On October 19, 2020 the United States and Brazil signed a new Protocol relating to Trade Rules and Transparency. This Protocol updates the 2011 Agreement on Trade and Economic Cooperation (ATEC) with three new annexes comprising state-of-the-art provisions on Customs Administration and Trade Facilitation, Good Regulatory Practices, and Anticorruption.
The bilateral trade relationship under improvement has been approved by the Brazilian House of Representatives which by October 26, 21 has approved aforesaid Protocol now already moving on to be endorsed by the Senate as well.
Those instruments are part of a broader context regarding Brazilian foreign trade policy, whose main objective has been to create a favorable and transparent economic environment for business development, as well as to insert the Country in a competitive position in favor of its national companies to get better results in international deals.
The enhancement of the economic-commercial partnership has been grounded by those commitments, which also serves as a foundation and premise for future developments, such as the eventual execution of a broader and more comprehensive free trade agreement between Brazil and the US, as well as the Agreement to Avoid Double Taxation.
Trade facilitation rules and, above all, the adoption of updated regulatory practices regarding the discipline of international trade by the parties, as well as anti-corruption rules, are fundamental for Brazil to entry the Organization for Economic Cooperation and Development (OECD) a target that has been strongly pursued by the country, and is considered a spot of its foreign affairs policy.
Protocol encompasses current rules in the areas of trade facilitation, goods regulatory practices and the combat of corruption, consolidating discussions that have taken place between the two countries since 2015. The commitment on Trade Facilitation and Customs Administration fosters more efficient and transparent customs procedures, leading to a reduction bureaucracy and costs, increasing agility and predictability for exporters and importers.
The approval of the Agreement by the Senate will also generate concrete economic gains for Brazil from the reduction of costs in foreign trade standpoint, as well as increase the predictability and legal certainty in businesses involving the United States, contributing to boost the mutual trade and investment initiative for the benefit of both parties.
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