Brazil's intermediary liability regime is being rewritten at the same moment Washington has made Brazilian content-removal practice a trade grievance. The two processes are usually discussed separately. They should be read together, because each one weakens the predictability that open-internet economies depend on.
What Brazil changed
On August 20, 2026, the Electronic Frontier Foundation's Veridiana Alimonti described the regime now taking shape. The Supreme Court invalidated parts of the old rule under Article 19 of the Marco Civil da Internet, which had protected platforms from liability until a judicial order was ignored. In its place is a notice-and-takedown model. Platforms must act on user notifications unless there is reasonable doubt that the content is unlawful. For serious offences such as human trafficking and crimes against women, platforms carry a duty of care, and liability for systemic failure. The Court issued a clarifying decision in June 2026.
EFF also reports that two presidential decrees issued in May 2026 add to this. Decree 12.975 amends the 2016 regulation implementing the Marco Civil. It requires users to be told of removal decisions and given an appeal. It also requires platforms to report criminal content to the authorities along with information that can identify the user. Decree 12.976 defines online violence against women in broad terms. EFF says the decrees also give the data protection agency, ANPD, penalty powers over content-related obligations. EFF argues those powers exceed the agency's statutory mandate and should be set by law, not decree.
The strongest case for Brazil's approach
The case for reform is serious. Under the old rule, a platform could leave up a coordinated harassment campaign or a trafficking ad until a judge ruled, and victims without lawyers had little recourse. The Court concluded that judicial-order-only liability did not adequately protect democracy or fundamental rights. A duty of care for the gravest categories is defensible, and requiring notice and appeal for removals is a real improvement in due process for users. A sovereign country can set liability rules for services operating within it.
Where the design becomes a problem
The concern is not that Brazil regulates. It is how much is left undefined. EFF notes that "systemic failure" is imprecise. It also notes that the treatment of open groups in encrypted apps is ambiguous and that "violence against women" is defined broadly. Where the liability standard is unclear, the rational response for a platform is to over-remove. That erodes protected speech, and it burdens smaller and domestic services more than the incumbents that can afford large moderation teams.
The reporting duty is the sharpest example. Sending user-identifying data to authorities on the platform's own assessment of criminality, without a court order, turns platforms into a surveillance intermediary. Assigning enforcement to ANPD by decree adds an institutional risk. Penalties that rest on executive instruments rather than statute are easier to challenge and easier to apply selectively.
The trade overlay
These rules are landing in a charged environment. The U.S. Trade Representative's Section 301 action imposes a 25% tariff on certain Brazilian goods, effective July 22, 2026. USTR's fact sheet says Brazilian courts have issued secret orders directing U.S. companies including X, Meta and Google to remove political content and suspend accounts, and have imposed fines and asset restrictions for non-compliance. The fact sheet also says Brazil has disadvantaged U.S. payment companies through policies favouring Pix. In the action announcement, Ambassador Greer framed the case around U.S. companies being punished for refusing to censor political speech.
Note that USTR's complaint concerns court orders, not the new notice-and-takedown scheme. EFF's analysis does not mention Section 301 at all. The link is therefore one of context, not causation: the same country is tightening platform obligations while being penalised over earlier removal practice. It would be wrong to say the tariffs respond to the decrees.
The Pix claim is also more contested than the headline suggests. In an analysis published August 31, 2026, Simon Lester notes that the Central Bank both regulates and operates Pix, which USTR treats as a conflict of interest. He also notes that defenders see Pix as transparent public infrastructure that expanded the market. Lester warns that using negative economic impact as the standard, rather than non-discrimination, could justify challenges to many legitimate domestic policies.
Why the pairing matters
Both tracks substitute discretion for rules. Brazil's regime leaves key terms to future interpretation and enforcement by an agency working from decrees. The U.S. action turns a bundle of domestic policy disputes into a single tariff with an elastic legal standard. Neither gives a platform, a payments firm or a user a stable rule to plan around.
There is a better path on each side. Brazil can move the ANPD's powers and the reporting duty into legislation, define systemic failure narrowly, publish transparency data on government takedown and identification requests, and require court authorisation before user data is handed over. The U.S. can pursue transparency of court orders through negotiation, pressing for the notification rights that Decree 12.975 partly supplies, rather than tariffs that fall on unrelated exporters.
What to watch
- Whether ANPD's content-related penalty powers are challenged for lacking a statutory basis.
- Whether platforms publish data on identification reports sent to authorities.
- Whether any Brazil-U.S. negotiation treats removal-order transparency as a deliverable.
Proportionate liability rules and open trade are compatible. The risk is a Brazil where the rules are unclear and a trade dispute where the standards are vague, with users and small firms bearing the cost of both.