Source: O Tempo (BH), 23/07/2005

By Emerson Kapaz

The impact of punishments on those who engage in illegal competition practices has been observed from an angle that tends to distort the focus at the heart of the problem. The work that the Federal Police has been doing over the course of a year is by far the greatest emblem of this reality that overturns the old conviction that in Brazil laws are made not to be enforced. Today, due to pressure from society, the environment has changed. Tax evaders, smugglers and counterfeiters? commonly called? pirates? ? have been arrested and prosecuted.

Accountability to the law and competitors is becoming an explosive issue faster than anyone could imagine. In this area, the ETCO Institute is becoming an effective counterforce. Since he started to act, he has contributed to countless advances, among them the Piracy and Fuel CPIs, which supplied the Federal Revenue and the Federal Police with abundant information about the universe of illegality.

However, reforms remain the center of concern. They have been discussed for more than a long decade without an outcome. Reform and punish illegality: these two axes need to go together if society is to effectively build a healthy model of competition. So it is inevitable to find a balance. Taxes need to be lower for the taxpayer base to rise.

The stages of building a new model will be arduous. There are many conflicts to be harmonized, many myths that need to fall. One is that companies that do not respect the law need to be viewed with some complacency because they create jobs in a country with excess unemployment. This partly explains the emotional tone with which the recent arrests made by the Federal Police have been interpreted. But, it is impossible to live with companies that do not comply with the legislation.

Therefore, the police have to punish, naturally avoiding abuses and opening up the possibility of creating incentives for companies that are currently illegal to move to legality. It is a cause-and-effect relationship that is healthy. The moment they take shape, punishments will naturally tend to strip themselves of their spectacular character, to be part of the routine, that is, abuse will not be curbing use.

Executive President of the Brazilian Institute of Competitive Ethics (ETCO)