beneficiary country;
  • the product must be transported directly from the beneficiary exporter country to the grantor importing country; and
  • a proof of origin adequate to the Customs Authority, usually the Certificate of Origin Form A, must be presented.

To be considered as originating in a country, the product must be entirely manufactured in the country, or must suffer a ‘substantial transformation’, according to the Rules of Origin of the grantor country. In Brazil, according to MDIC Ordinance No. 43 of 22 November 2012, Banco do Brasil is the only institution allowed to issue the Certificate of Origin Form A, which is the necessary document in order for the export to be afforded preferential treatment granted under the GSP.

The countries and bodies currently granting GSP treatment to Brazilian products are:

  • Australia;
  • Japan;
  • Norway;
  • New Zealand;
  • Switzerland;
  • the United States; and
  • the Eurasian Economic Community.

Further information may be found at www.mdic.gov.br/comercio-exterior/negociacoes-internacionais/807-sgp-sistema-geral-de-preferencias.

Is there a duty suspension regime in place? How can duty suspension be obtained?

Yes. The Brazilian customs regulations provide for certain customs regimes designed to suspend the duties due upon importation. The RFB is the body responsible for granting and scrutinising the use of such regimes, which are listed below:

  • temporary admission, which allows for total suspension for goods that are only temporarily staying in Brazil (eg, for testing and experiments, or for events) or partial suspension for goods that are to be used economically for a certain period;
  • free trade zones , such as the Manaus Free Trade Zone, which are areas with full exemption from the taxes due upon importation, including import tax and the tax on manufactured products, for most products imported into the free trade zone;
  • drawback, which suspends, exempts or reimburses the applicable taxes for imported inputs and raw materials that are used in the manufacturing of products in Brazil that will be exported;
  • bonded warehouses, in which goods may be imported and stored with full suspension of taxes for a certain period before being nationalised or returned abroad;
  • temporary exportation, which allows for exportation with full suspension of taxes for a certain period, including import taxes during the return of the products to Brazil. When the product exported temporarily is subject to manufacturing operations, only the aggregated value will be subject to taxation during the product’s return to Brazil; and
  • special customs regimes for suspension of taxes on the importation of machines and inputs designed to improve and boost the expansion of specific sectors in Brazil, such as the mining, natural gas and crude oil exploration sectors (eg, REPETRO, RECOM and REPEX).
Challenge

Where can customs decisions be challenged in your jurisdiction? What are the procedures?

In general terms, customs decisions can be challenged at judicial and administrative levels.

Interested parties may challenge the decision and such challenges will then be examined by a first-instance administrative body of judgment. After that, it is possible to present an appeal to the Administrative Council of Tax Appeal at the administrative level to review unfavourable customs decisions.

If a final and unfavourable decision is rendered at the administrative level, the taxpayer may still refer the matter to the Judiciary Power. Although it is almost always advisable to pursue administrative litigation before resorting to the Judiciary Power (due to the possibility of a more technical approach), it is not mandatory to do so.

Trade barriers

Government authorities

What government office handles complaints from domestic exporters against foreign trade barriers at the WTO or under other agreements?

The main government offices responsible for assessing and handling complaints of foreign trade barriers to Brazilian exports are SDCOM and the Subsecretariat of International Negotiations, all under SECEX. Domestic exporters also receive relevant support and assistance in this respect from the MRE’s Trade Litigation Division.

Additionally, in November 2017 Brazil instituted a centralised online system tasked with monitoring and quantifying trade barriers, SEM Barreiras, which is jointly controlled by the Ministry of Economy, the MRE and MAPA, and may count on the participation and input of other governmental bodies whose functions relate to international trade. The purpose of such a system is to serve as a channel through which companies, associations and individuals may report trade barriers to Brazilian exports, as well as to monitor actions taken by the Brazilian government to remove or mitigate barriers. SEM Barreiras’ website is www.sembarreiras.gov.br/painel.

