WT/TPR/G/283/Rev.1  
23 July 2013  
(13-3955)  Page: 1/30  
Trade Policy Review Body  Original:  English  
 
 TRADE POLICY REVIEW 
REPORT BY 
BRAZIL 
Revision 
Pursuant to the Agreement Establishing the Trade Policy Review Mechanism (Annex 3 of the 
Marrakesh Agreement Establishing the World Trade Or ganization), the policy statement by Brazil is 
attached. 
 
 WT/TPR/G/283/Rev.1 • Brazil 
 
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  CONTENTS 
1   OVERVIEW ..................................................................................................................  4 
2   GENERAL ECONOM IC ENVIRONMENT .......................................................................... 4  
2.1   Macroeconomic Overview ............................................................................................ 4  
2.2   General Legal and Regulatory Fr amework ..................................................................... 6  
2.2.1   Business environment ............................................................................................. 6  
2.2.2   Financ ial syst em ..................................................................................................... 6 
2.2.3   Insura nce market ................................................................................................... 8  
2.2.4   Securities market ................................................................................................... 9  
2.2.5   Governme nt procurement ....................................................................................... 10 
2.2.6   Exchange rate an d foreign capi tal regime .................................................................. 10 
2.2.7   Export insurance .................................................................................................... 10 
2.2.8   Long run producti on and export  finance .................................................................... 11 
2.3   Social Policies ......................................................................................................... . 12 
3   TRADE POLICY DEVE LOPMENTS (2 009-12) ............................................................... 13  
3.1   Latest Developments in Brazilian Fo reign Trade ............................................................ 13 
3.2   Participation in the WTO ............................................................................................ 13 
3.2.1   The Doha Ro und .................................................................................................... 13 
3.2.2   Dispute settlement ................................................................................................. 13 
3.2.3   Special and differential treatment ............................................................................. 14 
3.3   Preferential Agreements ............................................................................................ 14 
3.3.1   ME RCOSUR ........................................................................................................... 14 
3.3.2   MERCOSUR and regional agreements ........................................................................ 16 
3.3.3   MERCOSUR and extr a-regional ag reements ............................................................... 17 
3.3.4   Global system of trade pr eferences........................................................................... 18 
4   TRADE INSTITUTIONAL AN D REGULATORY FRAMEWORK.......................................... 18  
4.1   Cross-Cu tting Issues ................................................................................................. 18 
4.1.1   Techni cal stan dards ............................................................................................... 18 
4.1.2   Trade facilitation .................................................................................................... 19 
4.1.3   Sanitary and phytosanitar y issues ............................................................................ 20 
4.1.4   Competition policy ................................................................................................. 21 
4.1.5   Trade remedies ..................................................................................................... 22 
4.1.6   Intellectual property ............................................................................................... 22 
4.2   Sector al Issu es ........................................................................................................ 23 
4.2.1   In dustry .............................................................................................................. . 23 
4.2.2   Agriculture ............................................................................................................ 23 
4.2.3   Services .............................................................................................................. . 24 
4.2.4   Renewable energy ................................................................................................. 25 
4.2.5   Land  transp ort ...................................................................................................... 26 
4.2.6   Air transp ort .........................................................................................................  26 WT/TPR/G/283/Rev.1 • Brazil 
 
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  4.2.7   Ports and ma ritime tr ansport ................................................................................... 27 
4.2.8   Telecommunications ............................................................................................... 27 
5   FUTURE DE VELOPMENTS ........................................................................................... 28  
 
 WT/TPR/G/283/Rev.1 • Brazil 
 
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  1  OVERVIEW  
1.1.  The Brazilian Government is pleased to submit its Sixth Trade Policy Report to the scrutiny of 
fellow WTO Members. Brazil considers this periodic review mechanism as a key element of the multilateral trading system embodied in the WTO, contributing to a more transparent and 
comprehensive understanding of Members' trade policies and regulatory frameworks. 
1.2.  The period examined in this TPR (2009-12) was characterized by a world financial crisis 
followed by an economic recession and a slow reco very. In spite of the difficult external economic 
environment, Brazil was able to partially offset the negative effects through countercyclical 
economic policies aimed at sustaining the levels of production and employment. As a result of sound macroeconomic policies and fiscal responsibility, income distribution and an inflation targeting regime, Brazil was able to witness im provements in domestic demand and supply, and 
an increase in the level of employment throughout this period. 
1.3.  Brazilian resilience to the crisis was also due to the ongoing process of diversification of its 
commercial relationships. Brazilian trade flows expanded with both traditional and new trade 
partners, consolidating Brazil's position as a global trader.  
1.4.  The multilateral trading system is a priority in Brazil's foreign trade policy. Brazil believes that 
well-functioning multilateral trade rules are essential for the efficiency of international trade and 
for the good functioning of the global economy. In  this context, Brazil has consistently reiterated 
its commitment to the conclusion of the Doha Round and with its objective of promoting a more equitable and development-oriented international trading system.  
1.5.  Notwithstanding the priority it attributes to the multilateral trading system, Brazil also 
believes that preferential trade agreements can play a complementary role in the efforts to 
harness the benefits of international trade towards the goal of economic and social development of 
all Members. In this respect, it considers that existing multilateral disciplines regarding preferential 
trade agreements are geared to ensure that these instruments do not undermine the global 
rules-based multilateral trading system. This is particularly relevant as complementarity requires that such agreements aim at facilitating trade between their constituent Members without raising 
barriers to the trade of other Members.  
1.6.  Brazil further believes that bilateral and regional trade agreements can help build the basis 
for trade liberalization at the multilateral level. The development of regional economies of scale can help reap the benefits of integration in international trade flows and therefore contribute to 
prosperity and development. It is in this spirit that integration with MERCOSUR remains one of the 
main objectives of Brazilian policy.  
2  GENERAL ECONOMIC ENVIRONMENT 
2.1  Macroeconomic Overview 
2.1.  The Brazilian economy was affected by the financial crisis, but it was not severely disrupted. 
The tripod of economic policy - based on inflatio n targeting, a floating exchange rate and fiscal 
responsibility -, the high level of international reserves, falling net public debt and a solid domestic 
financial system have reduced the impacts of the crisis. In fact, the Brazilian Government established the conditions that allowed the country to face the financial and economic crisis through the use of a broad range of economic po licy instruments. After growing 6.1% and 5.2% 
in 2007 and 2008, the economy contracted 0.3% in 2009,  leading to the adoption of a set of fiscal 
and monetary measures. The recovery was strong, resulting in growth of 7.5% in 2010. The next two years showed less vigorous growth, of 2.7% and 0.9% in 2011 and 2012, respectively, 
reflecting the worsening of the international cont ext, the appreciation of the Brazilian currency 
(Real) and monetary tightening in late 2010 and first half of 2011. An economic rebound has been under way since the second half of 2012 and growth is expected to gather steam along 2013, with 
first quarter annualized growth rates expected to be  around 4%. Recent growth volatility in Brazil 
mostly reflects global economic conditions, notably the financial crisis of 2008/2009 and the Eurozone crisis in 2011/2012, with the latter strongly influencing the downward trend in investments up to the third quarter of 2012. WT/TPR/G/283/Rev.1 • Brazil 
 
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  2.2.  The public sector continues to pursue fiscal consolidation in accordance with the principle of 
fiscal responsibility, one of the pillars of Brazil 's economic policy. In 2012, the primary surplus 
reached 2.4% of GDP. Consistent primary surpluses have contributed to a declining trend in total net public debt. Net public debt was reduced from 60.4% of GDP in 2002 to 42.1% in 2009, 
and 35.1% at the end of 2012. In the next few years, the projected primary results point to 
further reductions in both the nominal deficit and public debt. The increase in the share of fixed 
rate bonds in securitized debt has helped to reduce volatility in public debt management. The 
share of federal public debt with floating intere st rates on the total federal debt fell from 33.9% 
in 2008 to 21.7% in 2012. The average maturity of federal public debt increased from 3.4 years in January 2009 to 4.0 years in Ja nuary 2013. The improved profile of public debt 
and the lower level of debt-to-GDP ratio have allowed the Government to adopt countercyclical 
measures, such as tax relieves, in the aftermath of the 2008 international financial crisis, without 
generating financial stress. The Government cont inues to pursue, however, better control over 
current expenditures. A major landmark, in the period under review, was the reform of the 
pension system for civil servants (Law 12.618/12), br inging it into line with the general pension 
system and thereby increasing its long term sustainability. 
2.3.  In an environment of weak external dema nd, the economy has been sustained by domestic 
demand, in particular household consumption, as a result of strong job creation and income gains. 
The unemployment rate reached a new low record of 4.6% in December 2012, and average real wages grew 4.1% in 2012. Both employment and the work force have continued to grow at 
relatively high rates (2.2% and 1.7% in 2012, respectively) considering the economic moderation 
of 2011-12. Income transfers to low-income families continued to contribute to the reduction of 
inequalities.  
2.4.  Interest rates continued in a downward trend. The benchmark overnight rate (SELIC) 
reached its historic low of 7.25% in October 2012. In the financial system, interest rates for credit 
and bank spreads also showed downward movement, re aching historically low levels. As a result of 
the reduction in nominal interest rates, Brazil began to experience lower levels of real interest 
rates. The credit market has expanded significantly, driven by gains in real income and 
employment. The outstanding stock of loans in the financial system increased 18.8% and 16.4% in 2011 and 2012, respectively, reaching 53.5% of GDP by the end of 2012. In this new context, the economy has experienced more appropriate financial costs, with positive effects for the 
development of capital markets, such as debentures, stocks and other assets related to productive 
investment. Investment and infrastructure debentures improved in 2012. In the second half of 2012, the first emissions of these debentures for the financing of investments in transport and 
energy took place.  
2.5.  The year of 2012 was the ninth consecutive year when inflation – at 5.84% – remained 
within the target set by the Central Bank. From 2009 to 2012, the main upward pressures in 
inflation came from increases in services and food prices, which remained above the average 
annual headline inflation of 5.64%. For the services sector, the tight labor market represented an important source of price pressures. Weather events that affected grain prices in the international markets in 2010 and 2012, as well as the evolution of domestic prices of fresh products in 2012, 
also had an impact on food prices. 
2.6.  Brazil has been one of the early adopters of macroprudential policies. The National Monetary 
Council (CMN) and the Central Bank of Brazil (BCB) played a major role in monitoring and acting 
to ensure financial stability during the global financial crisis. The BCB has been actively developing 
its macroprudential policy framework for some time, devoting resources to systemic risk monitoring, implementing various macroprudential or capital flow management measures and, 
more recently, establishing a Financial Stability Committee within the BCB. 
2.7.  After a reduction in 2009, foreign trade expa nded at annual average rate of 16.6% in exports 
and 20.4% in imports. Exports grew from US$153.0 billion in 2009 to US$242.6 billion in 2012, while imports increased from US$127.7 billion in 2009 to US$223.1 billion. In the 2008-12 period, 
the deficits in current account, as percentage of GDP, reached 1.7%, 1.5%, 2.2%, 2.1% and 2.4% 
in each of those years. In 2012, the reduction in the trade surplus was balanced by lower profit remittances. At the same time, the country has b een attractive to foreign investment, mainly 
foreign direct investments (FDI), which totaled US $65.3 billion in 2012. Thus, the current account 
deficit was fully financed by net FDI inflows. International reserves remained at high levels, reaching US$378.6 billion at the end of 2012, bolste ring the ability of the Brazilian economy to WT/TPR/G/283/Rev.1 • Brazil 
 
