What could Brazil’s “internet bill of rights” mean for U.S.-Brazil relations?

Last week, the Brazilian Chamber of Deputies passed its groundbreaking Internet Framework bill—the so-called "internet bill of rights." And though the bill has yet to pass in the country's Senate, it is expected to be voted into law without any significant alterations.
 
The bill has been in the works for a few years, but it took on greater significance after the U.S. internet surveillance leaks that surfaced this past summer through former National Security Administration (NSA) contractor Edward Snowden. The revelations of U.S. intelligence gathering activities prompted the inclusion of a provision for local data storage in the bill—and put substantial strain on the U.S.-Brazil bilateral relationship.
 
In this context, this week marks the start of the new Brazil Initiative here at CSIS—a program that, in coordination with Apex-Brazil, seeks to shed light on the many facets of the U.S.-Brazil relationship, bringing issues relevant to both countries to the forefront here in Washington, D.C. in an effort to create a more robust conception of bilateral relations. Largely an outgrowth of the past year's tensions, the Initiative will highlight key areas of mutual benefit for the United States and Brazil, with a particular focus on the commercial opportunities at stake.
 
Ultimately, whatever their recent troubles, the two countries are too important to one another for the bilateral relationship to stagnate. So where does the relationship stand, and why does it matter?
 
Q1: What is the status of the U.S.-Brazil bilateral relationship, and what could the "internet bill of rights" mean for the two countries moving forward?
 
A1: In the wake of the NSA leaks and facing mounting domestic pressure, Brazilian president Dilma Rousseff postponed her state visit to the United States and publically condemned the NSA's operations before the United Nations General Assembly—even drafting a UN resolution in partnership with Germany to denounce mass surveillance on the international stage. And many saw the Brazilian government's decision to award a years-pending multi-billion dollar contract for fighter jets to Swedish manufacturer Saab over U.S.-based Boeing as further retaliation for the NSA's activities.
 
But it seems that the domestic pressure in Brazil that has contributed to the strain on the bilateral relationship may be easing. Without a majority in the Chamber of Deputies, President Rousseff has relied on a coalition between her own political party, the Partido dos Trabalhadores (Workers' Party, PT) and the Partido de Movimento Democrático Brasileiro (Brazilian Democratic Movement Party, PMDB) to advance her legislative agenda. And despite its support for the Internet Framework bill as a whole, the PMDB refused to allow its passage with the local data storage provision.
 
Public opinion, then, no longer precludes Brazilian policymakers from opposing more drastic moves—like the data storage provision. And this shift may indicate that the landscape of U.S.-Brazil relations is shifting in kind.
 
The PMDB's position on the Internet Framework bill is hardly the first sign that Brazil may be ready to mend fences. Despite the government's vocal indignation early on, it stopped short of granting Snowden asylum—preempting his application, even after he offered to assist Brazil in its efforts to beef up cyber security. And in the lead-up to the World Cup, the two have even cooperated on security matters, with the FBI and local Brazilian police working together to prepare for the massive sporting event.
 
Continued interaction between Rousseff and President Obama, the announcement of the reciprocal liberalization of certain agricultural trade, the U.S. government’s willingness to play a key role in Brazil’s Global Multi-stakeholder Meeting on the Future of Internet Governance, and U.S. support for the Brazilian-led United Nations resolution on privacy in the digital era may indicate that however difficult the past months have been for the bilateral relationship, all is not lost. It remains to be seen to what extent the past year's developments—and a closer-than-ever Sino-Brazilian relationship—will impact U.S.-Brazil ties moving forward—and how these factors will define Brazil's role in global politics.
 
Q2: Where could the bilateral relationship go from here?
 
A2: In the coming years, U.S.-Brazil relations will likely be largely characterized by a deepening of the countries' commercial ties and an easing of the past year's tensions.
 
One potential avenue for the two would be the finalization of a long-discussed bilateral tax treaty. Given the complex regulations on the Brazil market, such a treaty would open broad avenues for investment and market access on both sides. And a successful treaty could even serve as a springboard for a larger framework of economic cooperation in the form of bilateral free trade or investment treaties—both of which would serve as boons to the U.S.-Brazil relationship.
 