Finally, the National Institute of Metrology, Standardization and Industrial Quality also provides assistance to domestic exporters with respect to technical barriers as the focal point for Brazil’s notifications to the WTO Technical Barriers to Trade Committee under the Technical Barriers to Trade Agreement.

Complaint filing procedure

What is the procedure for filing a complaint against a foreign trade barrier?

Formal complaints concerning trade barriers must be made before the Subsecretariat of International Negotiations through the filing of specific forms. All complaints are submitted to public consultation through publication in the Official Gazette. Interested parties may also report the existence of trade barriers to SEM Barreiras (question 15).

Once complaints and notifications have been filed and registered, they are dealt with by the Ministry of Economy and the MRE on a diplomatic level, through different diplomatic procedures directly with the country imposing the barriers, or in international fora, which may ultimately include requesting information about the measure at a WTO Committee or even consultations before the WTO Dispute Settlement Body (DSB), with a view to removing the trade barrier.

Grounds for investigation

What will the authority consider when deciding whether to begin an investigation?

The authority will consider the sufficiency and accuracy of the information and data presented by the domestic exporter, as well as the economic and political impact (perceived and expected) of the trade barrier to Brazil. Brazilian regulations do not specify a process that may lead to a formal investigation or proceeding seeking to tackle foreign trade barriers. There have been discussions about the implementation of a trade barrier proceeding, but such discussions have not yet progressed to a final result.

Measures against foreign trade barriers

What measures outside the WTO may the authority unilaterally take against a foreign trade barrier? Are any such measures currently in force?

Brazil traditionally adopts a diplomatic stance and cooperative approach with respect to trade barriers imposed by third countries, in line with its overall foreign trade policy. In this respect, it is the general approach of the Brazilian authorities that potential countermeasures seeking to induce the dismantling of a foreign trade barrier will follow the WTO Dispute Settlement rules, which will only allow for the imposition of countermeasures after positive rulings from a WTO Panel and the Appellate Body have been issued and after an arbitrator’s decision authorising the countermeasures.

Private-sector support

What support does the government expect from the private sector to bring a WTO case?

Only the MRE may officially represent Brazil before the WTO’s DSB. The MRE may also resort to private law firms to assist in such representation, which is carried out through public tender. Nonetheless, the affected private sector is unofficially expected to actively assist in the conduct of disputes, both in the context of building a case and of preparing a defence. Such engagement takes place during every stage of a WTO dispute, from the mustering of evidence and drafting of submissions to meetings with the WTO Panels and the Appellate Body.

Notable non-tariff barriers

What notable trade barriers other than retaliatory measures does your country impose on imports?

See question 18.

Export controls

General controls

What general controls are imposed on exports?

As a general rule, exports are not subject to taxation. In order to be able to export, a company must be enrolled with the RFB. Such enrolment, known as RADAR, provides access to the integrated foreign trade system (SISCOMEX), through which all Brazilian foreign trade transactions are processed.

A commercial invoice should be issued by the Brazilian exporter and it must contain, at least:

  • name and address of the exporter;
  • full name and address of the importer, buyer or predetermined order;
  • characteristics of the goods;
  • marking;
  • numbering and number of reference to the different volumes;
  • quantity and type;
  • gross weight;
  • net weight;
  • country of origin;
  • country of acquisition;
  • country of departure;
  • total price and price per unit of each type of goods and the value and nature of any given discounts;
  • transportation cost;
  • conditions and currency of payment; and
  • condition of sale.

The packing list is essential for customs clearance for export. Normally, it contains information about the goods, such as net weight, gross weight, the packaging setting, value per unit, volume and specific contents. However, the exporter should contact the importer so as to check the requirements of the importing country.

The Export Registry (RE), filed by the exporter through SISCOMEX, is the set of commercial, financial, foreign exchange and tax information that characterises an export transaction and defines its treatment.

Before submitting the RE to SISCOMEX, the exporter must check if the goods to be exported require prior approval, since several authorities may be competent to examine and approve the export of goods, depending on their tariff code. See question 22 for more details.