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  face external shocks. In March 2013, the stock of international reserves represented 
US$373.7 billion, four times more than the debt service for the 12 months ahead. 
2.2  General Legal and Regulatory Framework 2.2.1  Business environment  
2.8.  In the period under review, the Brazilian  Government strengthened policies aimed at 
encouraging the migration of enterprises to the formal sector, rationalizing and simplifying tax obligations and reducing administrative and operational costs for taxpayers.  
2.9.  The movement towards electronic procedures for filing documents and fulfilling tax 
obligations continued apace. Implementation of th e Public System of Digi tal Bookkeeping (SPED) 
started in 2007. Among the instruments developed under the SPED, there is the Digital Bookkeeping, which aims to replace paper bookkeep ing, and the Electronic Invoice Project (NF-e), 
which aims to replace paper invoices. By the end of 2012, more than 6 billion electronic invoices 
had already been issued. The main benefits of these measures for the taxpayer are cost reduction, the simplification and rationalization of tax compliance and reduced paper consumption, as well as 
standardization of information and preservation of the environment. For the tax and customs 
administration, the main benefits are: quicker access to information, improvement of control and surveillance, reduction of tax evasion and increase of tax revenues. 
2.10.  The "Simples Nacional" regime was expanded by means of an increase in gross revenue 
limits and permitted fields of activity. The "Simpl es Nacional" is a differentiated and simplified tax 
regime applicable to Micro and Small Enterprises, which comprises the Federal, state and local tax administrations and allows for the payment of eight different taxes by means of a single document 
and a single tax rate applicable to gross revenue. Since January 2012, the maximum annual gross 
revenue for a company opting for the "Simples National" is R$3,600,000.  
2.11.  Aiming at promoting the democratization of  credit and banking, the Program "Crescer" was 
introduced in August 2011 under the National Program for Productive Micro-credit - PNMPO. The 
expansion of micro-credit in Brazil purports to encourage entrepreneurship, to give opportunity to new businesses and to meet the financial needs of  entrepreneurs of small productive activities. 
The program provides for direct relationships with entrepreneurs in local economic activities, 
preliminary evaluation of the investment capaci ty of the business and contact throughout the 
contract period. Operations are directed at in formal individual entrepreneurs, individual 
entrepreneurs and micro-enterprises with revenues of up to R$120,000 per year. Funding goes up 
to a maximum of R$15,000 for working capital or investment, with payment terms agreed 
between financial institutions and borrowers according to the type of project and resource usage.  
2.12.  The Program "Crescer" targets the lowest income groups, encouraging and supporting their 
access to the exercise of an economic activity. In May 2012, 51% of the beneficiaries of the 
Program were registered in the Single Registry for Social Programs of the Federal Government. 
38% of them were beneficiaries of the "Bolsa Fa mília" and 34.5% of the transactions benefited 
people in extreme poverty conditions, with a monthly per capita income of up to R$70 – as 
identified by the "Brazil Without Misery" progra m. From April 2005 until July 2012, the PNMPO held 
more than 11.3 million micro-credit operations, with total volume of credit of over R$15.7 billion (in nominal terms). In the first half of 2012, the program reached a volume of R$3.5 billion, with 
1.5 million active clients. 
2.2.2  Financial system  2.13.  The stability of th e Brazilian financial system has remained high in recent years due to the 
implementation of the policies mentioned in item (i) and to continued favorable developments in 
the macroeconomic environment. The major Brazilia n banks have remained well equipped to face 
the global credit crunch, relying on their solid solvency position and high profitability. The 
exposure of the Brazilian banking sector to structur ed credit instruments, including in the form of 
derivatives, remains very low. Stress tests for credit and market risks conducted by the Central Bank of Brazil (BCB) in recent years show that the system can absorb losses from relatively large 
shocks without threatening systemic solvency. The credit portfolio has grown, supported by strong 
domestic demand and increasing bank competition for market share. The main drivers of credit WT/TPR/G/283/Rev.1 • Brazil 
 
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  demand have been a sustained increase in real income, the emergence of new middle-class and 
the recent regulatory improvements to wards the reduction of lending risk. 
2.14.  In 2012, Brazil’s financial sector was subjected to the IMF’s and the World Bank’s Financial 
Sector Assessment Program (FSAP). The FSAP mission  found the Brazilian financial system to be 
stable, with low levels of systemic risk and sizable capital buffers. According to the FSAP report, 
published in July 2012, "while coping with volatile capital inflows remains a challenge, the Brazilian authorities have effectively used macroprudential measures to contain systemic risks". It was also 
highlighted that "Brazil’s strong financial markets infrastructure and strong regulation and 
supervision have been an important factor in maintaining financial stability". Furthermore, the assessment concluded that "Banking supervision is risk-based and robust", reflecting a high degree of compliance with the Basel Core Principles for Effective Banking Supervision. The 
Assessment also characterized the Brazilian financial system as solid, well capitalized and with high 
levels of liquidity and provisions against delinquency. 
2.15.  Brazil is committed to implement the Ba sel III capital framework in a schedule consistent 
with goals for capital definition, minimum capital requirements, capital buffers, liquidity ratios and 
leverage ratio. Final regulations were issued on 1 March 2013 by the National Monetary Council 
and by the Central Bank of Brazil, covering the re definition of capital; new capital requirements 
and introduction of capital buffers for institutions in general; optional simplified new capital 
requirements and capital buffers for single credit cooperatives; scope of consolidation of accounting statements of financial institutions; the methodology of calculation of risk-weighted assets (RWAs) for credit risk, market risk and operational risk for institutions that use the 
standardized approaches or the advanced approaches of capital calculation. 
2.16.  A National Financial System Clients Reference File (CCS) was created in 2005, complying 
with Anti-Money Laundering (AML) provisions. All financial institutions are required to maintain a 
data record of account holders and clients, as well as their legal representatives, as part of a 
general reference file centralized at BCB. The CCS makes it possible for proper authorities to request and consult data on a centralized database involving information on deposit accounts and 
financial assets in the form of properties, rights and values held or administered at SFN 
institutions. Financial institutions are accountable for daily update of CCS data and for the preciseness and timeliness of information. The judiciary will be able to use CCS information on the basis of specific agreements established with co urts. In the framework of AML measures, financial 
institutions must adopt procedures regarding the establishment of business relationships and 
monitoring of financial transactions of clients considered to be politically exposed persons. 
2.17.  Law 12.683 of 7 September 2012 modernized the legislation against money laundering 
through the significant expansion of the list of economic sectors participating in the efforts to 
prevent and combat money laundering and financing of terrorism, while preserving the set of obligations affecting such sectors. At the international level, in 2012 the Council for Financial 
Activities Control (COAF) worked on the first Br azilian follow-up report to the 2010 process of 
mutual evaluation conducted by the Financial Action Task Force against Money Laundering and Terrorist Financing (FATF). 
2.18.  Interest rate spreads have continued to fa ll following the decline of the benchmark interest 
rate (from 12.5% in August 2011 to 7.25% in October 2012), and benefited from progress on the 
"deindexation" (reduction in automatic price rises linked to the CPI) of the Brazilian economy, in particular the elimination of a legal minimum interest rate payable to savings accounts. This 
process has been helped by regulation to improve comparability of bank services and the 
portability of credit operations in order to foster competition, as well as by a sharp reduction in public banks’ lending interest rates. Credit portability consists of the borrower’s ability to transfer 
debts to another financial institution. During 2012, both the number of transferred loans and the 
volume of transactions were near record highs. 
2.19.  A series of measures have been taken with the aim of making it easier for clients of financial 
institutions to establish business relationships with other financial institutions. One of the major 
elements in reducing asymmetries was the creation of the Credit Information System (SCR), a 
credit bureau managed by the BCB which gathers credit data from all banks and all borrowers. WT/TPR/G/283/Rev.1 • Brazil 
 
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  2.20.  In order to increase the access of low income populations to financial services, the national 
partnership for banking inclusion was launched in May 2012, with the participation of various public and private actors, comprising a series of goals to be met by 2014: (i) increase the adequacy of the supply of financial services to the needs of the economy and the population; 
(ii) raise the level of financial literacy of the population, combating over-indebtedness; 
(iii) encourage popular savings; (iv) strengthen protection mechanisms for users of financial services; (v) foster the sustainable development of productive micro-credit; (vi ) ensure stability 
and promote the improvement of the model of banking correspondents; and (vii) increase 
knowledge about the Brazilian reality in relation to financial inclusion. The objective is to continue to promote financial inclusion while ensuring solvency and credit quality. 
2.21.  Over the past five years, the share of popu lation with an active relationship with financial 
institutions increased 31%, reaching 121 million people, or 84% of the population aged 15 and 
above. Currently, all 5,565 Brazilian municipalities have at least one point of access to financial services. 
2.2.3  Insurance market  
2.22.  The insurance industry has grown significan tly in recent years, thanks to the favorable 
economic environment for the sector in Brazil. In  2012, the insurance, "capitalization" and open 
supplementary pension scheme markets had a turnov er of approximately R$157 billion, equivalent 
to 3.6% of GDP – an increase of over 21% over the previous year. In December 2012, there were 
162 insurance companies (118 insurance societies, 19 capitalization societies, 25 supplementary pension institutions), 102 reinsurers (12 local reinsurers, 29 admitted and 61 possible), 
34 reinsurance brokers and more than 75,000 in surance brokers operating in the insurance 
market.  
2.23.  Between 2000 and 2012, insurance premiu ms increased 463%, capitalization products 
increased 278%, and open supplementary pension plans 105%. Between 2009 and 2012, the 
amount paid in insurance premiums increased by 69% (19.1% annually). The value invested in capitalization products grew 64% (18% annually) and resources from contributions in open 
supplementary pension plans increased by 29% (8.85% annually). In 2012, insurance companies 
had total technical reserves of approximately R$414 billion. These performances reflect the stabilization of the economy, as well as liberalization in some sectors.  
2.24.  The National Council for Private Insurance (CNSP), a collective body responsible for 
elaborating the rules regulating the insuranc e market, and the Superintendence of Private 
Insurance (SUSEP), the agency in charge of over seeing and supervising the sector, have steadily 
improved regulation and supervision in order to adjust them to the current dynamics of the 
Brazilian insurance market and to align them with the best international practices. The objectives 
are the development of the insurance indu stry and greater consumer protection. 
2.25.  A significant development in insurance regulation was the development of guarantee 
insurance ("seguro garantia") for contracts and public bids. A relatively novel insurance product in 
the Brazilian market, it is expected that guar antee insurance will play a major role in the 
organization of the major upcoming sport events in Brazil, the 2014 World Cup and the 2016 Olympic Games. 
2.26.  With a view to promoting the financial inclusion of low-income populations and 
micro-entrepreneurs, SUSEP has encouraged the cr eation and development of simple and low cost 
products, including the simplification of the market  operation of these products. In this context, 
the regulation of micro-insurance products was concluded in 2012 and the first related products 
are already being marketed. 
2.27.  The liberalization of the reinsurance market, made possible by Complementary Law 126, 
of January 2007, created a new framework for the reinsurance business by opening the sector to 
foreign companies and for companies domiciled abroad. Based on this new regulation, the operations of reinsurance and retrocession can be held with the local reinsurer (established as corporations with the sole object of conducting operations of reinsurance and retrocession), with 
the admitted reinsurer (domiciled abroad, with an offi ce of representation in Brazil, registered at 
SUSEP to carry out operations of reinsurance and retrocession); and with the foreign reinsurer WT/TPR/G/283/Rev.1 • Brazil 
 
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  (foreign reinsurer domiciled abroad without an office  of representation in Brazil and registered as 
such in SUSEP). The expansion of this sector co rresponds to the Government’s expectations and 
objectives and counts with a significant participation of foreign companies. The consolidation of the liberalization of the reinsurance market spurs th e development of the domestic insurance market 
by providing more comprehensive and innovative products and increasing competition in the local 
market. 
2.2.4  Securities market  
2.28.  The capital market in Brazil was heavily influenced during the years 2008-12 by an external 
environment marked by uncertainty and instability, arising initially from the Global Financial Crisis of 2008/2009, and later from the European sovereign debt crisis and the variable progress on fiscal adjustment in the euro zone countries. Howeve r, in spite of the difficult external environment 
and the resulting climate of risk aversion, both th e primary and secondary capital markets in Brazil 
managed to present positive developments in this period. 
2.29.  In the primary market, public share offering s developed positively, totaling R$700 billion of 
funds raised by means of various instruments, such as equities and corporate debt bonds, 
in five years. Including Petrobras shares offe ring in 2010 and the debenture leasing companies’ 
emissions, the amount totals about R$900 billion.  Likewise, investment funds continued to grow, 
with positive net inflows of around R$450 billion during the same five-year period. 
2008 2009 2010 2011 2012112.14122.77147.75151.25165.68Public share offerings1- R$ billion
(1) These figures encompass public offerings of shares2, debentures3, promissory notes, mortgage backed securities - MBS (CRIs), 
and in shares of asset-backed securities - ABS (FIDCs) and in real estate investment funds (FIIs), and private equity funds (FIP s);  
values based on registrations, registration exemptions and ICVM 476 (public offering with restricted sales efforts).
(2)  Excluded the distribution of Petrobras in 2010 (approximately, R$120 bi).
(3)  Excluding distributions of leasing companies (R$31.15 bi, in 2008;  R$11.1 bi, in 2011;  and R$35 bi, in 2012).
 
