Brazil: new laws heaping pressure on recyclers

After a right-wing, liberal government had put Brazil back on track with a surplus and a growing economy, the current government opted to change course and, after three years, the country finds itself in a downward economic spiral, with a growing deficit and billion-dollar scandals.

Meanwhile, steel imports have been badly affecting the domestic industry and driving prices of recycled materials to low levels, leaving no margin to cover operating expenses and creating miserable conditions for recyclers.

The government has enacted a law prohibiting the importation of recycled products which, owing to an unfortunate misinterpretation, considers these materials as waste and opens the door to other bans and regulations to disrupt free trade. And to top it all off, one senator has taken the initiative to introduce a new bill banning exports of metals on the grounds of market regulation and helping recycled material collectors. In reality, this move has created business and legal uncertainty, not to mention taxes that will be implemented at 28% under the new reform.