Brazil Notifies the US It Is Opening a Trade Reciprocity Process

Brazil's government has formally notified the United States that it is starting the process under the Economic Reciprocity Law, requesting diplomatic consultations through the Ministry of Foreign Affairs. The move is the first formal step in a legal procedure that could eventually lead to trade countermeasures against US goods, but it does not impose any immediate retaliation.

The trigger is the set of US tariffs placed on Brazilian products this year: a country-specific rate of 25% and an additional 12.5% rate that also applies to other nations. The two rates stack for affected goods, although there are exceptions for certain products in Brazil's export basket. The reciprocity law was sanctioned on April 11, 2025, after an earlier Trump tariff on Brazil of 10%, and its regulation was published on July 15, 2025.

The law gives Brazil's executive branch authority to respond to unilateral trade measures without seeking new congressional approval for each case. It was approved unanimously in the Senate and sanctioned without vetoes. Under the rules, any countermeasure must be proportional to the estimated economic harm and must undergo technical analysis before being adopted.

The process is deliberately multilayered. It runs through an interministerial committee linked to the Ministry of Development, Industry, Trade and Services, then through the Executive Management Committee of Camex, and ultimately to the Strategic Council of Camex, chaired by the vice president. The first technical report is due within 30 days, extendable by another 30, and the government can suspend the process if negotiations with Washington progress.

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How Brazil's Reciprocity Law Works and What It Means for Trade

The Lula Government's Leverage Play

The notification signals Brazil's willingness to retaliate while keeping the door open for a negotiated outcome. Because the reciprocity law gives the executive branch authority to act without a new vote in Congress for each case, the Lula administration controls the timing, scope and pace of any response. That flexibility turns the legal process itself into a bargaining instrument: Washington knows that a technical path toward countermeasures now exists, but Brazil has not yet committed to using it.

Why the Two US Tariffs Shape the Scope of Any Response

Brazil is responding to a country-specific 25% tariff and a broader 12.5% tariff, which can stack depending on the product. Under the reciprocity law, any Brazilian countermeasure must be proportional to the estimated harm. This means the eventual scope of retaliation — if it occurs — will depend on the technical economic analysis of how those two US measures affect Brazilian exports, including product exceptions. The sectors most affected are not yet named in the government's announcement, but they will determine which US goods become plausible targets.

Where the Legal Process Bends Toward Negotiation

Nothing in the reciprocity mechanism is automatic. The first decision is whether the US measure fits at least one of the legal conditions set out in the law. After that, a working group drafts proposals with no fixed deadline, interested parties and trading partners may comment for up to 30 days, and the final government decision can take up to 60 days after the recommendation — with the clock suspended according to the state of negotiations. The Ministry of Foreign Affairs must notify the affected country at each stage, and the declared objective is to mitigate or eliminate both the foreign measures and the Brazilian countermeasures.

What Brazilian and US Businesses Should Watch as the Process Begins

  • Brazil-based exporters to the US: quantify exposure to the two current US tariffs — the 25% country-specific rate and the additional 12.5% rate — and verify whether your products fall under any listed exception before the Brazilian technical report is completed.
  • Companies selling US-origin goods in Brazil: identify product lines that could become countermeasure targets under the law's proportionality requirement, because any preliminary Brazilian proposal must be opened to interested parties for up to 30 days.
  • Use the formal consultation window: once a working group presents a draft, affected companies and trading partners have up to 30 days to submit views — the clearest early opportunity to influence the scope of any retaliation.
  • Follow the sequence rather than expecting immediate action: SE-Camex has 30 days, extendable by another 30, to decide whether the US measures fit the law; only after that can a working group draft measures, with a final government decision of up to 60 days that can be suspended during negotiations.
  • Treat the notification as a diplomatic signal, not a tariff decision: the process explicitly includes consultations between Brazil and the US, and the government's stated objective is to reduce the impact of both US measures and Brazilian countermeasures.

Risk & Opportunity Assessment

Commercial RiskHighBrazilian exporters to the US already face two stacking US tariffs — a 25% country-specific rate and a 12.5% rate, with product exceptions — and the reciprocity process could add further trade friction or countermeasures that disrupt commercial flows.
Competitive RiskMediumThe country-specific 25% tariff puts Brazilian products at a cost disadvantage in the US market relative to suppliers facing only the broader 12.5% measure, while potential Brazilian countermeasures could shift competition among US goods sold in Brazil.
Regulatory RiskHighThe process triggers a sequence of Brazilian trade-law procedures — SE-Camex analysis, Gecex deliberations and a final Camex decision — alongside existing US trade actions, creating legal uncertainty for bilateral commerce.
Reputation RiskMediumOpening a reciprocity process against the US signals a tougher Brazilian trade stance and could strain bilateral relations, even though the government has framed the step as a request for consultations.
Technology DisruptionLowThe dispute concerns tariffs and trade remedies rather than technology competition; the reciprocity law focuses on commercial measures and does not name technology-specific mechanisms.
Commercial OpportunityMediumBrazilian domestic producers that compete with US imports could benefit if countermeasures are approved, and the law allows affected sectors to participate in the preliminary proposal phase.