2.30.  The secondary market also followed an upward trend: average stock cash trading grew from 
approximately R$5 billion per day in 2008 to R$6.3 billion in 2012, while the number of transactions went from 44 million (2008) to 157 million (2012) per year. The corporate bond 
market also gained greater liquidity and tran sparency with the implementation of several 
measures by both the public and the private sect ors, including facilitation of the process of 
issuance of debentures. 
2.31.  Two facts are worth mentioning due to the fa ct that they represent structural changes. The 
first is the creation of new products during this period, providing risk diversification and better 
resource allocation. Although incipient, securitization products such as CRIs (MBS) and FIDCs (ABS), real estate investment funds and Exchange  Traded Funds began to consolidate. The second WT/TPR/G/283/Rev.1 • Brazil 
 
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  one is the reduction of the benchmark interest rate (SELIC). This has already led to increased 
demand for corporate bonds for investors seeking higher yields. 
2.2.5  Government procurement  2.32.  Brazil has a decentralized procurement syst em. Federal, State and Municipal authorities can 
make public purchases, in accordance with th e Tendering Law (Law 8.666 of 1993). According to 
the general Law, public entities cannot establish differential treatment between Brazilian and foreign companies. Five procurement modalities can be used by public entities: open tendering; 
price consultation; invitation; contest; and public auction.  
2.33.  During the period under review, the Minist ry of Planning advanced significantly in the 
modernization of Federal Government procurement systems, by emphasizing electronic procurement and by consolidating the model of reverse auction as the main type of tender 
conducted in Brazil. 
2.34.  In general, the main factors to be considered for determining the modality to be employed 
are the value and the nature of the object being tendered. From 2008 to 2012, electronic reverse 
auctions accounted for almost 50% of the value of federal contracts opened to tendering. In 
its 2010 assessment study, the World Bank noted th at the mainstreaming of reverse auctions has 
helped to enhance the efficiency and transparency of Brazil's procurement system. 
2.35.  An important feature of the Government procurement system in Brazil is access to 
information. Bidders can easily find substantial information online through the ComprasNet website (http://www.comprasnet.gov.br) and the Transpar ency Portal (http://www.portaltransparencia. 
gov.br). In addition, the Tendering Law requires both federal and sub-federal governments to give 
wide publicity to tendering processes. 
2.36.  In August 2011, the Government established a special procurement regime
1 intended to 
increase the efficiency of the national procurement system in order to facilitate the organization of 
the upcoming sport events to be hosted by Brazil. The special procurement regime applies 
exclusively to bids and contracts necessary for the organization of the Olympic and Paralympic 
Games in 2016, the 2013 FIFA Confederations  Cup and the 2014 FIFA World Cup, and for 
infrastructure works included in the Government's  Growth Acceleration Program (PAC). The special 
regime does not establish differential treatment for national or foreign companies, services and products.  
2.2.6  Exchange rate and foreign capital regime  
2.37.  There is a single market for foreign exchange rate in Brazil. Clients may freely negotiate the 
exchange rate with institutions authorized to operate in the primary foreign exchange market. There is no repatriation requirement of export proceeds, and exporters are allowed to keep all 
their revenues abroad.  
2.38.  There is no approval requirement to bring foreign capital into Brazil. Nevertheless, all 
foreign capital – including foreign direct and portfolio investments, foreign credit and financing – 
entering Brazil must be registered at the Central Bank. The registration is made in declaratory and 
electronic forms in the corresponding modules of the Electronic Declaratory Registration (RDE), at the Central Bank Information System – Sisbacen. Repatriating investments and income related to foreign capital; such as liquidated equity and bond investments, dividend payments and making 
payments on a foreign loan; are also made with out the need for Central Bank authorization. 
2.2.7  Export insurance  2.39.  The main official mechanism to promote Brazilian exports is the Export Guarantee Fund 
(FGE), established in 1997. The Fund guarantees  exports of domestic goods and services in 
operations longer than two years. For Micro, Smal l and Medium Enterprises, the Fund is allowed to 
provide export guarantee also for operations shor ter than two years. Other operations for periods 
                                               
1 Law 12.462 of 4 August 2011. WT/TPR/G/283/Rev.1 • Brazil 
 
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  below two years are served by the private market of insurance. Between 2009 and 2012, 
253 operations of export credit insurance were ap proved under the FGE, totaling US$32.6 billion.  
2.40.  Brazil is a participant in the Aircraft Sector Understanding within the Organization for 
Economic Cooperation and Development (OECD), applying the premiums and other conditions 
established by the agreement. In 2012, Law 12.712 created the Brazilian Agency of Management 
of Guarantor Funds and Guarantees SA (ABGF). The Agency, not yet in operation, will manage the 
Guarantee Fund for Foreign Trade Operations (FGCE). The FGCE will gradually be capitalized up to 
a limit of R$14 billion, as provided by the same law. 
2.2.8  Long run production and export finance  2.41.  The National Bank of Social and Economic Development (BNDES), a state-owned bank 
created in 1952, is the main source of long term credit in Brazil. Since its foundation, BNDES has 
played a fundamental role in stimulating the expansion of industry and infrastructure in the 
country. Over the course of the Bank’s history, its operations have evolved in accordance with the country’s social and economic challenges, and now they include support for technological 
innovation, sustainable socio-environmental development and the modernization of public 
administration. Currently, the long term financin g needed for investment in fixed assets, both 
direct – through capital markets – and indirect – through the banking system – is still scarce, and 
the activities of BNDES have complemented those of commercial banks, with a clear segmentation 
between short and long term credit. Brazil’s financial market continues to be mainly focused on the short term, with liquidity concentrated in few assets. 
2.42.  The achievement of investment grade and the consolidation of macroeconomic stabilization 
have laid down the basis for strengthening the domestic financial and capital markets. Government 
policy with regard to public debt is leading to an extension of average maturity and to greater 
reliance on fixed rate instruments. Measures are being taken to support the formation of more 
liquid and comprehensive secondary markets for financial assets. It is expected that private capital 
and financial markets will gradually supply a larger share of long term investments. 
2.43.  Credit lines offered by BNDES encompass long term financing for the development of 
investment projects and for the commercialization of new machines and equipments, as well as 
the financing of Brazilian exports, taking into account ethical, environmental and sustainable development principles. BNDES’ credit lines also contribute to strengthen the capital of private 
companies and to the development of capital markets. 
2.44.  BNDES disbursed R$156 billion in 2012, up 11.6% compared to 2011. Industry and 
infrastructure, together, accounted for 65% of th e Bank’s total disbursements. BNDES had a net 
profit of R$8.18 billion in 2012. The Bank was able to achieve a financial performance consistent 
with its activities as a development bank, reaching a credit portfolio of approximately R$495 billion 
in December 2012. The capital adequacy index (Basel Index) recorded by the BNDES was 15.4%, whereas the required index by the Central Bank is 11%. Total assets amounted to R$715.4 billion 
in December 2012, an increase of R$90.6 billion (14.5%) over December 2011. 
2.45.  The significant increase in total disb ursements since 2008 reflects both the augmented 
support to investment in infrastructure and energy and the operation of anti-cyclical measures to encourage investment in the aftermath of the global financial crisis. 
2.46.  Defaults on BNDES' credit portfolio represented 0.06% of the total in 2012, below the 
national average of 3.6% in the same period. In  December 2012, 99.1% of total credits granted 
by the bank were classified between risk levels AA and C, well above the average of the National 
Financial System. The Bank seeks to harmonize competitive interest rates with the preservation of 
public equity by continuously monitoring credits and guarantees that cover the debt position over 
the duration of the contracts. 
2.47.  BNDES offers two export credit lines: a) pre-shipment credit, which supplies working capital 
for Brazilian exporters; and b) post-shipment credit, which targets the commercialization of 
exported goods and services through buyer's or supplier's credit, in accordance with international standards.  WT/TPR/G/283/Rev.1 • Brazil 
 
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  2.48.  BNDES' export credit disbursements decreased from US$11.5 billion dollars in 2010 to 
US$5.5 billion dollars by the end of 2012. The amount of disbursements in 2009 and 2010 was a 
reaction to the global financial crisis, in particular the scarcity of trade finance. Since 2012, traditional trade finance channels have returned to  normal and, as a result, BNDES' disbursements 
have decreased. 
2.49.  Capital goods accounted for 60.5% of the total export finance disbursements in 2012. This 
includes buses, trucks, light commercial vehicles, industrial machinery and equipment, as well as 
aircraft. Exports of engineering and construction services and software accounted for 26.4%. Labor 
intensive consumer goods, such as footwear, textiles, processed food and furniture accounted for 13.1% of total disbursements.  
2.50.  Latin America has been a major destination of exports financed by BNDES since the 
inception of the export credit facility in 1990. The region accounted for 49.1% of the US$1 billion 
in post-shipment disbursements in 2012. The main exports financed are goods and services for infrastructure projects in the region, such as dams, pipelines, aqueducts, subways, transmission 
lines and gas infrastructure. 31.3% of all post-shipment disbursements went to Africa, also for 
goods and services for infrastructure development. The US, Europe and Asia accounted for 19.6% of exports – mostly aircraft – financed by the post-shipment credit facility. 
2.3  Social Policies  
2.51.  During the period under review, Brazil has continued to prioritize social development, 
combining economic growth, income distribution and targeted policies to fight poverty, the reduction of inequalities and the improvement of overall living standards. 
2.52.  From 2009 to 2012, social indicators of health, education, employment, housing, life 
expectancy and income distribution have improved considerably. This is a result of a two-folded social policy focused on strengthening and expanding the scope of universal policies in education, 
health, labor, care and social security on on e hand, and implementing targeted programs and 
actions to promote social inclusion of the low-income and most vulnerable populations on the other.  
2.53.  The Government also placed emphasis on public investment that, associated with the 
enabling environment of low interests rates and credit and income expansion, has encouraged private investment, expanded production and stimulated job creation. From 2011 to the end of 2012, 4 million new jobs were created. Brazil has now the lowest unemployment rate in its 
history. Additionally, nominal minimum wage rose  about 63% during the period under review.  
2.54.  Targeted programs and actions have been established or expanded to promote social 
inclusion of the low-income and most vulnerable populations. This is the case of the "Brazil without 
misery", a broad plan of action which encompasses other programs, such as "Bolsa Família" and 
"Rede Cegonha", among others. More specific targ eted programs worth mentioning are "My House, 
My Life", "Pronatec", "ProUni", "FIES" and "Sci ence Without Borders", that target affordable 
housing, vocational training, higher education and research. A million families have already 
benefited from the Program "My House, My Life" and a million more shall benefit from it in the years to come. 
2.55.  As of December 2012, the Program "Brazil without misery" has managed to raise 
16.4 million Brazilians above the line of extrem e poverty. Income distribution policies have 
benefited more significantly the lowest income population. Between 2001 and 2011, the income of the poorest 10% of the population rose 5.5 time s faster than that of the richest 10% of the 
population.  
2.56.  The country is close to the objective of  achieving universal basic education, with the 
enrolment of 98.2% of children from 7 to 14 year s in 2011. The share of th e population over the 
age of 15 that is illiterate decreased from 9.7%  in 2009 to 8.6% in 2011. In addition, the number 
of places in technical and professional courses for students and workers was increased to 2.5 million with the support of the Pronatec program. WT/TPR/G/283/Rev.1 • Brazil 
 
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  2.57.  In the countryside, social improvements were also significant. The Government has 
increased access to basic services, such as sanitation, energy and education and expanded income guarantees and measures aimed at enhancing the participation of rural populations in agricultural and non-agricultural productive activities. Almost 4.8 million rural dwellers rose above the poverty 
line.  
3  TRADE POLICY DEVELOPMENTS (2009-12) 3.1  Latest Developments in Brazilian Foreign Trade  
3.1.  Brazilian foreign trade continued to increa se since 2009, both in nominal terms and as a 
percentage of the GDP. The country's foreign trade volume increased 65.9% between 2009 and 2012, from US$281 billion to US$466 billion. Relative to GDP, foreign trade grew from 17.6% in 2009 to 20.7% in 2012. The share of Brazilian ex ports in global trade also increased, from 
1.25% in 2009 to 1.44% in 2011, partly as a result of the effort to expand the number of 
exporting firms. Between 2009 and 2011, around 20,000 companies were involved in Brazilian exports; 47.6% of them were small enterprises,  26.0% medium and 26.4% large enterprises.  
3.2.  The period 2009-2012 was marked by sign ificant surpluses in goods trade: on average 
US$24 billion, with a peak of US$29.8 billion in 2011. During the period under review, Brazil has diversified the destination of its manufactured and agricultural goods. Exports to Asia increased 
87.2%; to Latin America, 41.4%; to Eastern Europe, 27.9%; to Africa, 40.5%; and to the Middle 
East, 52.6%. 
3.3.  Manufactured goods accounted for 37.4% of exports, semi-manufactured goods for 13.6%, 
agricultural and mineral commodities account for 46.8%. The remaining 2.2% are accounted by 
special operations. The main industrial exports were aircrafts, automobiles, auto-parts, cellulose, 
semi-manufactured steel, radio transmitters and receivers, and shoes. The main commodities 
exported were iron, oil, soy, beef, coffee, tobacco and cotton. 
3.4.  Raw materials and intermediate products had a share of 44.7% of total imports in 2012. 
These were followed by capital goods (21.8%),  consumer goods (17.6%) and oil and gasoline 
(15.8%). Pharmaceutical goods, fertilizers, heavy equipment and industrial machines, 
automobiles, electronic goods, plastic materials, and grains were among the main products 
imported by Brazil. 
3.2  Participation in the WTO  3.2.1  The Doha Round  
3.5.  Brazil remains firmly committed to the Do ha Development Round. It considers that the DDA 
will only be successful if it results in benefits for all Members, particularly for developing countries.  
3.6.  Brazil remains convinced that priority should be assigned to meaningful results on 
agriculture, since the overwhelming majority of the vulnerable segments of the population have 
their livelihoods linked to the rural areas and the sector remains subject to a wide array of trade distortions and protectionism, which hamper effective exploitation of developing countries' 
competitiveness in this field. A successful conc lusion of the DDA would bring new, structural 
opportunities for developing countries through: a) the elimination of agriculture export subsidies; b) a significant reduction of domestic subsidies for agriculture in developed countries, c) the expansion of market access for agricultural products; and d) the reduction of tariff escalation. 
3.7.  Brazil also recognizes that the current dead lock calls for realism and pragmatism. Brazil will 
continue to engage constructively with a view to achieving a concrete, balanced outcome in Bali, which should provide the first step towards the full resumption of the Doha Round negotiations. 
3.2.2  Dispute settlement  
3.8.  In line with a long-standing tradition of respect for international law, Brazil attaches a high 
priority to strengthening the WTO dispute settlemen t system and has actively participated in the 
mechanism since its very first dispute (U.S. – Gasoline). To date, of 456 WTO disputes, Brazil WT/TPR/G/283/Rev.1 • Brazil 
 
