Brazil’s Path to Digital Ex Ante Competition Regulation: Remarks on the Brazilian Ministry of Finance Proposal 2024

Two initiatives have put this debate at the forefront of the national policy agenda: This debate has been brought to the forefront of national policy by two initiatives:

The push towards ex ante regulation is partly due to the recognition that digital markets have unique features that make traditional, reactive enforcement of competition difficult. These features include rapid scaling, data accumulation, substantial switching costs and economies of scale, as well as expanding digital ecosystems. They raise significant economic and policy concerns beyond traditional competition issues, as they affect the broader distribution of economic value in digital markets, potentially entrenching an environment where digital dividends remain concentrated among a few dominant platforms.

Brazil’s competition authority, the Administrative Council for Economic Defense (CADE, in Portuguese acronym), has nearly three decades of experience enforcing competition law in digital markets, having reviewed mergers and investigated anticompetitive conduct in these sectors since at least 1995. CADE’s experience has given it insights into the limitations ex post enforcement. This is why they are now supporting a complementary ex-ante regulation. CADE noted that in its submission for the public consultation of the Ministry of Finance in 2024 it acknowledged that digital market dynamics posed systemic competition risks which exceeded the capability of traditional enforcement. We first examine Bill No. We first examine Bill No. The BMF Proposal is then examined, with a focus on its key features. We also analyse the feedback that was received during the consultation process and discuss possible next steps for digital platforms regulation in Brazil. 2,768/2022

Bill No. On 10 November 2022, Congressman Joao maia introduced Bill No. 2,768/2022 in the Chamber of Deputies. It is often referred to by the name “Brazilian DMA” because it mirrors concepts from the EU Digital Markets Act. The Bill targets digital service companies that serve the Brazilian population. The bill sets a revenue threshold, assuming that a platform is ‘essential’ if its annual revenue in Brazil is at least BRL70 million (approximately US $11.5 million). However, this low threshold attracted significant criticism for potentially encompassing a broad range of platforms beyond the intended targets.

Additionally, rather than modifying existing competition law, the Bill proposes integrating the ex ante digital platform regime within Brazil’s telecommunications and internet legislation, designating the Brazil’s National Telecommunications Agency (ANATEL) as the primary regulator. ANATEL will be responsible for implementing the new regime, enforcing it, and mediating any disputes. This decision was criticised

, given that digital platforms’ businesses differ fundamentally from traditional utilities and telecommunications entities, raising concerns about regulatory misalignment.

The Bill outlines broad principles such as proportionality, non-arbitrariness, and cost-effectiveness, alongside ambitious policy goals (innovation promotion, reducing inequalities, and fostering interoperability). This ambitious scope was criticized for being too expansive and unclear, which could lead to inconsistent or arbitrary implementation. Key regulatory obligations include:

transparency obligations

– platforms would be required to report detailed information on their operations to ANATEL;non-discrimination requirement –

platforms are to offer services fairly and without discrimination, preventing them from favouring their own offerings or unjustly blocking competitors;

