Brazil, US sign agreement on customs recognition

Brazilian companies certified as Authorized Economic Operators (AEO) will be able to export to the US faster and with less red tape. After seven years of talks, Brazil’s Federal Revenue Service signed a mutual recognition agreement with the US customs.

The two countries thus formalize the collaboration between their authorized economic operator programs. Through the deal, customs in both nations recognize businesses that operate in the international supply chain with certified cargo safety and compliance with tax and customs standards. Joining the initiative is voluntary.

Discussions between the technical teams of Brazil’s Federal Revenue Service and the US Customs and Border Protection Service began in 2015 with the signing of the joint work plan. After the accord, the Brazilian AEO program became compatible with the Customs Trade Partnership Against Terrorism (C-TPAT), one of the world’s top certification programs in supply chain security.

Now, Brazilian businesses certified under AEO-Security will be recognized as safer and posing lower risk. With increased reliability, inspections of Brazilian exports to the US are expected to be reduced. Furthermore, when cargoes from these organizations are selected for verification, they should be given priority in the examination.

The destination of 14 percent of the country’s exports, the US is Brazil’s second largest trading partner, with a flow of more than $70.53 billion in 2021. Of this total, Brazil exported $31.15 billion to the North American country and imported $39.38 billion.

According to the Ministry of Economy, in the last three years, firms in the AEO Program accounted for 17 percent of exports to the US. The ministry did not disclose detailed estimates, but reported that the move should lead to a higher demand for AEO-Security certification among Brazilian companies.