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  participated in 114 – 26 as complainant, 14 as respondent and 74 as a third party.  Most of the 
cases dealt with issues that are at the core of the multilateral trading system, such as: the protection of the environment (Brazil – Tyres) and public health (EU – Generic Drugs); granting of 
subsidies both to industrial (Canada – Aircraft) and agricultural goods (EU – Sugar and 
US - Upland Cotton) and the application of trade restrictive measures by developed countries 
(US - Orange Juice). 
3.9.  Currently, the only active pending dispute in which Brazil participates as main party is the 
US – Upland Cotton case. In 2010, Brazil and US signed an interim agreement, in which the 
United States agreed to establish and contribute on a monthly basis to a Fund for technical assistance and capacity building in the cotton sector in Brazil until successor legislation to the Food, Conservation and Energy Act of 2008 is enacted in the US, hopefully allowing for a definitive 
solution to the Cotton dispute.  
3.2.3  Special and differential treatment  3.10.  Brazil attaches great importance to the WTO principle of special and differential treatment 
(SDT) to developing and least developed countries (LDCs). Effective S&DT provisions are 
important first steps towards leveling the playing field among members. Brazil remains committed to fulfill the Doha Declaration determination regarding the revision of all special and differential 
treatment provisions with a view to streng thening and making them more effective and 
operational. Brazil attaches great value to the work of the Committee on Trade and Development, in the context of the Doha Development Round an d as a reviewer of regional trade agreements 
(RTAs) between developing countries and preference schemes favoring developing countries 
authorized under the Enabling Clause. Brazil a ppreciates the work carried out by the Committee 
since 2007 in implementing the RTA Transparency Mechanism for RTAs falling under paragraph 2(c) of the Enabling Clause. 
3.3  Preferential Agreements  
3.11.  Notwithstanding the priority it attributes to the multilateral trading system, Brazil believes 
that preferential trade agreements can play a su pplementary role in the efforts to harness the 
benefits of international trade towards the goal of economic and social development of all 
Members. In this respect, it understands that existing multilateral disciplines regarding preferential trade agreements are geared to ensuring that these instruments do not undermine the global rules-based multilateral trading system.  
3.12.  Within the Latin-American region, Brazil participates in regional agreements under the 
provisions of the Latin American Integration Association (LAIA). Brazil’s trade policy is structured around the MERCOSUR customs union, in which Venezuela has formally joined Argentina, Brazil, 
Paraguay and Uruguay as a full Member on 12 Au gust 2012. Bolivia also signed a Protocol of 
Accession to MERCOSUR on 7 December 2012. The Protocol is currently under exam by 
Parliaments in the signatory parties.  
3.13.  MERCOSUR concluded free trade agreements (FTA) with Egypt, in 2010, and Palestine 
in 2011. Negotiations on the MERCOSUR–EU Association Agreement were formally re-launched in May 2010 and Ministers agreed to exchange market access offers no later than the last quarter of 2013. MERCOSUR and Canada have engaged in  an exploratory dialogue with a view to 
determining the feasibility of initiating negotiations for an FTA.  
3.3.1  MERCOSUR  3.14.  MERCOSUR was established in 1991 by the Treaty of Asuncion
2, and its institutional 
structure was defined in 1994 by the Protocol of Ouro Preto. MERCOSUR is Brazil's main 
preferential agreement in terms of value of trad e, accounting for more of 10% of its merchandise 
trade3 and is also the backbone for further regional integration and negotiation of extra-regional 
                                               
2 MERCOSUR is incorporated in the LAIA legal regime  as Economic Complementarity Agreement No. 18.  
LAIA economic complementarity agreements must be open for accession by any LAIA country. 
3 As of August 2012, available information on MERCOSUR trade includes its four original members 
(Argentina, Brazil, Paraguay, and Uruguay) but does not include Venezuela. WT/TPR/G/283/Rev.1 • Brazil 
 
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  agreements. The MERCOSUR market is particularly important to Brazil as the main destination for 
manufactured goods with higher added value. 
3.15.  The Common Market Group (GMC) and the Council for the Common Market (CMC) are the 
main executive and decision-making bodies of MERC OSUR respectively. The Council’s mission is to 
formulate policy and promote actions that help to configure the Common Market, and it is 
integrated by the Ministers of External Relation s and of the Economy of member states. The GMC 
oversees the application of the Treaty of Asunc ion, its protocols and agreements, and can make 
recommendations to the Council. It is entitled to issue mandatory Resolutions that apply to all 
member states. It is also in charge of negotiations with other countries, groups of countries and international organizations. The MERCOSUR Trade Commission (CCM) is responsible for the application of common trade policy instruments. 
3.16.  Dispute Settlement in MERCOSUR is re gulated by the Protocol of Olivos, signed 
in February 2002 and in force since January 2004. Under the Protocol of Olivos, member states can choose to file disputes either within MERC OSUR or at the WTO. Upon agreement by the 
parties, the Common Market Group can provide mediation. Cases are handled by a Court of Ad 
Hoc Arbitration (TAHM) and/or by the Permanent Review Court (PRC), which is composed of five judges.  
3.17.  Created in December 2005, the Parliament of MERCOSUR symbolizes the political decision 
to strengthen and deepen the integration process and to develop common interests and values in the region.  
3.18.  During the period under revision, MERCOSUR has taken important steps towards the 
consolidation of the Customs Union. MERCOSUR member states share a Common External Tariff 
(CET), which entered into force on 1 January 1995. Different exceptions have been admitted 
through Decisions by the CMC. All MERCOSUR member  states are currently authorized to have an 
exception list of products on which higher or lower tariffs vis à vis  the CET will be applied. There 
are different provisions for each country. Brazil can include up to 100 tariff lines and modify as many as 20% of them every six months, until the end of 2015.
4 Brazil is also allowed to establish 
special tariffs for Capital Goods (BK) until the end of 2013 and for Informatics and 
Telecommunications Goods (BIT) until the end of 2015.5  
3.19.  In the context of the global economic  crisis, the Common Market Council approved 
Decision 39/11, which allowed temporary tariff increases to deal with imbalances arising from 
international economic situation. Under this Decision, countries are allowed to request a unilateral 
increase of import tax rates within the limits of WTO bound levels for up to 100 tariff lines. In June 2012, the Common Market Council adopted Decision CMC 25/12, which extends the 
authorization for unilateral tariff increases to up to two hundred tariff lines until the end of 2014. 
Decision CMC 25/12 is pending ratification by all members to enter into force. 
3.20.  The Agreement on the Elimination of Doub le Collection of CET and the Distribution of 
Customs Revenue in MERCOSUR, approved by Deci sion 54/04, grants local MERCOSUR status to 
imported products that conform to Common Tariff Policy (PAC). Its implementation consists of 
three phases. The first one refers to goods benefiting from a CET of 0% and to merchandise imported by member states with 100% preferential tariffs under MERCOSUR agreements with third 
parties.  The second stage would cover the remaining goods.
6 The third stage will require 
implementing a customs revenue distribution me chanism and the unification of customs systems 
in all member states. Since 2010, MERCOSUR member states have been negotiating the 
implementation of these three phases, a ccording to Decisions CMC 10/10 and 56/10. 
3.21.  The sugar and automotive sectors are the only ones excluded from free movement within 
MERCOSUR. There is no schedule for the inclusion of sugar in the free trade regime. Trade in the 
automotive sector between Brazil and MERCOSUR members is still largely regulated by bilateral 
agreements, which have been renegotiated – within the framework of LAIA – in the period under 
                                               
4 Provisions are identical for Argentina. Paraguay was authorized to maintain a list of up to 649 tariff 
headings until the end of 2019, and Uruguay can include up to 225 tariff headings until the end of 2017. 
5 Decisions CMC 39/05, 13/06, 27/06, 61/07, 58/08, 57/10 and 65/12. 
6 This stage is subject to the ratification and entry into force of the Customs Code. MERCOSUR 
CMC/DEC 27/10 and MERCOSUR CMC/DEC 34/11. WT/TPR/G/283/Rev.1 • Brazil 
 
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  review. Trade flows are free of duty in the sector under the conditions foreseen therein. The 
regional agreement on automotive policy ratifi ed by member states in 2000 and 2001 did not 
enter fully in force as originally planned. In 2010, Decision CMC 56/10 called for the establishment of a working group to draft a new common automotive policy. 
3.22.  Deeper integration of production chains within the region has been an important aim of 
MERCOSUR. Several initiatives are under way to foster integration in the automotive, tourism, wood and furniture, and oil and gas sectors. To  this end, the Common Market Council approved 
Decision 41/08, which created the "MERCOSUR Guarantee Fund for Micro, Small and Medium 
Enterprises", conceived as a tool to facilitate access to credit for smaller companies, as well as to stimulate projects of productive integration. Decision CMC 46/12, approved at the MERCOSUR 
Summit in December 2012, laid down regulations for the functioning of the Fund.  
3.23.  Established in 2006, the Fund for the Structural Convergence of MERCOSUR (FOCEM) 
(Decisions CMC 45/04 and 18/05) epitomizes MERCOSUR’s commitment to bridging the development gap between the countries of the re gion. It aims at funding the development of 
infrastructure and social cohesion in MERCOSUR. The Fund is made up of contributions from all 
member states. Paraguay and Uruguay are the main beneficiaries of FOCEM and Brazil is the main contributor. 
3.24.  The Protocol of Montevideo on Trade of Services entered in force on 7 December 2005 
between Argentina, Brazil and Uruguay. It establishes a schedule for services liberalization (covering both market access and national tr eatment measures) within MERCOSUR, to be 
completed by December 2015. Under the Protocol of Montevideo, the Parties have scheduled 
commitments in virtually all sectors and sub-sectors covered by the WTO Services Sectoral 
Classification List (MTN.GNS/W/120). The Protocol on Government Procurement negotiated in 2006 did not enter into force and member states are currently committed to its revision. 
3.25.  The accession of Venezuela and the proce ss of accession of Bolivia to MERCOSUR in 2012 
are important landmarks. Besides increasing regional trade, the incorporation of Venezuela and Bolivia to MERCOSUR allows for closer co-operation in strategic sectors such as energy and 
infrastructure. Venezuela, together with the four founding member states, signed its accession 
protocol to MERCOSUR in July 2006. Venezuela became a full member on 12 August 2012. Commitments regarding trade liberalization in goods between Venezuela and other MERCOSUR members were made effective by bilateral Economic Complementation Agreements signed 
individually by each country with Venezuela on  26 December 2012. Brazil and Venezuela signed 
the Economic Complementation Agreement No. 69 (ACE-69). Venezuela will adopt the MERCOSUR Nomenclature and Common External Tariff and rules according to a schedule of commitments. In 
addition, Bolivia has started its accession process with the signing of the Protocol of Accession, 
on 7 December 2012. Following approval by member state parliaments, Bolivia will become the sixth member of MERCOSUR. 
3.26.  Member states have agreed a number of instruments with a view to facilitating the 
movement of citizens amongst all participating countries. Active participation of civil society and social movements in discussing public policies in areas as diverse as education, health, labour, human rights and others is also contributing to  the enlargement of social responsibility and 
political accountability. This is as much an institutional breakthrough as it is a commitment to 
advancing the social agenda of MERCOSUR integration. 
3.3.2  MERCOSUR and regional agreements  
3.27.  The Latin American Integration Association (LAIA) provides the framework for trade 
agreements signed by Brazil and by MERCOSUR  with other partners in the region. Such 
agreements fall under the provisions of the Enabling Clause and are consistent with WTO rules. 
3.28.  MERCOSUR has a broad range of trade ag reements within the framework of LAIA. These 
trade agreements are known as Economic Complementation Agreements (ACEs). They have been signed with Bolivia (ACE-36), Chile (ACE-35), Peru (ACE-58), and Cuba (ACE-62). Additionally, there is a joint agreement with  Colombia, Ecuador, and Venezuela (ACE-59). In July 2002, an 
agreement on trade in the automotive sector  was signed between MERCOSUR and Mexico 
(ACE-55). WT/TPR/G/283/Rev.1 • Brazil 
 
