EU companies bidding for Brazilian government contracts.

The agreement in one table

All “years after entry into force” in the agreement run from 1 May 2026, the start of provisional application.

Which buyers are covered

Federal level:

• the executive, through a named list of about 40 ministries and Presidency bodies (including Health, Defence, Cities, Transport, and Ports and Airports) with their related agencies and foundations;
• the whole federal judiciary, the public prosecution service and the public defender’s office;
• the Chamber of Deputies, the Senate and the Federal Court of Accounts.

Excluded federal bodies: INCRA, the space agency (AEB), the nuclear energy commission (CNEN) and the patent office (INPI). Some sensitive IT and passport services are also excluded.

States: 20 plus the Federal District, at different depths:

• Whole executive: Acre, Amapá, Ceará, Goiás, Maranhão, Mato Grosso, Pará, Paraíba, Rio Grande do Norte, Santa Catarina, São Paulo and Tocantins.
• Whole executive, with exclusions: Amazonas (cultural goods and services and the Amazon “environmental economy” excluded).
• Whole executive plus other bodies:
  • Paraná, plus its judiciary, assembly, audit court, prosecutors and public defender;
  • Rio de Janeiro, plus its audit court and prosecutors.
• Named bodies only:
  • the Federal District (about 70 bodies);
  • Minas Gerais;
  • Pernambuco (the central procurement and control bodies);
  • Rio Grande do Sul;
  • Rondônia (one secretariat);
  • Roraima (13 bidding committees plus its court).

Not covered: Alagoas, Bahia, Espírito Santo, Mato Grosso do Sul, Piauí and Sergipe; all municipalities; and state-owned companies such as Petrobras.

What’s covered

Thresholds:

Values are the maximum total over the contract’s life, including options, and contracts can’t be split to avoid the threshold. Convert SDR at current IMF rates.

Goods: everything except listed groups, which include:

• agricultural, earthmoving, mining and drilling equipment;
• cranes, and road-clearing and asphalt equipment;
• air-conditioning;
• chemicals, gases and pesticides.

Services: a closed list. Covered:

• architecture, engineering and urban planning;
• management consulting and market research;
• project management;
• technical testing;
• services incidental to agriculture, forestry and fishing;
• building cleaning, packaging and convention services;
• sewage services.

Not covered: IT and software services, legal, accounting, advertising, security, transport, financial services, R&D and maintenance.

Works: all construction (CPC Division 51). Works concessions above the threshold get only the non-discrimination rule.

Excluded everywhere:

• anything related to the SUS, the public health system;
• food security and school-meal programmes buying from family farms;
• service concessions, permits and authorisations;
• purchases abroad;
• defence and national security, through the security exception.

What you gain over Brazilian law alone

Brazil’s procurement law (Law 14.133/2021) already lets foreign companies bid in international tenders and accepts equivalent foreign documents. In a covered tender the agreement adds:

• National treatment, “immediately and unconditionally” (Art. 12.6).

• No Brazilian-experience test. Buyers must count experience inside and outside Brazil, can’t require prior Brazilian contracts or work, and must accept equivalent documents (Art. 12.14).

• Fair specifications that don’t limit competition or discriminate (Art. 12.16).

• Longer tender periods: at least 40 days, reduced by 5 days for each of electronic notice, electronic documents and electronic submission. A fully electronic tender can go to 25 days, and the floor is 10 days in limited cases (Annex 12-M). Brazilian law alone allows as little as 8 business days for some goods.

• Free electronic notices through a single point of access: Brazil names PNCP and Compras.gov.br.

• Debriefs: on request, the reasons you lost and the winner’s relative advantages (Art. 12.23).

• Challenges (Art. 12.25):

  • review by an impartial body independent of the buyer;
  • at least 10 days to file;
  • rapid interim measures;
  • corrective action or compensation.

  Brazilian law alone gives just 3 business days for many challenges. Brazil hasn’t published implementing rules, so use the existing routes (impugnação, recurso, a complaint to the audit court, or the courts) and cite the agreement.

• An edge over non-EU rivals. Brazil isn’t in the WTO GPA, so companies from countries without a similar deal compete only under domestic law.

Not yet: Brazil only has to publish summary notices in English, French or Spanish from about May 2029.

