2005, the turning point


Published in the Correio Braziliense newspaper on December 2, 2004

By Emerson Kapaz *

In terms of competition ethics, 2005 promises to be modeled by two relevant facts. First, due to the positive impacts of the creation of the National Council to Combat Piracy and Intellectual Property Offenses, a new step forward in the formulation of a comprehensive policy to combat tax evasion, counterfeiting and smuggling. At the same time, the economy will begin to reap the rewards of the clear perception that today government, business and citizens now have regarding the serious problems of informality.

A series of positive developments underpin optimistic forecasts. For example, the government has started to work effectively on a process of cleaning up the Federal Police. It is a surgical operation cutting into the meat itself, only a meat that has rotted. Consequently, the encirclement has been closing in on tax evaders and organized crime, initiating an unprecedented process of ending impunity. In the Highway Police, identical process also gains firm features. They are indicators of the determination to prevent corruption from contaminating organisms that need to be healthy for public administration to operate with impartiality and within the legal framework.

At the same time, in January and February, flow meters to control production in the beer industry and, shortly thereafter, in the soft drink area will enter the scene. Control mechanisms are also being studied for the cigarette industry. In the field of fuels, the practice of adulteration is under the scrutiny of inspection and the tendency is for those companies that act irregularly to be more and more inspected and to lose ground. Even because the consumer now knows how to distinguish them from ethical companies that sell quality products.

The truth is that if we manage to keep the work that has been done for ten years, we will promote far-reaching cultural changes. The citizen observes the movements of the authorities, monitors and is interested in a new scale of values. A little less than two years ago, all this was nothing more than an exercise in fiction. An ambiguous and mistaken view prevailed. People said: informality is bad, but it creates jobs. This view has been demystified. It fell to the ground. Now, everyone knows that the supposed benefits ?? informality are nothing more than a mirage. Rather than helping to create jobs, informality has a severe impact on economic growth, generating mediocre, if not ridiculous, growth rates and causing serious setbacks in the supply of formal jobs. In other words, in informality, a recent McKinsey study proved, it is impossible to meet the demand of millions of workers who need decent and productive jobs.

In this context, the National Council for Combating Piracy and Offenses against Intellectual Property, due to the breadth of its functions and the characteristics of its participants, stands out as a milestone in the history of combating illegal competition. An advantage is the participation of civil society, which did not exist in the commissions that were operating until then. The Council comprises an autonomous executive secretariat, not linked to the ministries, with its own budget for the creation of a database that will be linked to Susp, which is the Single Public Security System. And this database will become an intelligence center in the fight against illegality in Brazil. Thus, institutional campaigns will appear, such as the one that should be launched immediately, called Legal Christmas.

In addition, there is an unprecedented difference: the federal government participates with seven ministries, plus the Federal Police, the Federal Highway Police, the Federal Revenue Service, two representatives of Congress and six representatives of civil society. Thus, we are evolving from a defensive attitude to an offensive one. The path was built for the integration between organized civil society and public power.

In other words, unethical companies will be in an increasingly fragile position. For these reasons, 2005 will certainly be the right time to take a leap forward. A definitive year in the fight against illegality.

* President of the Brazilian Institute of Ethics in Competition? Etco (www.etc.org.br)