President Luiz Inácio Lula da Silva signed on this Monday (14) the decree that regulates the Commercial Reciprocity Law. The information was confirmed by Chief of Staff Minister Rui Costa in a statement to the press after an event at the Palácio do Planalto.
The content of the decree will be published in a regular edition of the Official Gazette of the Union (DOU).
The regulation authorizes the Brazilian government to adopt commercial measures against countries that impose unilateral barriers to Brazilian products in the global market. The measure can be used to respond to the 50% tariff imposed on all Brazilian exports to the United States (US), starting August 1st, as announced last week by U.S. President Donald Trump.
According to Rui Costa, the decree does not specifically mention any country and establishes the mechanisms necessary to comply with the law.
“The term ‘reciprocity’ can also provide a quick response if another country takes measures similar to those announced by the United States,” he explained.
Background
Approved in March by the National Congress and sanctioned in April, the new law is a direct response to the escalation of the trade war unleashed by Donald Trump against dozens of countries.
In Brazil’s case, the tariff initially imposed by the US was 10% on all products exported to the U.S. market. Steel and aluminum are exceptions to this tariff rate, with the surtax imposed by the Americans at 25%, significantly affecting Brazilian companies, which are the third largest exporters of these metals to the U.S.
The Commercial Reciprocity Law establishes criteria for responses to unilateral actions, policies, or practices by a country or economic bloc that “negatively impact Brazilian international competitiveness.”
The regulation will apply to countries or blocs that “interfere in Brazil’s legitimate and sovereign choices.”
Article 3 of the text, for example, authorizes the Strategic Council of the Foreign Trade Chamber (Camex), linked to the Executive Branch, to “adopt countermeasures in the form of restrictions on imports of goods and services,” while also providing for negotiations between the parties before any decision.
Emergency Committee
To discuss how to respond to the U.S. tariffs, the government also established an interministerial working committee, with participation from business sectors in industry and agribusiness.
The board’s first meetings will take place this Tuesday (15), led by Vice President Geraldo Alckmin.
Source: Agência Brasil