Unpacking Brazil’s Latest Effort to Regulate Digital Markets

On September 17, 2025, the Brazilian federal government submitted the Fair Competition Act for Digital Markets, Bill 4675/2025, to the National Congress, marking Brasília’s latest effort to update its competition framework for the platform economy. The proposal has been presented by its supporters as a more flexible and context-sensitive alternative to the European Union’s Digital Markets Act (EU DMA). Rather than imposing a fixed set of obligations on predefined “gatekeepers,” the bill would empower Brazil’s antitrust authority, the Administrative Council for Economic Defense (CADE), to designate systemically relevant firms and tailor obligations to their specific role in Brazil’s digital markets. This approach has clear advantages: Digital markets evolve quickly, and Brazil reasonably should seek to design rules suited to its own economy rather than simply importing another jurisdiction’s model. But the same flexibility that makes the bill attractive also raises its central challenge. Without clearer guardrails and predictability, CADE’s broad authority could create uncertainty for firms, complicate long-term investment decisions, and make Brazil’s emerging digital regulatory model harder to assess.

Background

The bill’s drafting was part of a larger “Digital Brazil Agenda,” a comprehensive government initiative designed to cultivate a more secure, dynamic and inventive digital environment. Proposed by the Brazilian Ministry of Finance (MOF), Bill 4675/2025 would amend existing competition law to regulate digital markets under the purview of CADE. Embedding these rules into the current legal framework—rather than establishing a stand-alone policy—represents a major shift in approach from an earlier draft in 2022, which faced backlash due to its unclear objectives and inconsistencies with national competition standards.

Inspired by global trends in digital regulation from the EU DMA to India’s Draft Digital Competition Bill, the proposal introduces ex ante mechanisms (meaning those that take effect before the finding of anticompetitive harm) to “promote contestability, preserve competition in adjacent markets, and create incentives for the efficient management of ecosystems” in Brazil’s digital ecosystem. This wave of provisions responds to the perceived rise in “winner-takes-all” dynamics of digital markets, where network effects and data monopolies have enabled a select few platforms to lock in consumers and dictate market access. Outside the European Union, as of April 2026, more than 30 countries, including Brazil, have actively adopted or are considering digital regulation similar to the EU DMA. There is significant variation within this set, however, as Brasília’s legislation departs from the DMA’s prescriptive, blanket list of obligations, opting instead for a flexible dual-stage process as seen in Germany’s Competition Act and the United Kingdom’s Digital Markets, Competition, and Consumers Act.

Breaking Down Bill 4675/2025

The 2025 bill proposal is the result of a two-year study on digital platforms led by the Secretariat of Economic Reforms of the MOF in Brazil. Two major themes emerged from the public consultation: CADE’s broad discretionary power and its “ecosystem” approach to designating firms. Key features of the proposal include the following:

1. Dual-Stage Designation: The bill authorizes CADE to first designate “systemically relevant” platforms in digital markets and then determine which specific duties apply to them. Platforms will be reviewed on a set of quantitative and qualitative factors on a case-by-case basis. This includes a minimum revenue threshold of R$5 billion domestically (roughly $900 million) or R$50 billion globally (roughly $9 billion), alongside other factors such as user base, product offerings, and market power.
2. Designated Duration and Obligations: Once designated, a platform’s status remains active and only expires after 10 years, subject to renewal. CADE holds full discretion to pick and choose individual obligations for each platform from a nonexhaustive list, including mandatory M&A notifications, data portability requirements, self-preferencing prohibitions, disclosure of data collection conditions, pricing structures, and criteria used for ranking search results.
3. Ecosystem Approach: The “systemic relevance” designation applies to the entire economic agent, capturing both the corporate parent and all its subsidiaries (e.g., Alphabet Inc. and its subsidiary Google would be considered as one entity). Unlike the EU DMA, which explicitly regulates individual “core platform services” such as a specific app store or search engine, technology giants would be evaluated based on their entire digital footprint.
4. Higher Penalties: Under the previous 2022 proposal, designated platforms facedfines up to 2 percent of their national revenue. The current bill introduces noncompliance fines ranging from 0.1 percent to 20 percent of the company’s revenue within the designated line of business. Daily penalties also apply for failing to maintain a physical office in Brazil or updated contact information.
5. Digital Markets Superintendent Supervision: A separate unit under CADE, the Digital Markets Superintendent (SMD), will also be created as part of this bill to act as the primary investigative and supervisory body. The SMD’s main roles are to start the designation process, propose obligations, and monitor compliance, but all final adjudication of these designations and subsequent sanctions will be exclusively decided by CADE’s Administrative Tribunal.

As of early 2026, the Brazilian National Congress has received a formal request to expedite the progress of Bill 4675/2025 to the floor for a plenary vote. This motion for urgency effectively bypasses debate stages and multicommittee reviews, allowing for quick ratification and limited deliberation.

