Provisional Measure No. 1,309 (“PM”), of August 13, 2025, was enacted in direct response to the so-called tarifaço imposed by the United States, which established additional tariffs on various Brazilian products. As part of the Brazil Sovereign Plan, the measure sets forth an emergency package to mitigate the economic impacts of this trade barrier, encompassing financial support to exporting companies, adjustments to tax regimes, and amendments to export insurance and guarantee mechanisms. The PM will still be reviewed by the National Congress within the legal timeframe, and is subject to amendments and changes by lawmakers that may alter the proposals submitted by the federal government.
While the PM addresses multiple support instruments, the area of greatest concern from an integrity and risk management standpoint lies in Chapter VIII, which significantly eases government procurement rules for the acquisition of food products no longer exported due to the tarifaço. This creates an environment of heightened exposure to regulatory, operational, and reputational risks.
Although the measure aims to ensure the domestic supply of strategic products, the easing of procurement procedures increases the risk of irregular practices, requiring heightened attention from companies intending to participate in these opportunities.
Proposed Exceptional Easing of Government Procurement under the PM
- Direct contracting without bidding, with submission of a simplified terms of reference, for the purchase of eligible food products as defined in a joint order issued by the Ministry of Agriculture and Livestock (MAPA) and the Ministry of Agrarian Development and Family Agriculture (MDA).
- Simplified terms of reference must mandatorily include: definition of the object, brief justification, description of the solution, contracting requirements, measurement and payment criteria, price estimates, and budgetary adequacy.
- Waiver of preliminary technical studies and possibility of using the price registration system, with adherence limited to up to five times the quantity originally registered for each item.
- Maximum term of 180 days for contracts executed under these exceptional rules, and contracting allowed within 180 days of the publication of this PM.
- Estimated price to be defined based on the average of values obtained through a survey among potential qualified suppliers.
- Mandatory public disclosure of the mitigation strategy and the public policies served, on the contracting authority’s official website or, if unavailable, in a visible location at its headquarters.
Compliance Considerations
The possibility of direct contracting, combined with the simplification of procedural requirements, is likely to increase the attractiveness of these opportunities for suppliers.
However, this same flexibility significantly heightens exposure to legal, regulatory, and reputational risks. In this context, it is essential for companies to adopt robust internal controls and governance practices to ensure integrity throughout all stages of negotiation and contract performance.
Qualification and proof of requirements
Ensure that both the product and the company fully meet the criteria set forth in the joint ministerial order. All documentation should be kept organized for prompt submission during audits or inspections.
Price formation transparency
Ensure that pricing is determined in accordance with market parameters, with documentary records of all references used. Any evidence of prior price fixing or artificial value formation may constitute an administrative violation and a criminal offense against the economic order.
Integrity in consortia and partnerships
If participation occurs through a consortium, joint venture, or partnership, conduct prior assessment of the partners’ reputation and compliance history.
Prevention of conflicts of interest and harmful acts
Implement internal mechanisms to prevent undue favoritism, influence peddling, or offering improper advantages to public officials.
Traceability and consistency of information
Maintain complete records of negotiations, deliveries, and payments, ensuring consistency with official public disclosures and avoiding disputes or investigations.
Ongoing training and monitoring
Train teams responsible for negotiation and contract execution, reinforcing integrity protocols.
Ongoing due diligence
Reassess periodically contractual risks during performance.
Conclusion
Participation in direct contracting processes under the PM requires an agile corporate response, but not at the expense of integrity. Strengthened internal controls, transparency, and monitoring are essential to seize these opportunities without compromising reputation or incurring legal risks.
Our Compliance and Investigations team is closely monitoring the congressional discussions on the Provisional Measure and is available to assist companies interested in assessing risks, reviewing procedures, and implementing internal controls to ensure safe participation in these exceptional procurement processes.