Introduction to the need for reform
In the context of accelerated globalization and expansion of international trade, Brazil faces the constant challenge of adapting its customs legislation to global best practices, such as the pillars of the SAFE Framework, Green Customs practices, or even the ethical regulation of the use of AI in customs. Bill No. 508 of 2024, proposed by Senator Renan Calheiros (MDB/AL), appears as a strategic response to this demand. This project seeks not only to consolidate the rules that regulate import and export taxes, but promises to profoundly reformulate operational efficiency and legal certainty in the country's business environment.
Code versus customs regulation
From a legal point of view, the difference between the customs code and customs regulations lies in the legal hierarchy and the specific function of each within a country's regulatory system. The customs code is a comprehensive and formal legislative compilation, established by a law of the national legislature, which sets out the legal bases and fundamental principles governing foreign trade operations. This code serves as the main law, defining customs obligations, rights and procedures, as well as establishing penalties for violations. In contrast, customs regulations are detailed administrative rules created by executive authorities or regulatory agencies, with the purpose of implementing and specifying the mandates established by the code. Regulations derive from the authority conferred by the code and cannot contravene its provisions, but they detail the practice and procedures necessary for the effective application of customs laws, ensuring the uniform and pragmatic application of the code in specific situations. Therefore, while the customs code establishes the fundamental legal framework, customs regulations adjust this framework to the practical and operational needs of foreign trade (or at least, that is how it should be).
Experiences in Latin America
Other Latin American countries, such as Chile and Mexico, have already implemented consolidated customs codes, achieving significant results in terms of operational efficiency and legal certainty. Chile, for example, reformed its customs code in 2014, resulting in a considerable reduction in customs processing times and an increase in transparency, strengthening international trade confidence in the Chilean customs system. Mexico followed a similar path, implementing customs reforms in 2015 that simplified procedures, improved enforcement and increased efficiency in tax revenue collection.
Processing and importance of PL 508/2024
PL 508/2024 was submitted to the Federal Senate on February 29, 2024. Its process begins in the Economic Affairs Committee (CAE), where it is analyzed whether the project complies with the principles of preserving the original content of the regulations to be consolidated, in accordance with article 213-B of the Internal Regulations of the Senate. During this phase, a 30-day period is opened for entities and individuals to send drafting suggestions. It is important to note that these suggestions may address the drafting, but do not alter the merit of the original matter, nor do they incorporate or eliminate regulations not included in the proposed consolidation.
Following the initial analysis by the CAE, the project is redirected to the Committee on Foreign Relations and National Defense (CRE), where the text's compliance with international legislation is carefully evaluated. The CRE also promotes a new period to receive external suggestions, enriching the debate and improving the legislative text.
Legal clarity and access to information
For foreign trade operators, clarity of customs rules is essential. Currently, we face numerous challenges due to the dispersion and complexity of the current legislation. Consolidating these standards into a single code would bring significant benefits, such as reducing the time and costs of customs clearance and increasing the efficiency of the entire system.
Operational efficiency and competitiveness
The operational efficiency that a consolidated customs code can provide is critical to improving Brazil’s international competitiveness. Streamlining processes would reduce delays and facilitate the flow of goods across borders, a factor that international partners often highlight as essential when choosing countries for investment and trade partnerships.
Legal security and business environment
Investors and businesses value a stable and predictable business environment. A clear and consolidated customs code increases legal certainty, allowing companies to plan their activities with confidence, free from the risks associated with divergent legal interpretations or outdated legislation.
Fight against tax evasion and illegal practices
Regulatory consolidation would also strengthen the authorities’ capacity to combat tax evasion and other illicit practices such as smuggling. A clear code allows for more effective and uniform oversight, protecting national resources from abuse and fraud. Based on the examples of Chile and Mexico, standardization and clarity in customs legislation have proven to be valuable tools for improving control and reducing corruption – vital components for ensuring sound and fair tax administration.
A call to action and reflection
As a professional with more than twenty-five years of experience in economics and customs clearance, I understand that the approval of PL 508/2024 is crucial for the future of Brazilian foreign trade. This project aligns Brazil with exemplary international practices, promoting a fairer and more efficient business environment.
The way forward and the challenges
As PL 508/2024 moves forward, it is imperative that there is a continued and constructive dialogue between all stakeholders. The successful implementation of this project will depend not only on legislative approval, but also on Brazil's ability to effectively adapt and implement the new rules.
Effective implementation
Implementing a consolidated customs code will require a robust infrastructure and significant investment in training for those involved. Comprehensive training and regular upgrades will be needed for the IT systems supporting customs operations, ensuring that the transition to the new system is smooth and that the benefits can be fully exploited.
Adapting to global dynamics
In addition, Brazil must keep the customs code revised and adaptable to the dynamics of global trade that continue to evolve rapidly. This dynamic process will ensure that the country remains competitive and able to respond effectively to new challenges and opportunities in international trade.
Participation of civil society
The active participation of civil society will be essential to monitor the implementation and effectiveness of the consolidated customs code. Non-governmental organisations and trade associations should play an active role in overseeing the new system, ensuring that it operates in a fair and transparent manner and contributing to more efficient and ethical foreign trade.
Promising future
With careful and considered execution, PL 508/2024 could catapult Brazil into leadership in customs governance in Latin America and serve as a model for other developing countries. Creating a more efficient and transparent trading environment will not only boost the domestic economy, but also significantly improve Brazil’s position on the international stage.
Conclusion
This is a decisive moment for Brazil. The consolidation of customs legislation through PL 508/2024 has the potential to offer a unique opportunity to profoundly reform the national customs system, bringing it more in line with the contemporary requirements of global trade. It is essential that all sectors of society get involved and support this vital reform, ensuring a promising future for Brazil in international trade.
Customs Broker, with a degree in Economics and a Master in Business Administration in Business Management from Fundação Getulio Vargas (FGV). Co-founder of EBIMEX Comércio Exterior and Director of the Union of Customs Brokers of São Paulo (SINDASP), Brazil. He works as an Advisor on Marketing and Institutional Communication at the International Association of Professional Customs Agents (ASAPRA) and is a member of the Brazilian Chamber of Pharmaceutical Products (CBFARMA) of the CNC. He holds certifications in Artificial Intelligence from the OAS (Organization of American States) and in Marketing and Communication from the International Business Management Institute (IBMI), Germany.