The subsidiary clause: protection across all procurement

For the EU–Brazil pair, a footnote to Article 12.6 means an EU-owned company established in Brazil can’t be treated worse because of its EU ownership in any Brazilian procurement, including municipalities, state companies and below-threshold tenders, subject to the security exceptions.

Watch the denial-of-benefits clause: Brazil can deny the benefits to a service supplier that has no substantial business operations in the EU (Art. 12.10). Shell companies are at risk, so make sure the EU parent is a real operating business.

What Brazil keeps

• National preference margins under federal law, with no phase-out: up to 10%, or up to 20% for products of national technological development (Law 14.133, Art. 26). Brazil must notify the EU within 30 days of decisions that may apply them.
• Offsets, if non-discriminatory, set out in the tender documents and flagged in the notice. No phase-out.
• Small business preferences: price preferences and set-asides of up to 25% of the purchase for micro and small enterprises.

The European Commission has described the deal as removing most preferences for domestic firms. The annex text keeps the margins, so price your bids assuming they apply.

Practical steps for an EU company

1. Search PNCP and Compras.gov.br, and use Brazil’s Novo PAC and PPI investment programmes as pipeline intelligence.

2. Check coverage. All four must hold:

   • the buyer is a covered federal or state body;
   • the purchase is covered (goods not on the excluded list, a listed service, or works);
   • the value is at or above the threshold;
   • no exclusion applies.

3. Register in SICAF as a foreign supplier. You don’t need a Brazilian tax number to start. See SICAF registration for foreign companies.

4. Prepare for each tender notice (edital):

   • apostilled and translated corporate, tax and financial documents;
   • local representation;
   • an accepted electronic signature.

5. Read the edital against the agreement. Check:

   • a tender period of at least 40 days, less the electronic reductions;
   • foreign experience counted;
   • equivalent certificates accepted;
   • no brand or origin specifications;
   • any preference margin or offset disclosed in the notice.

   If something’s wrong, file a clarification request or a challenge (impugnação) citing Articles 12.14, 12.16 and 12.18 and Annex 12-M.

6. Price for the margins. Domestic and small-business preferences can still apply.

7. Consider a Brazilian subsidiary or consortium to use the subsidiary clause across all procurement. See consortium and joint venture bidding rules.

8. Escalate systemic problems to the EU Delegation in Brazil or the Commission’s trade department. Government-to-government dispute settlement is for governments, not companies.

The other Mercosur countries

• Argentina and Uruguay have ratified and apply the agreement from 1 May 2026. Their central-government thresholds start higher and step down over 10–15 years, and they’ll consult their provinces and departments on sub-central coverage within two years.
• Paraguay’s procurement annex applies only after it sends a written notification, due within three years.
• Legal challenge: in January 2026 the European Parliament asked the EU Court of Justice for an opinion on the agreement (Opinion 1/26). The Commission went ahead with provisional application, and no ruling has been reported.

The reverse direction

Brazilian suppliers get access to EU institutions and member-state central government bodies at SDR 130,000 for goods and services and SDR 5 million for works, from day one. The EU’s regional and local buyers aren’t covered until Brazil widens its own coverage, and health and utilities are excluded.

What changed in 2025–2026

• 3 September 2025: the Commission proposed splitting the deal into a partnership agreement and an interim trade agreement.
• 17 January 2026: signed in Asunción.
• 21 January 2026: the European Parliament referred it to the EU Court of Justice.
• February–March 2026: Mercosur ratifications; Brazil’s Congress approved it on 17 March.
• 28 April 2026: Decree 12.953 promulgated it in Brazil.
• 1 May 2026: provisional application began. This is Brazil’s first binding procurement commitment, and its first sub-central coverage.
• June 2026: the EU Delegation published a guide to the procurement chapter.

Coming: English, French or Spanish summary notices from about May 2029; lower federal thresholds from about May 2033.

For the general process, see how to bid for public contracts in Brazil and the Brazilian procurement glossary.

Live Brazilian tenders

Questions

Sources

• European Commission: EU–Mercosur agreement text
• Brazil: Decree 12.953/2026 promulgating the agreement (Planalto)
• Brazil: Law 14.133/2021, the public procurement law (Planalto)
• Brazil: National Public Procurement Portal (PNCP)
• Brazil: Compras.gov.br

This guide explains the rules in plain English; it isn’t legal advice. Procurement rules change, and each tender document sets its own conditions — it always prevails.