The exporter (most commonly through its customs broker) registers the RE directly with SISCOMEX, indicating the tariff code of the exported goods. A tax invoice or bill of sale must also be issued to accompany the goods throughout the operation, from its exit from the Brazilian exporter’s facility to the actual exportation and customs clearance.

The transporter hired by the parties must then issue a bill of lading or airway bill, a document that will specify the type, quantity and destination of the goods and attest to their shipment to the place of destination (indicated in the commercial invoice).

The RE and the other export documents must be prepared before the registration of the export declaration (DE) and the respective shipping of the goods. The DE formally initiates the exportation customs clearance to be processed at SISCOMEX. Every RE must be registered with a respective DE, although a DE may contain more than one RE. The DE must indicate the number of the registered RE; the identification of the facilities of the exporter involved in the exportation process; the number of the bill of sale; quantity, volume, net and gross weight of the exports; the total value of the operation; and the route negotiated with the foreign importer, as well as other information.

With the registration of the DE at SISCOMEX and the presentation of the export documents (invoice, packing list etc) to the RFB, the exportation customs clearance is processed. It is not uncommon for RFB to request further information before approving the transaction.

Brazil has a set of export controls based on the use and classification of goods. Such controls must be reviewed before any operation so as to obtain the necessary authorisation. In particular, products considered as ‘sensitive goods’ are subject to stricter controls.

The list of products subject to prior consent in exports and the consenting authorities is available at www.mdic.gov.br/index.php/comercio-exterior/exportacao/tratamento-administrativo-de-exportacao.

Government authorities

Which authorities handle the controls?

The bodies and agencies are listed below, based on their area of expertise related to the controlled goods:

  • the Brazilian Electricity Regulatory Agency: www.aneel.gov.br;
  • the National Petroleum Agency: www.anp.gov.br;
  • the National Sanitary Surveillance Agency: portal.anvisa.gov.br;
  • the National Nuclear Energy Commission: www.cnen.gov.br;
  • army command: www.eb.mil.br;
  • the SECEX’s Subsecretariat of Operations for Foreign Trade: www.mdic.gov.br/index.php/comercio-exterior/despachos-de-comercio-exterior;
  • the National Department of Mineral Production: www.dnpm.gov.br;
  • the Federal Police: www.dpf.gov.br;
  • the Brazilian Institute of Environment and Renewable Natural Resources: www.ibama.gov.br;
  • the Ministry of Science and Technology: www.mctic.gov.br; and
  • the Ministry of Defence: www.defesa.gov.br.

A particular case is the exportation of sensitive goods. The Interministerial Commission on Controlling Exports of Sensitive Goods (composed of representatives from the MRE, the Ministry of Defence, the Ministry of Economy, and the Ministry of Science and Technology) was established with the responsibility for drafting regulations implementing Law 9112/95 and applying penalties for non-compliance with and violation of export controls.

Special controls

Are separate controls imposed on specific products? Is a licence required to export such products? Give details.

The list of products subject to special controls and to export duty is set out in Annex XVII of SECEX Ordinance No. 23 of 14 July 2011, available at http://portal.siscomex.gov.br/legislacao/biblioteca-de-arquivos/secex/portaria-no-23-de-14-de-julho-de-2011.

Special attention should be paid to the regulation of the export of goods and services with potential military applications and, consequently, to the export of goods or related services with potential application in the development of weapons of mass destruction, whether nuclear, chemical or biological, and their delivery vehicles, such as missiles.

Brazilian export controls comprise the following:

  • sensitive goods: goods relevant for the production of weapons, dual-use goods and goods used in the nuclear, chemical or biological areas;
  • dual-use goods: products that can be used for purposes of war, even if they have been developed for civil applications; and
  • services related to sensitive goods: services related to the supply of information or technology for the development of sensitive goods.

These sensitive goods and services are directly linked and classified as to their nature in four major areas: nuclear, chemical, biological and projectile, according to the specific treatment internationally provided.

Therefore, producers must receive authorisation prior to starting preliminary negotiations on exports, and they must comply with legal requirements, including when participating in international bids and international exhibits.

