Brazil challenges legitimacy of Washington investigation

BRASILIA/SAO PAULO — Brazil submitted its formal response to a US trade investigation on Monday, rejecting the allegations while challenging the legitimacy of the probe itself.

While calling for "constructive dialogue", the Brazilian government stated that it does not recognize Washington's authority to launch the unilateral investigation.

The probe, initiated in July under Section 301 of the Trade Act of 1974, aims to determine whether Brazil's policies on digital trade and tariffs are "unreasonable or discriminatory and burden or restrict" US commerce, according to US Trade Representative Jamieson Greer.

This action adds to growing friction between the two countries, including 50 percent tariffs imposed by the administration of US President Donald Trump on imports of Brazilian goods and US sanctions targeting a Brazilian Supreme Court justice.

In its 91-page response, Brazil refuted US arguments concerning its trade practices, including its ethanol market and the popular digital payment system, Pix. The government argued that Brazil's acts, policies and practices are not unreasonable, discriminatory or burdensome to US commerce.

Brasilia also objected to the investigation taking place outside the legal framework of the World Trade Organization. The government has already requested consultations at the WTO over the US tariffs.

The office of the USTR did not immediately respond to a request for comment.

"Brazil reiterates its long-standing position that Section 301 is a unilateral instrument inconsistent with the principles and rules of the multilateral trading system," Latin America's largest economy said.

In another development, Brazil's Supreme Court ruled on Monday that foreign legislation did not have jurisdiction in its country, after the United States used a law to sanction a judge on the court.

Washington used the Magnitsky Act to impose restrictions on Supreme Court Justice Alexandre de Moraes, who is presiding over the trial of former president Jair Bolsonaro.

"Judge Flavio Dino, of the Federal Supreme Court, suspended the effectiveness of judicial decisions, laws, decrees, and executive orders of foreign nations in our country," Brazil's high court said in a statement.

According to the Constitution of Brazil, foreign court decisions "can only be enforced in Brazil upon approval or in compliance with international judicial cooperation mechanisms," the court said.

"No foreign court can invalidate United States sanctions, or spare anyone from the steep consequences of violating them," the US government's Bureau of Western Hemisphere Affairs said in a statement after the ruling.

Agencies via Xinhua