The President of Brazil, Jair Bolsonaro, has signed a decree allowing the country to unilaterally retaliate in commercial disputes if the hearings are paralyzed in the World Trade Organization (WTO), the official newspaper published.
The Brazilian government said the move was because the WTO’s Appeals Body had ceased to function because the United States had blocked new appointments, meaning there are no arbitrators to resolve cases and appeals are left in a legal vacuum.
Countries that have lost trade disputes with Brazil have been “indefinitely exempt from consequences simply because their appeals will not be considered,” the government said.
According to a statement issued by Bolsonaro’s office, the decree will enable Brazil to implement the favorable decisions it has reached in the WTO, but which have not yet been implemented due to issues related to the appellate body.
A source from the Ministry of Economy said the move paves the way for the country to take unilateral retaliation against India and Indonesia in trade disputes related to sugar and poultry respectively.
Brazil has joined a provisional appeal system with other members, including the European Union and China, but countries such as India, Indonesia and the United States have not joined, blocking any agreement. In December, a WTO panel in favor of Brazil, Australia and Guatemala ruled in their 2019 trade disputes with India over sugar subsidies, and called on New Delhi to comply with global rules, but the Asian country later claimed that I will appeal against the decision.
Brazil also waited for Indonesia to accept recommendations made by a panel following a dispute over the chicken market. Brazil had already requested WTO consultations with Indonesia in 2014 on the measures blocking its access to that market.
The South American country won the dispute, but Indonesia called for “a reasonable period” to adopt its recommendations and in December 2020 appealed to the WTO’s appeal body.
“For now, these are the only two countries against which we have won trade disputes, but ultimately went to the appeals body,” the source said.
The provisional measure allows the suspension to be carried out in two situations. (with information from Valor / Brazil)
Reference-www.eleconomista.com.mx