Before Brazil Scrubs In: The Case Against Digital-Market Surgery

Key Takeaways

• Bill creates Digital Markets Superintendency within CADE, designating firms up to 10 years
• Existing CADE settlements with Apple and Google already impose similar remedies
• EU DMA experience shows higher compliance costs with limited competition gains
• New regime could add $340 billion annual Custo Brasil burden
• Critics urge strengthening ex‑post tools instead of broad ex‑ante rules

Pulse Analysis

Brazil’s draft Bill 4,675/2025 seeks to overhaul digital‑market regulation by inserting a new Digital Markets Superintendency inside CADE, the country’s competition authority. The legislation blends elements of the EU’s Digital Markets Act—such as ex‑ante obligations for designated platforms—with the UK’s two‑step approach that lets the regulator study a firm before imposing duties. Proponents claim this will speed up enforcement in fast‑moving tech sectors, yet the bill also introduces decade‑long designations and an open‑ended menu of obligations, raising questions about institutional capacity and legal certainty.

Recent CADE actions suggest the existing ex‑post framework may already deliver many of the outcomes the bill promises. In late 2025, CADE secured settlements with Apple and Google that forced the companies to open app stores, allow alternative payment processors and curb anti‑steering practices—remedies that echo the structural fixes envisioned in the draft law. A 2026 administrative inquiry into Meta’s WhatsApp changes further demonstrates CADE’s willingness to act swiftly when consumer harm is evident. However, the agency’s limited budget and staffing mean that expanding its remit without additional resources could dilute focus from core antitrust work.

Importing a DMA‑style regime also risks amplifying Brazil’s notorious "Custo Brasil," an estimated R$1.7 trillion (about $340 billion) annual burden on businesses. Early EU experience shows that ex‑ante rules can create user friction, higher compliance costs and an "innovation tax" that delays product launches. For Brazil, a more prudent path may be to reinforce CADE’s ex‑post tools, introduce targeted measures where needed, and conduct a rigorous regulatory impact assessment before committing to sweeping legislation. This approach would protect consumer welfare, preserve market dynamism, and avoid adding unnecessary bureaucracy to an already complex business environment.