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  3.29.  Since 2001 MERCOSUR member countries are committed to the collective negotiation of 
trade agreements with third parties/countries, in accordance with CMC Decision 32/00. 
3.30.  Preferential margins granted within th e framework of the ACEs between MERCOSUR and 
Chile and between MERCOSUR and Bolivia have incr eased considerably since their entry into force 
in 1996 and 1997, respectively. Chile and Bolivia became MERCOSUR associate members, 
following the conclusion of the abovementioned ag reements. As a result of the signature of ACE-58 
and ACE-59, Peru, Colombia and Ecuador also became associate members of MERCOSUR. ACE-58 
and ACE-59 have entered into force in February 2006 and January and April 2005, respectively.  
3.31.  Besides the aforementioned agreements  in the framework of MERCOSUR, Brazil has 
celebrated a bilateral fixed tariff preferences agreements with Mexico (signed in July 2002, ACE-53). Brazil has also signed a "Partial Scop e Agreement" with Guyana (AAP-38), in 2001, in 
which nearly all the negotiated products enjoy 100% tariff preference. 
3.3.3  MERCOSUR and extra-regional agreements  3.32.  Negotiations for a Bi-regional Asso ciation Agreement between MERCOSUR and the 
European Union, originally launched in 1999 and suspended in 2004, were re-launched at the 
MERCOSUR-EU Summit in May 2010. Since then, nine negotiating rounds have taken place, leading to progress in the normative framework of  the agreement. In January 2013, Ministers from 
both sides met in Santiago, Chile, on the margins of the CELAC-EU Summit. They instructed 
negotiators to exchange market access offers no later than the last quarter of 2013. These offers 
will comprise the areas of goods, services, investment and government procurement. 
3.33.  MERCOSUR and Canada agreed, in 2010, to undertake an Exploratory Dialogue aiming at 
considering the feasibility of launching negotiations towards an FTA between the parties. 
In May 2012, after three meetings, the first part of  the exercise was concluded and both sides are 
currently in the process of examining its results with internal stakeholders. 
3.34.  On 1 June 2009, the Preferential Trade Agreement between MERCOSUR and the Republic of 
India, signed in 2004, entered into force. The agreement establishes fixed preference margins 
of 10%, 20% and a 100% for approximately 450 products on each side's list of concessions and 
contains provisions, among others, on rules of origin, state trading enterprises, preferential 
safeguards, antidumping and countervailing meas ures, technical regulations, standards and 
conformity assessment procedures, sanitary and phytosanitary measures and dispute settlement. The Agreement was notified to the Committee on Trade and Development of the WTO under the 
Enabling Clause in February 2010 (WT/COMTD/N/31). 
3.35.  On 3 April 2010, the Free Trade Agreemen t between MERCOSUR and Israel entered into 
force for Brazil and Israel (September 2011 fo r all MERCOSUR State Parties). The Agreement 
contains a tariff reduction schedule based on four categories, the largest of which foresees 
elimination of tariffs in ten years, with a fifth category containing products subject to tariff rate quotas and fixed margins of preference. The agre ement has provisions, among others, on rules of 
origin, safeguards, technical regulations, standards and conformity assessment procedures, 
sanitary and phytosanitary measures, technical and technological cooperation, customs cooperation and dispute settlement. 
3.36.  MERCOSUR and Egypt signed an FTA in August 2010. Tariff liberalization will be made on 
the basis of four categories, the largest of which foresees elimination of tariffs in ten years, with a 
fifth category in which liberalization will be defined by the Joint Committee of the Agreement. The agreement contains provisions on rules of origin , preferential safeguards, technical regulations, 
standards and conformity assessment procedures, sanitary and phytosanitary measures, customs 
cooperation, and dispute settlement. The agreement provides for its entry into force thirty (30) days after the date of the notification to the Depositary of the instrument of ratification 
of the last Signatory Party.  
3.37.  In 2010, the Brazilian Congress approved  the Preferential Trade Agreement between 
MERCOSUR and the Southern Africa Customs Unio n (SACU), which had been signed by the State 
Parties to MERCOSUR in 15 December 2008 and by SACU Member States in 3 April 2009. As 
of March 2013, consultations with the SACU Secretariat were still pending regarding some formal WT/TPR/G/283/Rev.1 • Brazil 
 
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  adjustments to the Portuguese language versio n of the Agreement, in order to allow the 
ratification process to continue in Brazil. The agreement establishes fixed preference margins of 
10%, 25%, 50% and a 100% for approximately 1,150 products on each side’s list of concessions and contains provisions on rules of origin, preferential safeguards, technical regulations and 
standards, sanitary and phytosanitary measures  and dispute settlement. The Agreement shall 
enter into force after all Signatory Parties have formally notified, through diplomatic channels, the completion of their respective inte rnal procedures to that effect.  
3.38.  Between October 2008 and November 2010, MERCOSUR and the Kingdom of Jordan held 
four negotiating rounds with a view to concludi ng a Free Trade Agreement, following a Framework 
Agreement between the two Parties signed in June 2008. Negotiations were suspended in November 2010 and have not yet been resumed. Other MERCOSUR negotiations with partners 
outside Latin America have been initiated in the last few years but are still pending, namely with 
the Gulf Cooperation Council (last round in 2007), Morocco (last round in 2008), and Turkey (last round in 2008). 
3.39.  MERCOSUR signed an FTA with Palestine in 20 December 2011. The Agreement contains a 
tariff reduction schedule based on four categories , the largest of which foresees elimination of 
tariffs in ten years, with a fifth category containing products subject to tariff rate quotas and fixed 
margins of preference. Particular attention was given to the products of priority export interest of 
Palestine. The agreement has provisions on rules of origin, bilateral safeguards, technical regulations, standards and conformity assessm ent procedures, sanitary and phytosanitary 
measures, technical and technological cooperation, customs cooperation and dispute settlement. 
The agreement provides for its entry into force,  bilaterally, after Palestine and one of the 
MERCOSUR States ratify it. 
3.3.4  Global system of trade preferences  
3.40.  Brazil, along with other 42 developing countries, is a member of the GSTP (Global System of 
Trade Preferences among Developing Countries). In  view of the large increase in South-South 
trade in recent years, GSTP has gained import ance as an instrument to further enhance and 
deepen trade among developing countries. Hence, Brazil actively promoted the launch of a 
third round of negotiations of the GSTP, which took place in São Paulo, in June 2004, during 
UNCTAD XI. 
3.41.  The round was completed on 15 December 2010, at a Ministerial Meeting in Foz do Iguaçu, 
with 11 signatories: Cuba, South Korea, Egypt, India, Indonesia, Malaysia and Morocco and the 
MERCOSUR countries. Signatories account for a population of over 2 billion people and over 9% of world trade. 
3.42.  The general conditions established in the agreement are a preference margin of at least 
20%, for at least 70% or each participants tariff lines. In practice, margins of preference will be accorded to more than 47,000 products.  
3.43.  Brazil has already initiated internal proc eedings for the ratification of the Agreement and 
looks forward to its entry into  force as soon as possible. 
4  TRADE INSTITUTIONAL AN D REGULATORY FRAMEWORK 
4.1  Cross-Cutting Issues 
4.1.1  Technical standards  
4.1.  The Brazilian institutional framework for technical regulations has remained broadly 
unchanged during the period under review. The National Institute of Metrology, Quality and 
Technology (INMETRO) was given new attributions by Law 12.545/11, which include taking part in 
SISCOMEX’s consenting body for non-automatic licensing of goods, regulating measures to prevent deceptive practices of trade and working toge ther with the Federal Police to improve the 
conformity assessment of goods, before they enter the country. WT/TPR/G/283/Rev.1 • Brazil 
 
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  4.2.  In accordance with the Agreement on Technical Barriers to Trade (TBT), Brazil has notified 
the WTO some 382 Technical Regulations and Proced ures for Assessment of Conformity, including 
new regulations, addenda, revisions, and corrigenda and supplements. As a general rule, international standards are the basis for elaboration of technical regulations. INMETRO is the 
national enquiry point for technical regulations and conformity assessment procedures in Brazil. 
INMETRO also promotes bilateral, regional and multilateral cooperation with other WTO TBT enquiry points aiming at improving transparency and  for the exchange of information. 
4.3.  From 2009 to 2012, Brazil has intensified its participation in international organizations 
dedicated to the creation and impl ementation of standards, such as the Codex Alimentarius; ISO; 
IEC; ITU; and the United Nations Committees on the Transportation of Dangerous Goods (SCETDG) and on the Classification and Labeling of Chemical Products (SCEGHS), among others, 
in order to keep its regulations aligned with international standards in the related sectors. 
4.4.  Brazil has also signed mutual recognition agreements with multilateral accreditation bodies 
such as the "Bureau International des Poids et Mesures" (BIPM), the International Laboratory 
Accreditation Cooperation (ILAC), the Inter American Accreditation Cooperation (IAAC), the 
International Accreditation Forum (IAF), the American Aerospace Quality Group (AAQG), the Program for the Endorsement of Forest Certification Schemes (PEFC) and the Global Partnership 
for Good Agricultural Practice (Globalgap). More over, in 2011, Brazil (through INMETRO) became a 
full party to the OECD decisions on the mutual  acceptance of data (MAD) – Good Laboratory 
Practice (GLP) on pesticides, their components an d related products and on industrial chemical 
products. 
4.5.  Under the framework of MERCOSUR, Brazil has worked with other members to develop a 
system of harmonization of technical requiremen ts. After each MERCOSUR member has carried out 
domestic consultations, and before they are adop ted by MERCOSUR in the  form of Resolutions, 
technical regulations are notified to the WTO. Brazil also has bilateral cooperation initiatives on 
technical regulations with Argentina, Bolivia, China, Chile, Cuba, Costa Rica, the Dominican Republic, Ecuador, Germany, Guatemala, Fran ce, India, Italy, Japan, Lebanon, Mexico, 
Mozambique, Panama, Paraguay, Peru, Portugal, the Republic of Korea, Singapore, South Africa, 
Russia, Trinidad and Tobago, Turkey, Ukraine, th e United Kingdom, the United States, Uruguay 
and Venezuela. 
4.1.2  Trade facilitation  
4.6.  During the period under review, the Brazili an Chamber of Foreign Trade (CAMEX) established 
principles and rules, to be observed by govern ment agencies, with a view to improving trade 
procedures, creating a more favorable environm ent and expediting commercial exchanges. CAMEX 
intends to reduce red tape and the regulatory  burden, to streamline procedures, to improve 
transparency and to strengthen security. The object ive is to reduce inspections by improving risk 
management systems; granting “Authorized Econ omic Operator” status for traders with good 
compliance records; reduce transaction costs; and develop automated systems and technologies to 
improve information exchange between border authorities. 
4.7.  In March 2008, Resolution CAMEX 16 established the Working Group on Trade Facilitation 
(GTFAC) that is comprised by the main agencies involved in foreign trade. The GTFAC has focused 
on the analysis of the performance and efficiency of government intervention in foreign trade and 
on the elaboration of proposals for legal and oper ational improvements. The GTFAC is tasked with 
monitoring, reviewing, reporting progress and prop osing measures, including updating procedures 
and regulations, promoting better coordination and streamlining risk assessment analysis by 
government agencies. The GTFAC is also coordina ting efforts for the expansion and improvement 
of the special regime for the modernization of port facilities (REPORTO). 
4.8.  Some of the results achieved by GTFAC incl ude (i) the establishment of the Brazilian Foreign 
Trade Gateway (www.comexbrasil.gov.br), which co ntains the main requirements, procedures and 
regulations related to foreign trade, especially im ports, and links to the sites of all government 
agencies involved with foreign trade; (ii) the im provement of electronic systems with a view to 
reducing average clearance times, using the single window approach; (iii) the setup of an 
Instantaneous Imports Licensing Deferring tool, intended to speed up approval of import licenses; WT/TPR/G/283/Rev.1 • Brazil 
 
