Brazil's attempt to assert national control over its digital markets faltered as the Chamber of Deputies pushed back a vote on Bill 4.675/2025, the Fair Competition in Digital Markets bill. This deferral follows a 25% tariff imposed by the United States on many Brazilian goods, effective 22 July this year, a direct consequence of a Section 301 trade investigation that specifically named Brazilian digital regulation. The bill, intended to amend Law 12.529/2011, would have granted CADE, Brazil’s competition regulator, pre-emptive powers over major digital platforms.
The proposed legislation aimed to designate certain platforms as systemically relevant, then impose obligations in advance. These obligations included limits on self-preferencing, duties to ensure interoperability with rivals, transparency regarding algorithms, and mandatory notification of acquisitions. Such a framework would have made Brazil one of the largest democracies outside the European Union to regulate big tech in this manner, shifting from punishing abuse after it occurs to setting rules upfront.
External Pressure Mounts
The changes to the bill and the vote's postponement did not happen in a vacuum. The United States closed its Section 301 trade investigation into Brazil on 15 July this year, announcing the tariffs just days later. Twenty Republican members of Congress had previously written to the US Trade Representative in late July, explicitly citing Bill 4.675/2025. This foreign intervention directly targeted Brazil's legislative efforts to regulate its own digital economy.
Alongside this external governmental pressure, significant platform lobbying efforts ran parallel, further influencing the legislative process. Opposition within Brazil's own Congress also contributed to the bill's contested status. The combined weight of these transnational and internal elite interests proved sufficient to narrow the scope of national regulatory power.
National Control Erodes
The original text set revenue thresholds at approximately R$50 billion in global revenue or R$5 billion in Brazil. While these thresholds remained, the criteria for designating a platform as systemically relevant were significantly tightened. The initial bill allowed separate consideration of data volume, user numbers, and gatekeeper characteristics. The revised text now mandates these factors be assessed jointly, making the designation much harder to apply.
Deputy Aliel Machado, the rapporteur, circulated the substitute text between late June and mid-July, framing these concessions as adding "legal certainty." CADE’s acting president, Diogo Thomson de Andrade, has publicly stated the regulator is "open to changing wording that is not clear." Furthermore, the rapporteur’s office confirmed that a designation would now last for a maximum of six years, a reduction from the ten years initially proposed, with a possibility of review after two years if market conditions shift significantly. These adjustments reflect a retreat from robust national oversight.
The Cost of Compliance
While the competition aspect of the bill has been deferred, decrees published on 21 May this year concerning platform content moderation remain fully in force. Courts have declined to suspend these measures. This distinction is critical: the ability of the Brazilian state to dictate what platforms must remove from their services remains, but its power to dictate how the largest platforms behave in the market, protecting national interests, has been curtailed. The vote on the competition piece has not yet been rescheduled, leaving Brazil's digital landscape vulnerable to unchecked transnational corporate power and foreign economic coercion.