The exportation of sensitive goods and services related to sensitive goods is subject to prior approval by the competent authorities, as listed in question 22, which includes the presentation of documents evidencing their final use, such as the end use certificate.

The administrative procedure for the approval of export authorisation is confidential. The competent authority in charge of approving such authorisation depends on the product in question.

The Brazilian authorities adopt political and strategic considerations in taking the final decision on exports. Presentation of contracts related to the export operation and other related documents may be required. Such export authorisation is normally valid for two years.

After receiving the proper authorisation, the company must follow general exportation procedures. Thus, copies of contracts and other documents may be required to approve the RE, and, consequently, the exportation.

Supply chain security

Has your jurisdiction implemented the WCO’s SAFE Framework of Standards? Does it have an AEO programme or similar?

According to the WCO, Brazil has expressed its intention to implement the WCO Framework of Standards to Secure and Facilitate Global Trade. Furthermore, the RFB fully implemented the AEO programme in 2017, which is regulated by RFB Normative Instruction 1598/2015. Eligible companies may request AEO status through a process of recognition before the RFB.

Applicable countries

Where is information on countries subject to export controls listed?

See question 29.

Named persons and institutions

Does your jurisdiction have a scheme restricting or banning exports to named persons and institutions abroad? Give details.

Brazil does not have a scheme imposing controls for exports to named persons and institutions.

Penalties

What are the possible penalties for violation of export controls?

The non-fulfilment of export controls by exporters may trigger several penalties depending on the facts under scrutiny. The possible penalties can be summarised as follows:

  • warnings;
  • fines that vary according to the value of the transaction;
  • forfeiture of the goods;
  • suspension of the right to export; and
  • prohibition to perform foreign trade transactions.

As a general rule, responsibility for violation does not depend on intent or on the nature and extent of the effects of the violation. Depending on the nature of the violation, it may also trigger criminal liabilities for the employees of the companies or individuals liable for the non-compliance.

Financial and other sanctions and trade embargoes

Government authorities

What government offices impose sanctions and embargoes?

The Ministry of Economy is responsible for the imposition of sanctions, embargoes and commercial remedies, based on the guidelines adopted by the Ministry of Foreign Affairs, in accordance with the decisions of the United Nations (UN). Brazil does not impose sanctions and embargoes unilaterally.

Applicable countries

What countries are currently the subject of sanctions or embargoes by your country?

All decisions related to the imposition of sanctions or economic embargoes made by Brazil are in accordance with the guidelines adopted by the UN and with Ordinance No. 23/2011) (www.mdic.gov.br/comercio-exterior/legislacao/862-portaria-secex-consolidada). In the case of imports into Brazil, the countries with restrictions are North Korea, Eritrea, Libya and Somalia, mainly regarding the manufacture of weapons and related materials. In the case of exports from Brazil, the countries with restrictions are Sierra Leone, Iraq, Somalia, Democratic Republic of the Congo, North Korea, Sudan, Libya and Eritrea, also related to weapons manufacturing, military equipment, combat vehicles and parts replacement.

Specific individuals and companies

Are individuals or specific companies subject to financial sanctions?

There are no individuals or specific companies subject to financial sanctions in Brazil.

Other relevant issues

Other trade remedies and controls

Describe any trade remedy measures, import or export controls not covered above that are particular to your jurisdiction.

There are no particular trade measures applied in the Brazilian jurisdiction.

UPDATE & TRENDS

Recent developments

Are there any emerging trends or hot topics in trade and customs law and policy in your jurisdiction?What effects are Brexit, the withdrawal of the US from TPP, the slowdown of TTIP, RCEP; and negotiations of FTAs (such as the EU–Japan Free Trade Agreement) expected to have on your jurisdiction?

Key developments32 Are there any emerging trends or hot topics in trade and customs law and policy in your jurisdiction?

On 28 June 2019, after more than 20 years of negotiations, Mercosur and the European Union have finally entered into a free trade agreement. These two economic blocs represent together approximately 25 per cent of the world’s GDP and a market of 780 million people.