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  and (iv) the development of governmental qualification and training programs on trade facilitation 
for border control officials.  
4.9.  CAMEX has also set up a task force to develop a more detailed tariff schedule nomenclature 
which will add, at the national level, 4 (four) digits to the MERCOSUR Common Tariff Nomenclature 
(NCM). The expansion is called "Detalhamento Brasileiro de Nomenclatura" (DBN). 
4.10.  Brazil has also adhered to the Vienna Convention on Contracts for the International Sale of 
Goods. Adhesion was approved by Congress in 2012 and ratification is expected soon. 
4.11.  In 2009, the Brazilian customs and tax administration started online public external 
consultations, allowing operators and other stakeholders to know in advance and to submit comments to proposed new or amended customs regulations. Also since 2009, a calculator available on the Customs website allows importers and other stakeholders to calculate the value of 
all federal taxes levied on imports of a given product and to consult information regarding licensing 
and trade remedy measures. 
4.12.  Since 2011, the tax and customs administration has used the Administrative Digital Process 
(e-Process), which enables the electronic processing of documents and expedites administrative 
appeal procedures. The main benefits are the decrease in the cost and time needed for administrative actions and the online monitoring of appeals, as well as the possibility of consulting 
and appending documents in proceedings. In Apr il 2011, the Brazilian customs authority received 
the Innovation Award in Tax Administration from the Inter-American Centre of Tax Administrations (CIAT), for the implementation of e-Process. 
4.13.  In the period under review, despite the cont inuing decline in the percentage of import and 
export declarations selected for verification, there was a substantial increase in the volume of 
seizures of goods and payment of taxes otherwise evaded. Brazil currently has a selection index of 
approximately 12% of foreign trade operations for verification, with a decreasing trend. Also 
during this period, the percentage of imports released by Customs in less than one day has 
increased, reaching 81.16% of the total imports in 2012. The average clearance time has been decreasing year by year, albeit with a slight increase in 2012, and is currently 53 hours for imports 
and 11 hours for exports. 
4.14.  Furthermore, with a view to improving the risk management of foreign trade operations, the 
National Centre for Customs Risk Management (CERAD) was created in 2012 with the primary mission of coordinating and guiding the studies and research aiming at the selection of operations 
of foreign trade and for the verification and identification of areas of greater risk to the customs 
control.  
4.15.  At the end of 2010, a new computerized sy stem for documents and international express air 
shipments control began to operate, aiming at reducing bureaucracy and preventing fraud in this 
modality of imports. In 2012, more than 2 million express shipment import declarations were processed. 
4.1.3  Sanitary and phytosanitary issues  
4.16.  Brazil is committed to animal and plant heal th and food safety in accordance with the WTO 
SPS agreement. All measures aiming at protecting human or animal health from food-borne risks, 
human health from animal or plant carried diseases and animals and plants from pests or diseases 
are regularly notified to the WTO and made avai lable on the internet. The most important risk 
analysis processes are notified to the WTO, and the relevant sanitary or phytosanitary events immediately reported to the competent international organizations and authorities of trade 
partners. Brazilian Enquiry Points work in a coordinated manner and all of them attend SPS 
Committee meetings. Sanitary and phytosanitary measures are mostly based on standards and guidelines produced by Codex Alimentarius, OIE, and IPPC.  
4.17.  Since the creation of the WTO, Brazil has signed more than thirty bilateral agreements on 
sanitary and phytosanitary matters, based on SPS Agreement principles. The main purpose of these agreements is to identify common rules, simplify import controls, harmonize certification requirements, and facilitate bilateral trade and the entry of selected products. The importance of WT/TPR/G/283/Rev.1 • Brazil 
 
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  such agreements for Brazilian exporters and their trade partners can be measured by the increase 
of the bilateral volume of trade exports with more than one hundred countries and the integration of medium and small-sized agriculture producers into the international market in sectors as honeybee, organic products, fresh fruits and flowers. However, the full potential of Brazil's 
agribusiness has yet to be fully developed, mainly  due to the lack of recognition of equivalence 
agreements by some countries, as recommended by the SPS Agreement. 
4.1.4  Competition policy  
4.18.  In May 2012, a new Competition Law entered into force in Brazil (Law 12.529). The new law 
introduced significant changes to the structure of the governmental agencies in charge of 
competition policy enforcement in Brazil, which includes mergers and unilateral and coordinated anticompetitive conducts control. CADE became the center of the Brazilian Competition Policy 
System (SBDC). The System is also composed by the Secretariat of Economic Monitoring (SEAE), 
under the Ministry of Finance. SEAE is current ly responsible for competition advocacy, which 
includes dialoguing with public agents and proposing pro-competitive actions. CADE is in charge of 
all competition enforcement matters, including investigations of anticompetitive practices and 
mergers review. In exercising this role, CADE ma y reject or impose remedies to anticompetitive 
mergers, as well as apply sanctions towards companies and individuals that engage in 
anticompetitive conducts.  
4.19.  CADE operates at the Administrative level, as a member of the Executive branch. 
Anticompetitive conducts can also be challenged in judicial civil lawsuits. Executives and other personnel can be prosecuted in criminal courts. 
4.20.  The new Law retained CADE's independence and transparency obligations. CADE's 
President, Superintendent, Commissioners and At torney-General are appointed for fixed terms, 
and CADE's decisions are final within the Executive branch. All opinions and decisions are 
published in the Brazilian Official Gazette and in CADE’s website. The law establishes exceptions to 
publicity, which include companies’ sensitive and strategic data and information.  
4.21.  The main substantive change introduced in 2012 was the adoption of a pre-merger control 
regime. Until last year, mergers were reviewed ex post facto , which reduced predictability and 
rendered difficult the application of remedies. Th e new Competition Law requires that mergers to 
be notified beforehand for CA DE's analysis and approval.
7  
4.22.  The new regime also established new noti fication thresholds. Until 2012, notification was 
based on the market share and the annual gross revenue of the merger. The new law eliminated 
the market share criteria and updated the revenue criteria. Currently, a merger must be notified 
for approval if the annual gross revenue in Brazil of one of the parties is equal to or greater than 
US$375 million and if the second party's revenue is greater than US$37.5 million. The new 
threshold has reduced the number of mergers that require examination by CADE, allowing the agency to focus on more significant anticompetitive cases. 
4.23.  The present legislation fixed a 240 day peri od in which a decision on the mergers approval 
or disapproval must be delivered. In particularly complex cases, this period can be extended by an 
additional 90 days. Failure to render a decision within this time limit implies automatic approval. In practice, the agency has been able to deliver final statements within this limit. 
4.24.  The new Competition Law maintained CADE’s role of investigating and applying sanctions 
against companies and individuals engaged in ca rtels and abuse of dominance practices. The 
antitrust authority’s jurisdiction covers any anticompetitive practices that may potentially cause 
effects to consumers in Brazil. This includes conducts that occur outside Brazilian territory that 
may affect its internal market, for instance through exports. International cartels are a major concern of CADE’s and have required increasingly closer collaboration with other antitrust agencies 
throughout the globe. 
                                               
7 The failure or delay to notify a transaction to  CADE subjects the parties to a fine up until 
US$30 million, besides the annulment of the operation and in certain cases to a cartel prosecution. WT/TPR/G/283/Rev.1 • Brazil 
 
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  4.1.5  Trade remedies  
4.25.  Regarding the fight against unfair and trade distortive practices during the period under 
review, Brazil made use of trade defense remedies , such as anti-dumping duties, in conformity 
with the relevant WTO rules. 
4.26.  In order to adapt its legal framework for the use of such instruments, Brazil enacted new 
legislation in 2011 (Portaria SECEX 46/2011) in order to clarify the existing rules, as well as to simplify and expedite the conduct of AD investigations. In 2012, a new rule was enacted with a 
view to regulating the representation of stakeholders during investigations.  
4.27.  The modernization process of Brazilian trade defense legislation also encompasses the 
development of a new decree that will regulate  administrative procedures relating to AD 
investigations. The main changes to be introduced by the new legislation relate to the 
establishment of shorter deadlines for investigations, introduction of new disciplines such as 
assessment scope and re-determination, refinement of  rules for revision of existing measures and 
issues relating to the effectiveness of antidumping duties. 
4.28.  In the more recent period, the Brazilian investigating authority hired 47 additional trade 
defense investigators, bringing to 65 the total number of staff. The objective of these changes in regulations and personnel is (i) to reduce the length of AD investigations from 15 to 10 months 
and (ii) to allow for preliminary determinations within 120 days from the date of commencement 
of an investigation.  
4.29.  The improvements to the regulatory framework and the increase in the number of 
investigators and petitions in the last years do not represent any reduction in the technical rigor of 
the investigating authority work. On average, abou t 50% of the petitions filed do not result in 
investigations and, out of all investigations actually initiated, about 40% do not result in the imposition of definitive measures. 
4.1.6  Intellectual property  
4.30.  In the last four years the Brazilian Government has consistently invested in expanding and 
modernizing its patent office, the National Institute of Industrial Property (INPI). This underlines 
the relevance attributed to the protection and enfo rcement of intellectual property by Brazil as a 
venue for further social and economic development of the country, therefore promoting technological innovation while ensuring a balance of rights and obligations, to the mutual advantage of producers and users of technological knowledge.  
4.31.  The most relevant effort carried out in the recent past is the modernization of INPI. Patent 
offices in developed as well as in developing countries face the challenge of coping with a continuous rise in the backlog of IP applications. This brings the necessity of reducing the time 
lapsed between the deposit of the application and the final decision by the Offices while 
simultaneously maintaining the quality of examination. INPI has accordingly increased the number of examiners, in particular in its Patent Director ate, with a first group of 250 new examiners hired 
in 2013 and the goal of reaching 700 patent exam iners in 2015, a projected threefold increase. 
The premises and the technological infrastructure of INPI were also renewed, providing it with 
state-of-the-art equipment and databases. The Institute has developed a number of systems in order to streamline its internal process, eliminate redundant actions and increase the productivity 
of examiners; the most relevant is the on-line application system denominated "e-patentes", which 
allows the applicant to deposit the application an d follow all examination phases on the internet, 
including the issuance of letter-patents. These changes are intended to provide adequate 
infrastructure to address the rising number of patent applications, which have increased by almost 
50% since 2009.  
4.32.  It is also worth mentioning PROSUR, a cooperation project on industrial property among the 
Offices of nine South American countries, namely  Argentina, Brazil, Chile, Colombia, Ecuador, 
Paraguay, Peru, Suriname and Uruguay. PROSUR aims  at (i) establishing a forum for the dialogue 
between offices, (ii) creating a common portal in order to offer a set of services for the South American users, such as centralized search in interconnected databases, (iii) database 
interconnection, and (iv) collaborative examination of patent applications. PROSUR’s current WT/TPR/G/283/Rev.1 • Brazil 
 
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  institutional framework is a Cooperation Agreement between the Offices signed in Santiago, Chile, 
on 5 July 2012. PROSUR’s goal, in a nutshell, is to deepen the cooperation among Offices while maintaining their autonomy to use the information accrued from the Project. It is expected that 
the work carried out under the project will allow O ffices to reduce their backlogs and strengthen 
the quality of their examination.  
4.33.  The National Council to Combat Piracy and Crimes against Intellectual Property (CNCP) was 
established in 2004 following the conclusion of a Parliamentary Commission that recommended 
actions to strengthen coordination among government  agencies involved in the fight against piracy 
and counterfeiting. The Council is responsible for the design and implementation of the National 
Plan to Combat Piracy and Other Crimes against Intellectual Property and comprises representatives from both the Government and the private sector, including right holders and the 
civil society. By bringing together private entities and Government representatives, with equal 
rights to voice and vote, in a joint council, the Brazilian initiative is unique and innovative.  The underlying assumption of the Council is that the combat against IPR violations involves measures 
to constrain the supply of such goods – through repressive activities – as well as those measures 
to address the demand of such goods – by ed ucative and economic activities. Thus, in its 
activities, CNCP has a three-pronged approach: repressive, economic and educative.  
4.34.  The work of CNCP has produced, in certain areas and sectors, a decrease in the volume of 
commerce of items which violate intellectual property  rights. This is a by-product of enforcement 
action but also of a shift both in consumer awarene ss of the negative effects of piracy in Brazil and 
in the business strategies of companies which have acknowledged the economic nature of the 
problem and decided to lower prices in order to reach out to lower-income classes. It is expected 
that the work of the Council will continue to build up respect for IP rights in a balanced way, ensuring also that the abuse of enforcement mech anisms by right-holders is effectively curbed.  
4.2  Sectoral Issues 
4.2.1  Industry  4.35.  The global economic crisis that started in  2008 affected significantly the performance of the 
industrial sector in Brazil. From 2004 to 2008, the industrial sector showed positive growth rates. 
After an abrupt slowdown in 2009 (-7.3%), the industrial sector recovered in 2010 (10.6%). From 2010 to 2011, aggregate growth rates were positive, led by capital goods (21.1% in 2010, 3.6% in 2011) and intermediary goods (11.4% in 2010, 0.2% in 2011). Industrial production has 
tended, however, to lag GDP growth: 0.3% in 2011 and -3.6% in 2012, compared to GDP growth 
of 2.7% and 0.9% respectively. 
4.36.  The trade balance in the industrial sect or has shown significant and growing deficits: 
US$38.8 billion in 2009, US$50 billion in 2010, and US$65.8 billion in 2011. From 2008 to 2011, 
the share of imported manufactured goods in total consumption increased by 27%. To a large extent, this is a reflection of the slump in demand in major developed economies, which reduced 
Brazilian exports and increased competition from cheap imports in domestic markets, and of the 
exchange rate misalignments: the exchange rate to the US dollar moved from R$2.33 in late 2008 to R$1.66 in 2010. 
4.2.2  Agriculture  
4.37.  Brazil's long-standing agribusiness compet itiveness and the trend of its production and 
exports have been supported by sustained investme nts in agricultural research, rising commodity 
prices and record grain production, consolidating the country leadership as a major agricultural 
producer and exporter.  
4.38.  In the period 2009-12, gross agricultural domestic product increased approximately 25%, 
reaching US$92.6 billion. Agricultural and agribusiness exports increased about 50% in the same 
period. 
4.39.  Brazilian grain production in 2011-12 reache d the record amount of 166.2 million tons, 23% 
higher than in 2008-2009, in spite of adverse weather conditions in Southern Brazil, one of the country’s most important agricultural regions. WT/TPR/G/283/Rev.1 • Brazil 
 
