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Brazil has formally launched a dispute against the United States at the World Trade Organization (WTO), challenging tariffs imposed by President Donald Trump’s administration and arguing that the measures violate global trade rules.
Brazil’s Foreign Relations Ministry said on Tuesday, it had requested consultations with the US under the WTO’s dispute settlement system, the first formal step in a trade dispute that could eventually lead to a WTO panel if the two countries fail to reach a negotiated settlement.
The complaint targets a 25 per cent tariff imposed by the United States on imports of certain Brazilian goods over alleged unfair trade practices. It also challenges additional tariffs of up to 12.5 per cent applied to imports from dozens of countries, including Brazil, linked to Washington’s claims that trading partners have failed to adequately enforce bans on goods produced with forced labour.
Brazil said the US measures were “unjustified and inconsistent” with Washington’s obligations under the WTO’s General Agreement on Tariffs and Trade (GATT) 1994 as well as the Understanding on Rules and Procedures Governing the Settlement of Disputes.
“The measures adopted by the United States are incompatible with the commitments it assumed under the multilateral trading system,” the ministry said in a statement.
The administration of President Luiz Inacio Lula da Silva had previously indicated it would take the dispute to the WTO after the latest round of US tariff actions.
First step in WTO dispute
Under WTO rules, consultations are a mandatory first stage in resolving trade disputes. The two sides typically have 60 days to negotiate a settlement before the complainant can request the establishment of a dispute panel.
If a panel is formed and rules in favour of Brazil, the United States would be expected to bring its measures into compliance with WTO rules or face the possibility of authorised retaliatory trade measures.
The dispute comes at a time when the WTO’s dispute settlement system remains under strain, with its Appellate Body effectively paralysed due to the US blocking appointments of new judges. While panels continue to hear cases, appeals cannot be fully resolved under the existing system.
Latest chapter in trade tensions
The latest challenge marks another escalation in trade tensions between the two countries, which have increasingly disagreed over tariffs and broader trade policy.
Brazil had mounted a similar WTO challenge last year after an earlier round of Trump administration tariffs. Those duties were later struck down by the US Supreme Court, reducing the immediate impact of the dispute.
The renewed legal action underscores Brazil’s preference for pursuing multilateral legal remedies rather than imposing retaliatory tariffs, even as countries around the world continue to grapple with Washington’s expanding use of trade restrictions.
The Trump administration has defended the tariffs as necessary to address unfair trade practices and strengthen enforcement against imports allegedly linked to forced labour, arguing that the measures are aimed at protecting American industries and ensuring compliance with US trade laws.
Brazil, however, maintains that the tariffs lack legal justification under international trade rules and unfairly restrict access for Brazilian exports to the US market. The outcome of the consultations could shape not only bilateral trade relations but also broader debates over the use of unilateral tariffs within the global trading system.
With inputs from agencies.
