Trump extends decree that maintains sanctions on Brazil, but measure should have no effect on tariffs

The renewal does not create new penalties or expand the measures already adopted against Brazil in the case of tariffs. The use of this law to overtax countries was overturned by the Supreme Court and, therefore, this renewal should have no practical effect on Brazil with regard to the export of products.

The decision will be published this Wednesday (29) in the Federal Register, the Official Gazette of the USA, and meets the requirement of the NEA (National Emergencies Act), according to which a national emergency automatically expires after one year.

Former director of the WTO (World Trade Organization), Roberto Azêvedo told Folha that, although IEEPA cannot be used to tax other countries, the measure extends the application of financial sanctions against Brazilian authorities under this legislation.

"The Supreme Court overturned all tariff elements that were being applied to IEEPA. Now, everything that is not a tariff continues", he says.

In addition to tariffs, IEEPA is also the legal basis for US economic sanctions, such as freezing the assets of individuals linked to organizations designated as terrorists, including the PCC and Red Command.

When justifying the renewal, Trump reiterated the accusations made against the Brazilian government last year. According to the document, Brazil's policies and actions continue to represent an "unusual and extraordinary threat" to the national security, foreign policy and economy of the United States.

In the document, the White House recalls that the measure was adopted to deal "with the unusual and extraordinary threat to US national security, foreign policy and economy".

It also says, without naming former president Jair Bolsonaro, that "members of the Brazilian government are politically persecuting a former president of Brazil, his family and his followers, which is contributing to the deliberate breakdown of the rule of law in Brazil, politically motivated intimidation in that country and human rights abuses."

"Certain activities, such as the censorship and imprisonment, by the Federal Supreme Court of Brazil, of people exercising their freedom of expression, and the censorship of online content, continue to represent an unusual and extraordinary threat - originating, wholly or substantially, outside the United States - to the national security, foreign policy and economy of the United States", completes the document.

This law was used last year for the Trump administration to apply a 40% surcharge on Brazilian products, which was added to the 10% tariff announced at the beginning of the administration. Ao todo, o Brasil foi sobretaxado em 50% -porém, as tarifas caíram, parte delas após a reaproximação entre Trump e o presidente Lula (PT) e, meses depois, após a Suprema Corte suspender o uso tarifário da IEEPA por Trump.

Despite this, Brazil now faces other tariffs, which were announced throughout July, add up to 37.5% surcharges on Brazilian products and are the result of two investigations by the USTR (US Office of Trade).

In the first of them, Brazil was accused of unfair commercial practices, including Pix and social media censorship, and for this reason it was sanctioned with 25% - despite having an extensive list of exceptions. The other is the investigation in which Brazil was included, as well as 59 other economies, for allegedly failing to combat forced labor.

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