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  4.40.  Brazilian agricultural policy follows a ma rket-oriented approach, emphasizing rural credit 
and risk management based on private rural insurance. Rural credit relies largely on private sources, and has increased steadily. Market price su pport is limited, consisting in the payment of 
premiums determined in a limited number of public auctions. 
4.41.  The main sources of agricultural financing are resources from demand deposits and rural 
savings compulsorily destined for rural credit, and credit lines managed by the National Economic and Social Development Bank (BNDES), as well as  the "Constitutional Funds" aimed at reducing 
regional inequalities and promoting social and economic development through the financing of 
agriculture, agro-industry and other sectors, in addition to infrastructure, innovation and technology. These funds are targeted to the North, Northeast and Centre-West regions (FNO, FNE and FCO). 
4.42.  Since June 2012, the share of mandatory resources devoted to rural credit increased, 
respectively, from 28% to 34% of demand deposits and from 65% to 68% of rural savings. The latter rate was set to be re duced to 66% by May 2015. 
4.43.  The low carbon agriculture program ("Programa ABC") was set up to finance agricultural 
practices aimed at reducing greenhouse gas emissions, encompassing investment programs to support the recovery of forests (PROFLORA) and sustainable agricultural production PRODUSA).  
4.44.  In 2012 the PROCAP-AGRO investment program was created with the objective of 
increasing the capital of agricultural cooperatives by providing preferential credit for the acquisition of capital shares.  
4.45.  In 2009 the Federal Government launched the Sustainability of Investment in Capital Goods 
Program (PSI-BK) for a wide range of sectors, in cluding agriculture (under the "PSI Rural"). PSI 
Rural covers investments in agricultural capita l goods financed by the (BNDES). The Growth 
Acceleration Program (PAC), launched in 2007 and renewed in 2011 (PAC 2), includes investments 
in logistics, energy and social development that  should further enhance the competitiveness of 
Brazilian agriculture. 
4.46.  According to the OECD Producer Support Estimates (PSE), Brazil is one of the countries that 
provide the least subsidies to agricultural producers, well below the OECD average. Brazil's price 
s u p p o r t  m e c h a n i s m s  t o  f a m i l y  f a r m e r s  h a v e  b e e n  r e g a r d e d  b y  O E C D  s t u d i e s  a s  n o n - m a r k e t -distorting schemes, given the limited subsidies granted to commercial farmers facing high production and commercialization costs due to infrastructure deficiencies and long distances from 
ports and main domestic markets. 
4.47.  Family farming, comprised of small and medium-scale operations, account for 10% of GDP 
and for 33% of the value of agricultural producti on. This sector generates 12 million jobs, or 74% 
of all jobs in the country’s agricultural sector. Family farmers produce approximately 70% of the 
food consumed by the Brazilian population and are thus essential for the country's food and 
nutritional security. Public agricultural policies for this sector, such as credit, technical assistance, 
public procurement, aim at enhancing its capacities in order to ensure the nation’s internal supply, 
increasing agricultural incomes and strengthening local markets. 
4.2.3  Services  4.48.  The service sector has held a steady share of GDP since 2007, with the latest available data 
from 2011 showing 67% of participation of the sector  in GDP. In terms of employment, the tertiary 
sector (including the public sector) accounted for 78% of formal jobs in 2011, according to the Brazilian Institute for Geography and Statistics (IBGE). Brazil has faced growing deficits in trade in 
services in recent years. In 2011, the deficit in services trade increased 23.8%, reaching 
US$36.7 billion. 
4.49.  From 2010 to 2011, services exports grew by 21% (compared to a world rate of 7.8%). 
Brazil ranks 30
th among the world's largest services exporters. On the other hand, Brazilian 
services imports increased 22.4% in the same period, placing Brazil as the 17th top services 
importer in the world, with a 2% share of the world total imports. WT/TPR/G/283/Rev.1 • Brazil 
 
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  4.50.  According to the Balance of Payments' services account – which exclude government 
services, in accordance with the IMF standard – "business, professional and technical services" accounted for 47.6% of Brazilian revenues in servic es in 2011, followed by "international travel", 
with 17.6%, and "transportation", with a 15.1% share. "Financial services", which accounted for 
6.9%, was the sector with the best performance in comparison to the previous year, with a 28.4% 
increase from 2010 to 2011.  
4.51.  "International travel", "rental of equipment" and "transportation" accounted for the bulk of 
Brazil's trade deficit in services in the period under review (27.8%, 21.9% and 18.5% of the total 
expenditure in services accounts, respectively).  
4.52.  Brazil's most significant trade partner for services, in 2011, was the US, which accounted for 
44.4% of Brazil's export revenues, followed by  the EU (26.2%) and Latin America, including 
MERCOSUR (6.7%). The EU was the main source of services imported by Brazil (47.1%) in 2011, 
while the US accounted for 29% and Latin America for 5.9%. 
4.53.  The Brazilian Government is currently implementing initiatives to improve information on 
the country's foreign trade in services. One of the innovations introduced to monitor foreign trade 
of services is the SISCOSERV – Integrated System of Foreign Trade in Services, Intangibles and other Operations that Produce Variations in the Capital of the Entities. SISCOSERV started 
operating on 1 August 2012. It records foreign trade transactions in services and intangible 
transactions between residents and non-residents. The system is not used for compliance with licensing requirements or other types of control. The system is an important tool for the formulation and monitoring of public policies an d for gathering statistics on foreign trade in 
services, covering all positions of the UN Central Products Classification and the four modes of 
supply in accordance to the General Agreement on Trade in Services (GATS) of the WTO. It is jointly managed by the Federal Revenue Secretar iat of the Ministry of Finance (SRF) and the 
Secretariat of Commerce and Services of the Ministry  of Development, Industry and Foreign Trade.  
4.54.  SISCOSERV uses the Brazilian Nomenclature of Services and Intangibles (NBS), along with 
its Explanatory Notes (NEBS). The NBS and the NEBS, jointly developed by the Ministry of 
Development, Industry and Foreign Trade and the Mi nistry of Finance, are in accordance with well 
established international technical standards and are harmonized and compatible with the most commonly used international product classification, namely version 2.0 of the CPC/UN. The 9-character nomenclature, spanning a wide and thorough range of service products divided into 
27 chapters, is currently undergoing public consultation for final adjustments. 
4.2.4  Renewable energy  4.55.  Brazil has one of the world's cleanest en ergy mixes. 44.1% of primary energy sources are 
renewable, compared to a world average of 13.3% and 8% in OECD countries. It is forecast that 
renewable sources will continue to account for a large share of supply, mostly due the use of hydropower and bioenergy, including biofuels. On ly 30% of Brazil’s hydroelectric potential has 
been exploited. The potential for increased production of this renewable and affordable energy 
source is an integral part of the country's long-term strategy for the sector. Widespread access to affordable energy is crucial to achieving the go als of sustainable development, promoting social 
inclusion and poverty reduction; promoting national integration and the reduction of greenhouse 
gas emissions; and contributing to improve the ec onomy's competitiveness. Brazil is, therefore, 
investing significant amounts in research and in new technologies to improve the generation and distribution of energy.  
4.56.  Brazil also considers bioenergy, including biofuels, an indispensable tool for the expansion 
and diversification of the energy matrix. Nowadays, biomass electricity – generated mostly from sugarcane processing plants – accounts for about 8% of Brazil’s total energy consumption. 
By 2021, biomass and wind generation are expected  to supply 16% of the country's energy needs. 
In the transportation sector, the use of ethanol and biodiesel plays a key role in the pursuit of sustainable development, climate change mitigation  and energy security. The Brazilian case shows 
that the long term and large scale sustainable pr oduction and use of biofuels are possible, and 
Brazil continues to work towards the creation of an international market for biofuels. WT/TPR/G/283/Rev.1 • Brazil 
 
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  4.2.5  Land transport  
4.57.  The Brazilian Government has given priori ty to the development of land transport by 
investing heavily in infrastructure, in order to ensure permanent trafficability, as well as to 
improve safety and comfort in federal highways.  
4.58.  The Government is investing US$45 billion to expand the Brazilian rail network 
by 10,000 km. US$21 billion will be invested in the duplication of highways across the country. In both cases, investments must be concentrated in the first five years of the concession. 
4.59.  In the case of railway concessions, the first batch will involve 2,600 km and the second, the 
remaining 7,400 km. All notices will be published in 2013. The auction for the concession of the 
High Speed Train Rio de Janeiro–São Paulo–Camp inas is planned for the second half of 2013. 
4.60.  Other projects approved in 2012 include th e construction and/or expansion of urban train 
lines in Salvador, Belo Horizonte, Fortaleza, Porto Alegre, Curitiba, Brasilia and Rio de Janeiro, with 
an estimated investment of US$8 billion. 
4.2.6  Air transport  
4.61.  Brazil is the world's fourth largest aviation  market and has expanded fast during most of the 
period under review. Spurred by strong econom ic growth, between 2007 and 2010 Brazil's regular 
domestic and international passenger traffic grew by 53% and 57%, respectively, in terms of paid-
seats per km flown. In 2010, Brazilian airlines served 71.4 million passengers on domestic flights. 
Out of 14.9 million passengers on international fl ights, 5.5 million flew on Brazilian airlines 
and 8.4 million on foreign airlines. 
4.62.  Until recently, the responsibility for formulat ing and implementing the civil aviation policy in 
B r a z i l  r e s t e d  p r i m a r i l y  w i t h  t h e  M i n i s t r y  o f  Defense. However, Law 12.462 of 4 August 2011, 
created the Civil Aviation Secretariat (SAC), directly  linked to the Chief of Staff Office and headed 
by a Secretary with ministerial status (Chief-Minister) who took over some of the civil aviation 
functions previously exercised by the Ministry of Defense. 
4.63.  Hence, SAC/PR is now responsible for, inter alia , formulating policies and strategic plans for 
the development of the civil aviation sector, over seeing plans to open up airport investment to 
private companies, approving concessions to build new airports and terminals, and delegating to 
the States, Federal District and municipalities the management, operation, and maintenance of 
public airfields. 
4.64.  The new Secretariat is also responsible for coordinating the activities of other government 
entities involved in civil aviation, and for establishing directives for Brazil's participation in 
international civil aviation conventions and agreements. The Civil Aviation Council (CONAC), previously chaired by the Minister of Defense, is now chaired by the Secretary Chief-Minister of 
Civil Aviation and is in charge of advising the President on matters of civil aviation policy and 
setting guidelines for the sector. 
4.65.  The National Civil Aviation Agency (ANAC) , created in September, 2005, is responsible for 
the regulation and safety/security oversight of civil aviation in Brazil. Negotiations of treaties and 
agreements on International Air Transport are conducted by the Agency, in coordination with the Ministry for External Relations and the Civil Aviation Secretariat.  
4.66.  During 2012, 11 Air Service Agreements (ASA)  were celebrated or renegotiated, with the 
following countries: Albania, Azerbaijan, Burkina Faso, Ecuador, Guatemala, Jordan, New Zealand, 
Saudi Arabia, Sierra Leone, Switzerland and Uruguay. At the closure of the 20
th Ordinary Assembly 
of the Latin American Civil Aviation Commission (LACAC), in Brasilia, 8 November 2012, Brazil 
acceded to the LACAC Multilateral Open Skies Agreement. The Agreement is expected to lead to an 
increasing number of available flights in the regi on and opens up the possibility of new routes and 
greater connectivity between Latin American countries. 
4.67.  Decree 7.624, of 22 November 2011, established the conditions for the exploitation of 
airport infrastructure by private operators through concessions. All concessions must obtain prior WT/TPR/G/283/Rev.1 • Brazil 
 
