Lula government threatens to use Reciprocity Law against EU veto on Brazilian meat

The government of President Luiz Inácio Lula da Silva (PT) states that it will be able to resort to the resources of the Reciprocity Law to react to the European Union's veto on the purchase of Brazilian meat, which began this Thursday (3).

In a note rejecting the restrictions, the government states that it maintains continuous contact with the European Union and the productive sectors involved to continue trade flows.

The measure affects, in addition to beef and chicken, fish and honey, and could generate a loss of almost US$2 billion per year to Brazilian exports.

"During the repeated actions and meetings held during the period, Brazilian authorities expressed their indignation at the lack of dialogue prior to the adoption of the measure – which does not match the depth of the strategic partnership between Brazil and the European Union", says an excerpt from the document.

The text is signed by the Ministries of Foreign Affairs and Agriculture and Livestock.

"In this context, Brazil implemented the necessary measures to meet the applicable requirements and presented to the European authorities the relevant documentation and information relating to products intended for export, with particular attention to the poultry meat, fish, beef, eggs and honey chains."

Still in the note, Brazil says it agrees with the requested audit in the poultry meat and honey chains, although other European Union trading partners have not been subjected to this type of procedure.

The aforementioned audit began on August 24th and is scheduled to be completed on September 4th.

During the mission, Brazilian technical teams presented the procedures and controls adopted in the country, allowing European authorities to verify, in the field, the structure and functioning of the Brazilian system.

"The Brazilian government has the firm expectation that the ongoing technical dialogue will allow us to reach a quick, objective, transparent solution based on scientific criteria, which adequately recognizes the guarantees offered by the country and remains immune to pressures of a protectionist nature", he says.

The products affected by the new restrictions were subject to quotas and tariff reductions under the agreement between Mercosur and the European Union.

According to Brazilian ministries, the exclusion of these products from the European market nullifies an important part of the gains obtained by Brazil in the negotiations and could, if not promptly reversed, change the balance of concessions that allowed the conclusion of the agreement.

"If negotiations do not lead to a satisfactory solution in a timely manner, the Brazilian government reserves the right to resort to appropriate instruments to ensure balanced trade conditions, including reciprocity measures provided for in the national legal system", stated the government.