• data use and portability – the legislation requires adequate safeguards on platform data use, implicitly limiting the exploitation of user or business data while encouraging interoperability and data portability;
• access for business users – dominant platforms are prohibited from denying service to professional users dependent on their platforms;
• merger oversight – ANATEL would gain authority to review mergers involving designated platforms, even if these fell below traditional CADE thresholds. The bill requires adequate safeguards on platform data use, implicitly limiting the exploitation of user or business data while encouraging interoperability and data portability. The bill has a long way to go in terms of its procedural journey. The Speaker of the House sent it to four committees: Economic Development, Science & Tech/Communication (Finance & Tax), Constitution & Justice, and Finance & Tax. The Economic Development Committee reviewed it first, with Congresswoman Any Ortiz serving as the rapporteur. By the end of 2023 there had been no vote in the committee. In an attempt to gather feedback, the reporteur launched an online consultation on the Bill text and digital market regulation. This drew responses from stakeholders. The bill’s progress stalled. The Brazilian legislature took a wait-and see approach. A broader political shift played a part. The Lula administration took office in 2023 and the Executive branch began formulating their own approach to digital regulations (through the Ministry of Finance), which indicated a possible shift from the Bill. Observers noted the likelihood that it would languish if there was no external push or consensus. The Bill’s prospects are dim as of March 2025. It is still on the docket but its chances are low. The Brazilian Ministry of Finance has launched a public consultation
• to assess whether the Brazilian Competition Law should be amended to include new ex-ante regulations for digital platforms. This was the first direct action by the Executive branch in the debate. It ran parallel to the stalled Bill and independent of it. The Ministry’s background paper highlighted that digital platforms pose distinct competition concerns, requiring new or adapted theories of harm and competition tests to address platform-specific issues. The Ministry’s background paper
• highlighted that digital platforms pose distinct competition concerns, requiring new or adapted theories of harm and competition tests to address platform-specific issues.The Public Consultation was divided into four different topics:

goals and regulatory rationale;

sufficiency and the adequacy of the current model of economic regulation and competition defense;

design of a possible pro-competitive economic regulatory model; and

• institutional structure for regulation and supervision.
• The consultation received 72 contributions from a wide range of stakeholders, including businesses, digital platforms, think tanks, civil society organisations, and regulatory agencies. The Ministry of Finance released a report outlining a proposed regulatory framework in October 2024 based on the feedback received. These factors create substantial switching costs, making it difficult for users to collectively move away from an incumbent–especially when platforms use strategies such as pre-installation defaults, single sign-on, and exclusive deals to maintain their dominance. The report also highlights the fact that CADE’s current competition tools, like the requirement to demonstrate dominance in a defined marketplace and the lengthy investigation process for abuse of dominance, fail to deliver timely or efficient remedies. The current ex-post competition framework is not able to prevent incumbents from consolidating their dominance on multi-sided digital marketplaces, despite being legally robust. The current ex post competition framework is not suited to address structural or ecosystem-wide concerns, which go beyond specific instances of anticompetitive behavior. Instead of replacing ex-post enforcement, it introduces targeted measures ex-ante tailored to platforms that have’systemic significance’ based upon their market influence and business features. If implemented, this framework would empower Brazil’s competition authority to impose tailored obligations and behavioural constraints on these platforms.

Further, the report outlines how the new regulation could interact with the existing competition framework, what problems they aim to solve, and which design features can be adopted from international experiences and tailored to the Brazil’s market dynamics. The proposed measures are divided into two categories:

–

New ex-ante regime for “systematically relevant” digital platforms

An important element of the new regime is to create a process that will designate digital platforms to be “systemically relevant” to competition (similar to the DMA gatekeepers). The BMF proposal envisages strengthening CADE’s capacity to administer the new regime. The proposal calls for the creation of a digital markets unit at CADE. The unit would be responsible for overseeing the designation process, conducting’stage-two investigations’ to define specific obligations, and monitoring compliance. Its decisions would then be submitted to CADE’s Tribunal (the decision-making commission) for approval, effectively creating an ‘ex ante regulator’ function within the competition authority.

The designation criteria would rely on a combination of qualitative and quantitative thresholds:

Qualitative criteria (to be defined in law) would include factors such as presence in multiple markets with strong network effects, strategic gatekeeping or controlling over essential digital structures for third parties, extensive vertical or diagonal integration across different ecosystems, and control over a volume of data that grants the ability to exclude or penalise potential rivals.

Quantitative criteria would include minimum revenue thresholds (globally and in Brazil) . Platforms below the revenue cutoffs would be exempt from designation, ensuring only major players fall under the new regulatory framework.