The two are the largest economies in the Western Hemisphere. Bilateral trade, investment and economic ties have only grown in recent years, and both have far-reaching trade agreements with their neighbors to ensure the movement of goods across borders. It seems, then, that a tax treaty—or, along the same lines, trade facilitation or the harmonization of regulations and standards—could provide the impetus needed to bring U.S.-Brazil commercial relations to the next level.
 
On the political front, relations remain sensitive at best. Despite the progress made in repairing ties since the NSA leaks and their ensuing fallout, the political side of the relationship is still raw—and trust still needs to be rebuilt.
 
But the political will to rebuild that trust may not, at least in the short term, prove easy to come by.
 
The U.S. government, already mired in partisan divide at home, has little patience for non-urgent international politicking. And in its global relations, the United States has focused on points of crisis: the chemical weapons crisis in Syria, the political crisis in Venezuela, and, of course, and the geopolitical crisis in the Ukraine.
 
And little more can realistically be expected of Brazil. With President Rousseff preparing for her reelection campaign later this year and still facing significant and vocal popular dissatisfaction at home, she will likely maintain a firm focus on domestic politics—and on preparing for this summer's World Cup.
 
In other words, there is unlikely to be major movement in furthering the relationship in the short run. With both governments well occupied elsewhere, their bilateral ties are unlikely to number among the top priorities—even with all there is to gain from closer and more robust relations.
 
Q3: Why, then, does the bilateral relationship matter?
 
A3: In some ways, the importance of the U.S.-Brazil relationship can hardly be overstated. While the United States remains the largest economy in the region, Brazil has, in recent years, risen to second place. The two are the most populous countries in the Americas, together comprising more than half of the region's total population. And in their ethnic diversity and democratic political ethos, the two undeniably have much in common.
 
Yet there remains little in the way of formalized bilateral cooperation—and what is in place falls far short of a comprehensive framework for their collaboration moving forward. In simplest terms, the two countries have struggled to develop a framework despite the immense gains to be had on both sides.
 
Still, the relationship is important, ultimately, because of what it can be—but not, at the moment, because of what it is.
 
Brazil is seeking a larger role in global issues, and the United States is seeking reliable partners abroad. With all the two have in common, it seems, then, that they might make ideal partners—could they identify an issue relevant to both nations' interests as a forum for collaboration. It is that sort of collaboration—a truly mutually beneficial partnership—that could bring order to this chaotic and discombobulated relationship.
 
Similarly, if the two are able to untangle the commercial relationship by means of a clear regulatory framework, to work together on global concerns ranging from respect for human rights in the region to global climate change, to develop a close partnership between the two most powerful countries in the region—both clearly could emerge better off. While they two may not always agree—and, in fact, they often may not—there is, without a doubt, more to be gained through a collaborative partnership than through the uncoordinated fumbling that has characterized the countries' relations to date.
 
Conclusion: Brazil and the United States have so much in common, but the past year has delivered immeasurable strain to an otherwise promising relationship. And with domestic and international politics as they are, political will to repair those ties is low, at best.
 
But perhaps the same cannot be said for the countries' commercial relations. Given the vast opportunities for bilateral commercial synergy, the development of robust bilateral trade and investment could be the key to opening a new chapter in the U.S.-Brazil relationship—a chapter that, we can only hope, would spill over into politics as well.

Carl Meacham is director of the Americas Program at the Center for Strategic and International Studies (CSIS) in Washington, D.C. Carlos Grover, intern scholar, and Jillian Rafferty, program coordinator, both with the CSIS Americas Program, provided research assistance.

Critical Questions is produced by the Center for Strategic and International Studies (CSIS), a private, tax-exempt institution focusing on international public policy issues. Its research is nonpartisan and nonproprietary. CSIS does not take specific policy positions. Accordingly, all views, positions, and conclusions expressed in this publication should be understood to be solely those of the author(s).

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