Brazil Import Licensing/Customs Valuation

All importers must register with the Secretariat of Foreign Trade (SECEX) to access Brazil's
"SISCOMEX" trade documentation system. SISCOMEX registration requirements are
onerous, including a minimum capital requirement; however, the new updated SISCOMEX system, installed in early 2007, has cut the wait time for import-export license processing almost in half. In addition, fees are assessed for each import statement submitted through SISCOMEX. Most imports into Brazil are covered by an "automatic import license" regime. Brazil's nonautomatic import licensing system covers imports of products that require authorization from specific ministries or agencies, such as beverages (Ministry of Agriculture), pharmaceuticals (Ministry of Health), and arms and munitions
(National Defense Ministry). Although a list of products subject to nonautomatic import licensing
procedures is published on the Brazilian Ministry of Development, Industry and Trade website,
(http://www.desenvolvimento.gov.br/arquivo/secex/conPorImportacao/AnuentesLInaoAuto.pdf), specific information related to nonautomatic import license requirements and explanations for rejections of nonautomatic import license applications are lacking. These measures have made importing into Brazil less transparent and more cumbersome for U.S. exporters.
U.S. companies continue to complain of onerous and burdensome documentation requirements, which are required before certain types of goods can enter Brazil - even on a temporary basis. For example, the Ministry of Health's regulatory agency, ANVISA, must approve product registrations for imported pharmaceuticals, medical devices, health and fitness equipment, cosmetics, and processed food products.
Currently, the registration process at ANVISA takes about 3 months to 6 months for new versions of existing products, but can take over 6 months to register products new to the market. Registration of pharmaceutical products can take over 1 year, since ANVISA requires that a full battery of clinical testing be performed in Brazil, regardless of whether or not the drug already has FDA approval.
ANVISA implemented a regulation late in 2007 (Regulation 185) to comply with federal legislation (Law 10742 of 2003). This regulation requires companies to submit economic information (some of it proprietary) including projected worldwide pricing intentions, in order to register medical devices.
Attempts by industry representatives to challenge this new requirement have been unsuccessful thus far, and no new devices have been registered since it was established. Implementation of such import measures not only delays entry of state-of-the-art U.S. pharmaceutical and medical products into the Brazilian market; it also renders it impossible for U.S. companies to demonstrate new-to-market goods at industry trade shows.

The United States has raised a concern with Brazil that the state of Rio de Janeiro administers the ICMS tax (a value added tax collected by individual states) in a way that provides a preferential tax advantage to a Brazilian soda ash supplier located within the state.

STANDARDS, TESTING, LABELING, AND CERTIFICATION

GOVERNMENT PROCUREMENT
Law 8666 of 1993, which covers most government procurement other than informatics and
telecommunications, requires nondiscriminatory treatment of all bidders regardless of the origin of the product or service. However, the Law’s implementing regulations allow consideration of nonprice factors, giving preferences to certain goods produced in Brazil and stipulating local content requirements for eligibility for fiscal benefits. Decree 1070 of 1994, which regulates the procurement of information technology goods and services, requires federal agencies and parastatal entities to give preferences to locally produced computer products based on a complicated and nontransparent price/technology matrix.
However, Brazil permits foreign companies that have established legal entities in Brazil to compete for procurement-related multilateral development bank loans and opens selected procurements to international tenders.
Brazil is not a signatory to the WTO Agreement on Government Procurement.

INTELLECTUAL PROPERTY RIGHTS (IPR) PROTECTION
Brazil has made important progress in enhancing the effectiveness of intellectual property enforcement, particularly with respect to pirated audio-visual goods. Nonetheless, shortcomings in some areas of IPR protection and enforcement continue to represent barriers to U.S. exports and investment.

Patents and Trademarks
The United States has raised concerns regarding Brazil’s Law 10196 of 2001, which includes a
requirement that National Health Surveillance Agency (ANVISA) approval be obtained prior to the issuance of a pharmaceutical patent. The implementation of this requirement is nontransparent and has contributed to an ongoing backlog in the issuance of patents. The United States is also concerned that this requirement singles out one particular product category for a set of procedural requirements, raising questions in connection with Article 27 of the WTO Agreement on Trade Related Intellectual Property Rights (TRIPS Agreement).

On May 4, 2007 Brazil issued a compulsory license for Merck Sharp & Dohme's anti-retroviral drug efavirenz (brand name: Stocrin) used in treating HIV/AIDS patients. The United States has urged Brazil, in advancing its national public health objectives, to engage in transparent and open discussions with patent holders and other stakeholders, in order to achieve good public health outcomes while preserving the incentive to innovate by protecting intellectual property.

Although Brazil's patent backlog remains high, estimated at between 130,000 and 150,000 applications, the national patent office has taken concrete steps to streamline processing, including an upgrade of its outdated computer system. Over the past 2 years it has increased the number of patent examiners over 200 percent and has plans to further increase the number of examiners from the current level of 255 to 360 full time examiners by the end of 2008, at the same time increasing median salaries 50 percent to retain experienced employees. By the end of 2008, INPI expects to increase its patent processing capacity from the current 20,000 applications per year to 30,000 per year. The government estimates that by the
end of 2009, new patent applications will be adjudicated within 4 years, which would represent the end of the backlog. Brazil has also raised trademark approvals almost six-fold since 2003. In mid-2006, the National Institute of Industrial Property (INPI) instituted a new system of streamlined, paperless processing for trademarks. According to INPI, as a result of the new system, new trademark applications are now being initially processed within a maximum time frame of 12 months. The U.S. Patent and Trademark Office is working with INPI to help that agency in its modernization efforts.
The United States is also concerned about Brazil’s protection against unfair commercial use of data generated in connection with obtaining marketing approval for pharmaceutical products. Law 10603 of 2002 on data confidentiality covers pharmaceuticals for veterinary use, fertilizers, agro-toxins, and their components and related products. The law does not cover pharmaceuticals for human use. If a human use pharmaceutical product is not commercialized within 2 years of the date of sanitary registration, third parties may request use of the data for registration purposes.

Copyrights

Brazil is not a party to the World Intellectual Property Organization Treaties on Copyright, and
Performances and Phonograms.
Despite recent enforcement gains, piracy remains a serious problem. The International Intellectual Property Alliance (IIPA) estimates losses due to piracy of copyrighted materials in Brazil totaled at least $849.6 million in 2007.


Express Delivery Services

Brazil’s customs service is in the process of switching to an automated express delivery clearance system,which will significantly reduce customs clearance times for express packages once it is implemented.
Customs originally expected to complete implementation of the system by the end of 2007; however, a revised schedule now calls for completion in the first quarter of 2008. After implementation of this system is complete, customs has plans to redraft express delivery regulations to remove some of the current restrictions on express delivery.
The U.S. Government is engaging the Brazilian government on use of Admission Temporaire-Temporary Admission (ATA) Carnets. The ATA Carnet, an internationally accepted customs document, would ease the temporary importation of commercial samples, professional equipment, and goods for exhibitions and fairs.