Upon designation as systemically relevant, platforms must comply with a set of proactive obligations and procedures, including:

• Merger notification:
• Designated platforms would be required to notify CADE of any planned acquisitions or mergers, irrespective of whether such transactions meet the usual revenue thresholds for mandatory review. This measure addresses the regulatory gap that allows large digital platforms to acquire smaller but significant tech firms without regulatory scrutiny.
• Transparency requirements
• : Designated platforms are obliged to maintain transparency toward end users and business users. This includes notifying them of any changes in terms of service, and providing vital information about the operational aspects of the platform’s services. The goal is to prevent opaque practices that could exploit users or business dependencies.

Tailored obligations after investigation

: The proposed framework introduces a two-step enforcement mechanism. First, CADE will be authorized to investigate whether or not a platform meets the statutory criteria for being designated as “systemically relevant”. CADE can then impose specific obligations to address the competitive vulnerabilities and potential problems raised by the business model of the platform. The guiding principle is, that if a platform is determined to be of systemic importance, then certain conducts – such as using data from business users to gain a competitive advantage in adjacent service – would be presumptively problematic. This methodology is structurally the same as the German Bundeskartellamt’s approach under Section 19.a of the GWB and UK’s Digital Markets, Competition and Consumers Act. The BMF proposal allows designated platforms to provide ‘objective reasons’ for their practices. The platform is now responsible for proving that the practice in question is objectively justified, and does not harm the competition. This inversion of the proof is intended to overcome information asymmetry, which can often hamper competition enforcement. Once a tailor-made set of obligations or prohibitions is in place, a breach would expose the platform to administrative fines of up to 20% of its group turnover in Brazil, in line with the maximum sanction under the Brazilian Competition Law.

Cooperation with sectoral regulators:

Where technical or sector-specific expertise is needed, CADE would coordinate with other regulators like ANATEL or the National Data Protection Authority (ANPD) in designing and enforcing obligations . This cooperative approach acknowledges that digital markets cut across regulatory domains and seeks to avoid conflicts by establishing a formal collaboration mechanism.

Adjustments to the existing competition toolkit

In parallel to the new ex ante track, the Ministry’s report recommends multiple procedural and interpretative reforms to modernise existing competition enforcement, including:

Updated analytical tools:

• Enhancements to CADE’s guidelines and internal analytical methods to better account for network effects, ecosystems, and new theories of harm in digital markets . This includes evaluating how a dominant platform’s interconnected services affect competition and recognising data accumulation as a market power source.Merger review reforms:
• Revisions to CADE’s merger notification form to improve the identification of transactions involving platforms with large user bases, strong network effects, or high data synergy. CADE can also apply the “ordinary procedure” (full in depth review) to mergers that involve large digital platforms even if only basic thresholds are met. This allows a more detailed assessment of potentially complex effects. The proposal also suggests raising the thresholds for merger notifications, and focusing enforcement on transactions that are most relevant to competition concerns. It also calls for a more strategic use of an under-utilised mechanism that allows CADE to demand the filing of non-notifiable transactions that raise competition concerns.Market studies authority:

CADE’s ability to conduct market studies or sector inquiries would be reinforced, granting it powers to demand information and study digital sectors proactively . This can help identify emerging issues or monitor compliance on digital markets without relying only on formal complaints. The goal is to promote competition and innovation while limiting the regulatory impact of dominant platforms on smaller companies and newcomers. As expected, the main opposition came from representatives of major digital platforms and business groups. The Latin American Internet Association, which represents companies like Google, Meta, and Amazon, strongly criticized