What Form Should Digital Regulation Take in the Global South?

CADE’s commissioner, Victor Oliveira Fernandes, has argued that the country’s digital competition bill and experience will serve as a reference model for other countries deciding whether to adopt incremental regulation within traditional antitrust frameworks or a complete overhaul to govern the rise in digital platforms' market presence. Outside Brazil, countries such as India and Thailand have introduced entirely new ex ante regulations, while others, including Indonesia and Mexico, are proposing amendments to existing legislation. It remains to be seen which approach provides sufficient governance, while also limiting the impact of complex compliance and financial obligations for large technology firms.

In a report analyzing the impact of cross-border flows of data, the UN Conference on Trade and Development found that emerging economies act as the primary source of raw data yet lack the ability to generate value from these technological assets. Nations like Brazil are concerned that the economic benefits of data collected from their citizens are primarily distributed to a select few large multinational corporations. Furthermore, large platforms are in a unique position to absorb local economic resources, talent, and innovations.

Proponents of digital market regulation also point out that concentrated data accumulation creates information asymmetries, economies of scale, and network effects that can lead to broad market power. Bill No 4675/2025 has therefore been framed by its supporters as part of a broader effort to empower developing nations to reclaim control over domestic data. Supporters also contend that sovereign control over local data could foster innovation and drive investments in domestic technological capabilities that reduce reliance on global platforms.

Regulatory Uncertainty and Concerns Over CADE’s Expansive Authority

Like other ex-ante approaches to digital regulation, the Brazilian approach has its share of critics, including mostly U.S. firms that would likely be subject to its conditions (potentially including Alphabet, Amazon, Apple, Microsoft, Meta, and Uber). “By singling out a narrow group of large platforms,” the U.S. Chamber of Commerce writes, “the bill would foster a discriminatory regulatory environment, discourage investment, and undermine the very competition it aims to promote.” Further criticisms of the bill include the following:

1. CADE’s broad discretionary powers create an uncertain business environment. While Brazil’s lack of proscribed market-wide obligations on a set of “gatekeepers” has been sold as a moderation compared to the DMA, it is unclear how CADE would approach imposing obligations on platforms. Without clearer guidance on how CADE intends to exercise these powers, firms may face greater uncertainty when making long-term investment decisions in Brazil. Furthermore, such a system of company-specific obligations could potentially lead to regulatory capture, as firms that have close relationships with CADE could become entrenched.
2. The fast-tracking of the bill minimizes debate and risks locking Brazil into a wide-reaching regime without sufficient consideration of potential consequences. It is unclear that the current antitrust approach is insufficient to address market harms related to digital regulation, and detractors argue that CADE has not made a strong affirmative case that the current market structure is detrimental to consumers or that the alterations it intends would yield better outcomes. The ex ante diminutions of network effects, vertical integration, and self-preferencing may harm consumers and reduce the incentive for innovation.
3. The burdens imposed on major U.S. firms—whether reasonable or not—threaten to undermine an already delicate U.S.-Brazil relationship. These relations have suffered a series of setbacks in the last year, including vocal Brazilian opposition to U.S. operations in Venezuela, Brazil’s blocking of the U.S.-backed e-commerce moratorium extension at the World Trade Organization’s 14th Ministerial Conference, and the recently proposed 25 percent Section 301 tariffs on Brazil for, among other cited reasons, “acts, policies, and practices with respect to digital trade and electronic payment services . . . are unreasonable and burden or restrict U.S. commerce.” Moving forward with this bill raises the prospect of some form of U.S. retaliation, an additional source of uncertainty which could restrain investment.

Conclusion

Brazil’s Fair Competition Act for Digital Markets represents a bold attempt to restructure the country’s digital competition landscape. Its defining feature—regulatory flexibility—creates both opportunities and risks. Proponents of the bill credibly argue that flexibility is necessary in rapidly evolving digital markets and that rigid ex ante rules risk becoming quickly outdated. However, the current text of the bill leaves many open questions about how CADE would use the broad authorities it would stand to gain. Even if these authorities are ultimately used sparingly, current uncertainty could have a tangible economic cost.

The breadth and unpredictability of potential intervention may alter firm behavior, discourage long-term capital commitments, and complicate Brazil’s ambitions to cultivate a dynamic digital economy. Should the bill become law, it will be crucial to monitor the progress of CADE’s designations of platforms, the structure of negotiations with designated platforms, and the ultimate obligations that may be imposed. For this effort to succeed and become a model for other economies, further work needs to be done by the bill’s proponents to create a predictable business environment that encourages investment in Brazil’s growing technology sector.

Evan Brown is a program manager and research assistant with the Economics Program and Scholl Chair in International Business at the Center for Strategic and International Studies (CSIS) in Washington, D.C. Hannah Amran is a research intern with the Economics Program and Scholl Chair in International Business at CSIS.