- Country or region
- Brazil
- Trade topics
- Dispute settlement
- Dispute settlement
- WTO - Case launched by the EU
Summary of the case
- Complaint by: EU
- Complaint against: Brazil
- Third parties: No third party
Brazil makes use of selective exemptions or reductions from Federal taxes on domestic goods to provide advantages to domestic industries and to shelter them from competition. Many products, ranging from computers and smartphones to motor vehicles are the object of tailor-made discriminatory tax programmes.
Furthermore, tax benefits are also reserved for goods produced in certain areas in Brazil, whatever the sector. The Brazilian authorities have also broadened existing systems of tax exemptions for Brazilian exporters by enlarging the number of potential beneficiaries. These tax measures have a negative impact on EU exporters, whose products face higher taxes than domestic competitors. In addition, the measures restrict trade by favouring the localisation of production and supplies, and give an advantage to Brazilian exporters.
The measures also result in Brazilian consumers facing higher prices, less choice and lower access to innovative products.
Relevant WTO provision: ARTICLES I:1, II:1(b), III:2, III:4, and III:5 of the GATT 1994; ARTICLES 2.1 and 2.2 of the TRIMS agreement; ARTICLE 3.1(a) and (b) of the SCM agreement
Status
Panel stage
- Consultations requested: 19 December 2013
- Panel requested: 31 October 2014