• this proposal, arguing it lacked a diagnosis of market failures that would justify ex ante regulations. Camara-e.net is a Brazilian trade group for the digital economy. They also expressed concern about these regulations, saying that they could be based on foreign experiences and anticipate problems that may not have materialised in Brazil. Similarly, international industry groups including the Computer & Communications Industry Association (CCIA) welcomed the BMF’s consultative approach and recognition of CADE’s role, but urged a principles-based, proportionate framework, noting that ex ante regimes in other jurisdictions remain experimental and potentially burdensome.
• In contrast, several civil society organisations and academic commentators welcomed the Ministry’s initiative as a long-overdue effort to curb the market power of dominant digital platforms. Over 100 civil society organizations and academic institutions, in a coalition, had previously called for specific economic regulation to complement antitrust enforcement, and promote transparency and accountability in the digital economy. The Data Privacy Brasil Research Association applauded
• that the Ministry’s proposal was a necessary step in ensuring that competition policy addresses wider public interest concerns such as consumer rights and democratic accountability. Academic observers noted that the final report marked a departure from earlier legislative drafts by centring enforcement within CADE and tailoring obligations to Brazil’s institutional and economic context, a strategy seen as more viable and coherent than simply transposing EU-style regulation.
• Notably, CADE itself expressed support for the proposed expansion of its mandate. In its formal submission, CADE acknowledged that traditional antitrust tools were not sufficient to address the challenges posed by digital platforms. It welcomed the opportunity to apply market-specific, preventive obligations. However, the authority refrained from providing a comprehensive roadmap for structuring the new regime, leaving open questions about how these obligations would be defined, enforced, and monitored in practice.

The path forward involves several steps:

Drafting of legislation:

The Executive branch (Ministry of Finance, possibly in coordination with the Ministry of Justice/CADE) will prepare a draft bill to implement the proposed framework. The Executive branch (Ministry of Finance, possibly in coordination with the Ministry of Justice/CADE) will prepare a draft bill to implement the proposed framework. 12,529/2011). By embedding the ex ante regime into existing competition law, the drafters aim to formally empower CADE with the new designation and enforcement tools, specifying thresholds and potential obligations.

• Introduction to Congress: Once the bill is finalised, the government is expected to introduce it to the National Congress . The bill will be introduced to the National Congress by the government once it is finalised. The new content may also be merged with or replaced by Bill No. Through a legislative process, Bill No. 2,768/2022 can be amended. Regardless of the mechanism, congressional debate will be needed, including committee reports, possible public hearings or expert input, and votes in both the Chamber of Deputies and the Senate.
• Timeline and challenges: The Minister of Finance’s presentation of the government’s 2025 legislative priorities
• explicitly listed the proposal as a means to ‘improve the business environment’ in Brazil–indicating that the government will push for it as part of its broader economic reform package. The legislative calendar does impose constraints. Idealy, the bill would be advanced in 2025 before the political focus shifts to the 2026 elections. Election years are usually a time when lawmaking is slowed down, as it becomes more difficult to pass controversial reforms. The timing of mid-term is therefore critical. If progress stagnates, as it did in the past with the digital regulation bill, chances of enactment could be reduced significantly. The relationship between the current administration and Congress will also play a role. It has already passed controversial measures such as a new fiscal structure and tax reform. Pushing through an ex-ante proposal for digital platform will require no less political effort. Additionally, any effort to rein in big tech is likely to encounter strong resistance from large digital platforms and their affiliates, such as think tanks and other supportive organisations, especially considering the international political climate, which may include potential opposition from the Trump administration.Regulatory implementation:

If the legislation is approved, implementation will become the key challenge. The institutional capacity of CADE is a major concern. It will need enough staff and funding to perform its new functions. The agency must establish the dedicated digital market unit as envisioned in the proposal, develop internal procedures and guidelines for the designation process, design specific obligations and then enforce these new rules. This could involve extensive market studies and additional consultation processes to determine what platforms meet regulatory criteria. Then, formal designations will be made and tailored obligations imposed. The agency will need to coordinate with other sectoral regulators, such as ANATEL and ANPD, to benefit from their technical expertise and to avoid conflicts. The enforcement architecture will need significant preparation, and perhaps a cultural shift away from the traditional ex-post case-by-case enforcement to a proactive regulatory supervision role. Ensuring that the agency has the budget, expert personnel, and legal tools in place will be crucial for the regime’s success–under-resourcing the effort could undermine the effectiveness of the entire regime. The coming months will determine whether this regulatory transformation takes hold. The scope and strength of the new regime will determine whether Brazil’s Competition Authority becomes a proactive digital regulator, or if it remains reactive to digital market challenges.

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