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  approval from the Civil Aviation Secretariat, whil e ANAC is in charge of carrying out the bidding 
procedures. In February 2012, ANAC auctioned the concessions for the operation of the airports of Guarulhos (São Paulo), Campinas/Viracopos (S ão Paulo) and Brasilia (Federal District). 
4.2.7  Ports and maritime transport  
4.68.  In December 2012, the merchant fleet registered under the Brazilian flag (long-haul and 
cabotage) consisted of 155 vessels, operated by 36 shipping companies and with a total capacity of 2.9 million deadweight tons (DWT). Oil tanker s represent 47% of total DWT capacity, followed 
by bulk carriers (20%), container ships (14%) an d general cargo vessels (4%). The predominance 
of oil tankers and bulk carriers reflects the ov erall structure of Brazilian exports of goods, 
comprising mainly oil, iron ore, soybeans, sugar and other commodities.  
4.69.  With a coastline of 8,500 km, the transp ortation of goods and passengers by coastal 
shipping (cabotage) in Brazil has increased in recent years, and growth potential is still significant. 
Economic growth in the country's North and Northeas tern regions, as well as the rising purchasing 
power of the emerging middle-class have created opportunities for the development of costal 
shipping in Brazil. 
4.70.  Brazil's port infrastructure handled 904 million tons of goods traded in 2012. This is 
equivalent to 80% of the total value of the count ry's foreign trade in the same year (85% of 
exports and 76% of imports) and to 97% of tota l foreign trade by tonnage (98% of exports and 
90% of imports). Between 2002 and 2012, the total movement of cargo in ports and terminals in Brazil grew 5.6% annually (from 529 to 904 million tonnes). During this period, the movement of containers grew 9.9% per year in tonnes. 
4.71.  Out of the 34 maritime public ports in Br azil, 16 had their administration under concession 
or referred to state or local governments. The other 18 are administered directly by the "Companhias Docas". The majority of the stock of "Companhias Docas" is held by the Federal 
Government, under the supervision of the Secretariat of Ports (SEP/PR). There are 125 private 
terminals. 
4.72.  A major area of operation by SEP refers to the two phases of the PAC (PAC 1 and PAC 2). 
The priority is the maintenance, restoration and expansion of port infrastructure. Altogether, 
R$7.5 billion will be invested in ports. Under PAC 1, the Federal Government allocated around R$1.6 billion to the National Dredging Program (PND), R$1.8 billion to improving port infrastructure and R$50 million to logistics and intelligence. Under the PAC 2, planned investments 
for the period 2011 to 2014 are approximately R$1 billion for the National Dredging Program, 
R$2.8 billion in port infrastructure and R$350 million to logistics and intelligence. 
4.73.  The SEP also develops the "Paperless Port", a port data concentrator system establishing a 
single virtual document to process and distribute real-time information necessary for the 
functioning of the sector. Its implementation in full scope, will integrate the agencies and ministries concerned and give more speed to oper ations, reducing operating costs. The project will 
improve the performance of port operations by abou t 60% and reduce the length of stay of vessels 
in ports by 25%. 
4.2.8  Telecommunications  4.74.  The Brazilian telecommunications market continued to grow rapidly during the 
period 2009-12, particularly driven by the expa nsion of mobile data services and broadband 
Internet access. Investment in the telecommunication sector increased from R$18.9 billion in 2008 to R$25.3 billion, in 2012.  
4.75.  The mobile telephony market boomed during  the years under review: the number of mobile 
telephone subscriptions reached 261.8 million in December 2012, with teledensity rising to 132.8 mobile lines per 100 inhabitants. Some 81% of mobile lines are pre-paid.  
4.76.  Internet usage also reported impressive growth, spurred by increased broadband access 
across the country, following initiatives by the Government to expand access and make broadband connections more affordable under the National Broadband Plan. The deployment of 3G networks WT/TPR/G/283/Rev.1 • Brazil 
 
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  in Brazil significantly expanded mobile broadband  access in recent years, reaching 65.9 million 
subscriptions by December 2012. The number of fixed broadband subscriptions has also shown 
solid growth. There were 20 million fixed broadband connections in late 2012.  
4.77.  In contrast, the number of fixed telephone lines grew slowly during the period under review, 
with only a slight increase in the teledensity level, which stood at 22.3 lines per 100 inhabitants 
in 2012 (21.7 lines per 100 inhabitants in 2008). In December 2012, there were 16.2 million pay TV subscriptions, of which 38.3% used cable technology.  
4.78.  Today, Brazil's telecommunication sector is fully open to competition and continues to 
attract new entrants. In 2012, the leaders of the fixed-line telephone market were Oi, with a 42.03% market share, Telefônica Brasil with  23.78%, Embratel (América Móvil) with 21.85% and 
GVT with 8.22%.  In the mobile market, the largest operator was Vivo (owned by Telefónica), with 
a 29.08% market share; followed by Tim (Telecom Italia) with 26.88% of the market; Claro 
(América Móvil) with 24.92%; and Oi with 18.81% (December 2012).  Three other operators shared the remaining 0.31% share of the mobile market. The fixed broadband sector was led by 
Oi, accounting for 31.50% of the market by December 2012; its closest competitor was NET 
Serviços (operating in partnership with Embrat el; both owned by América Móvil) with a 28.37% 
market share. Other fixed broadband operators we re Telefônica Brasil, GVT, Sercomtel and CTBC. 
The major operators in the pay TV market included Net Serviços/Embratel, Sky/DirecTV, Oi, 
Telefônica and GVT.  
4.79.  The National Broad Band Plan (PNBL) was instituted by Decree 7.175 of 13 May 2010, with 
the aim of boosting access to broadband servic es across the country and bridging the digital 
divide, in collaboration with private operators. The plan consists of a series of actions in several 
dimensions, including spectrum auctions to increase mobile broadband coverage (4G and telecommunications services for voice and data in rural and remote regions), the implementation 
of a national transmission network (backhaul an d backbone), Agreements for the expansion of 
commercial broadband offers at low prices and regulatory  measures aimed at promoting greater 
competition and network expansion. 
4.80.  Regarding technological convergence measures, Law 12.485, of 12 September 2011, 
changed and unified the regulatory framework for pay TV services. It removed the limit on foreign investment in cable TV (which did not apply to pay TV services provided through MMDS or DTH technologies). Law 12.485 also eliminated previous limitations on fixed-line telephony 
concessionaires to provide cable-TV services and removed regional restrictions on telecom 
operators, allowing them to provide pay TV services anywhere in Brazil.  
5  FUTURE DEVELOPMENTS  
5.1.  Despite the uncertainty regarding the intern ational economy, the outlook is for continued and 
steady growth of the Brazilian economy in the co ming years. Expectations of market analysts 
collected by the Central Bank of Brazil forecast growth of 3.03% in 2013 and 3.5% in 2014. 
5.2.  Brazil continues, however, to suffer th e effects of expansionary monetary policies in 
developed countries on its exchange rate and terms of  trade. As a result of these actions, in recent 
years the Real has been overvalued compared to its equilibrium real rate, resulting in unfavorable conditions of competition for Brazilian producers against imported products. This has led to a 
reduction in the share of the industrial sector in GDP, from 23.7% in 2008 to 22.3% in 2012. 
Exports of industrial products fell, as a percentage of total exports, from 60.5% in 2008 to 51.01% in 2012. 
5.3.  In order to strengthen the country's ability to face the global crisis, the Federal government 
launched "Plano Brasil Maior", with a focus on industrial competitiveness, technological development and foreign trade. Among the priority  actions are the reduction of labor and capital 
costs, the development of production chains, ex port promotion and the modernization of trade 
defense instruments. One of the objectives is to simplify and streamline the tax collection system, with a view to reducing the complexity and weight  of the tax structure. Particular attention will 
continue to be paid to the reduction of payroll taxes, as well as to harmonizing the collection of 
taxes at the state level and to reducing the cost of tax compliance. WT/TPR/G/283/Rev.1 • Brazil 
 
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  5.4.  The Government will continue to attach priority to initiatives aimed at strengthening small 
and medium enterprises (SMEs), due to their important social role in creating jobs and expanding the formal labor market. According to the latest official data, SMEs account for 20% of GDP, 60% of the 94 million jobs in Brazil and 99% of the 6 million formal business establishments in the 
country. In order to support entrepreneurship, the Government developed a simplified tax system: 
the "Simples Nacional". As a result of the progressive expansion of "Simples Nacional", as well as the support of SEBRAE (Brazilian Service of Support for Micro and Small Enterprises), more 
than 2.8 million micro and small enterprises (MSEs)  and over 1.6 million individual entrepreneurs 
(EI) are expected to join the formal economy by 2015. 
5.5.  In order to foster the current process of growth and social inclusion, the Government will 
continue to promote the improvement of infrastr ucture. PAC projects are clustered around the 
areas of Transportation, Energy, Urban Infrastructu re, Housing and Social Services. At the end of 
its second year, the overall execution of the se cond phase of the Growth Acceleration Program 
(PAC 2) reached R$472.4 billion, out of an expe cted total investment of R$958.9 billion for the 
period 2011-14. For the post-2014 period, an additional investment of R$631.6 billion in 
infrastructural works is estimated, bringing the total to R$1.59 trillion. 
5.6.  A major challenge lies in ensuring the cont inued improvement of the educational level of the 
population. In addition to comprehensive pr ograms aimed at improving basic and higher 
education, the Government will continue to strengthen actions directed at enhancing the qualification of the workforce. These efforts are deemed essential to increase the level of productivity of the economy and the promotion an d attraction of productive investments. The 
National Education Plan (PNE) 2011-2020, currently under revision by Congress, lays down the 
main objectives in this area, including the complete eradication of illiteracy by the end of the period and raising Brazil’s Basic Education Development Index at all levels, especially in high 
school.  
5.7.  With regard to social policies, there wa s a marked expansion of the Brazilian middle class 
over the last decade. An additional 15 million peop le are forecast to join the middle class by 2014, 
reaching 59% of the total population. Guaranteed income policies should continue to contribute 
towards the process of reducing social inequality and of socioeconomic inclusion of the poorest, with a strong impact on the consumption capacity of lower income sectors. 
5.8.  The Brazilian Government is committed to continue to manage its accounts in accordance 
with the principle of fiscal responsibility. The IMF projects that Public Sector Net Debt, which 
currently stands at 35% of GDP, will be reduced to 26% of GDP in 2017. 
5.9.  In the face of an external deflationary sce nario – and in a context of positive fiscal results 
and consistent inflation target regime – the Central Bank of Brazil in recent years reduced the 
benchmark interest rate (SELIC) to its lowest ever levels both in nominal and real terms. This was reflected in the financial system, where bank spreads and interest rates on loans also reached 
record lows. Real interest rates are expected to re main at these subdued levels in the near future. 
5.10.  The financial system is anticipated to rema in solid, given the sound economic fundamentals 
and continued operations in strict accordance with the Basel principles of banking supervision. Nevertheless, Brazil still has a relatively underdeveloped long-term financial market compared to 
advanced economies, and the Government is eager to create conditions for the development of a 
private long-term credit market. To do so, it has stimulated the creation of new financial instruments, such as debentures and Infrastr ucture Investment Funds (FIDC), Encouraged 
Debentures Funds, Infrastructure and Investment  Participation Funds in (FIP-IE), among others. 
These new instruments should lead to a more significant participation of private capital in long-term financing operations in the coming years. 
5.11.  Reinforcement of the multilateral trading sy stem will remain a priority. In light of the 
diversified nature of its trade and production structures, Brazil has a major stake in a smoothly operating system of multilateral trade rules that is able to provide the basis for the expansion of 
international trade on a non-discriminatory basis. Brazil will continue to play an active role in the 
WTO. It continues to believe that concluding the Doha Round on the basis of its development 
objectives would greatly contribute to making the multilateral trading system more efficient, open and equitable. WT/TPR/G/283/Rev.1 • Brazil 
 
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  5.12.  The strengthening and development of MERCOS UR will continue to be a major component of 
Brazil’s trade policy strategy. The recent accession of Venezuela, the prospect of further expansion, the possibility of further expanding ex isting trade agreements within the region – as 
well as the establishment of new agreements with other countries and groups of countries – will 
promote integration and development, to the benefit of all countries in the region. 
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