With every country on the face of Earth, continuing to make efforts to regulate AI, Brazil has once again taken a regulatory step after the Brazil AI Act to regulate AI which as the President Luiz Inácio Lula da Silva suggests is the country’s long-awaited AI governance framework, which if passed by congress, could reshape how AI is built, deployed, and monitored across Latin America’s largest economy.
The proposal which is centered on Bill No. 2338/2023 (PL 2338/2023), has been under debate for more than two years. It represents one of the world’s most comprehensive attempts to regulate AI and reflects growing pressure on governments to respond to rapid advances in automation, generative AI, and algorithmic decision-making.
The bill was approved by Brazil’s Federal Senate in late 2024 and has since undergone further refinement through multi-stakeholder consultations. With its arrival in the Chamber of Deputies (lower house of legislature of Brazil), the country now enters a decisive phase in shaping the future of its AI ecosystem.
What the Bill Proposes?
At its core, PL 2338/2023 adopts a risk-based regulatory model, similar to the approach taken by the European Union under the EU AI act. AI systems would be divided into low, high, and excessive risk categories, with increasing obligations placed on developers and deployers as the risks rise.
Some of the key provisions include:
- A ban on “excessive-risk” systems, including AI-driven mass biometric surveillance without consent.
- Strict obligations for high-risk systems, such as transparency requirements, technical documentation, human oversight, and mandatory risk assessments.
- Clear procedural rights for users, including the right to explanation and the ability to challenge automated decisions.
- A civil liability regime that allows victims of AI-related harm to seek compensation without needing to prove negligence, a move that could significantly reshape future litigation involving AI.
The bill also introduces substantial penalties for violations, with fines that can reach BRL 50 million per infraction, suspension of AI systems, or even bans on market participation. Supporters say these measures place Brazil among the group of countries taking AI harms seriously while still leaving room for innovation. But the debate is far from settled.
Praise and Pushback
Human-rights advocates and digital governance experts have welcomed the bill as a long-overdue framework that places individuals’ rights at the center. For them, Brazil’s decision to explicitly prohibit certain uses of AI especially forms of advanced surveillance signals an important commitment to democratic values.
However, the tech industry’s response has been more cautious. Several Brazilian software and AI trade groups warn that compliance demands may overwhelm smaller companies, discouraging early-stage innovation. Startups worry that mandatory documentation, algorithmic audits, and data governance checks could slow development cycles and raise costs.
Generative AI developers, meanwhile, are concerned about how the bill treats training data and copyright. Ambiguity around what qualifies as lawful data use, they argue, could create legal uncertainty at a critical moment for Brazil’s fast-growing AI sector.
These tensions highlight the high stakes of Brazil’s regulatory push: crafting rules that are strong enough to protect the public, but flexible enough to support technological and economic growth.
Patent Consultation: Brazil Extends Its AI Policy Agenda
As Congress evaluates the AI bill, the Lula administration is making moves in another key area intellectual property.
In September 2025, the National Institute of Industrial Property (INPI) launched a public consultation on how Brazil should evaluate AI-related patent applications. The move signals recognition that AI is not only a governance challenge but also a driver of scientific and commercial innovation.
The consultation seeks public input on:
- How to classify and define AI-related inventions.
- What evidence creators must provide to show novelty and technical contribution.
- Whether inventions autonomously generated by AI can receive patent protection.
- How Brazil should align itself with patent guidelines already adopted by other major economies.
Stakeholders were given nearly 30 questions to respond to, reflecting a deliberate effort to craft modern, internationally harmonized patent rules. The initiative also indicates that Brazil is thinking beyond safe AI deployment and toward the broader innovation ecosystem that supports AI research and entrepreneurship.
Why Brazil’s Choices Matter Globally?
Brazil’s pursuit of a comprehensive AI regulatory regime carries implications well beyond its borders.
As Latin America’s largest digital market and one of the world’s major emerging economies Brazil’s decisions could influence regulatory thinking across the Global South. Policymakers in Chile, Argentina, and Colombia have already begun exploring risk-based AI frameworks, and observers say Brazil’s bill could set the tone for regional harmonization.
Internationally, Brazil’s model blends elements of the EU AI Act with local priorities such as civil rights protections, consumer safeguards, and inclusion. As global discussions on AI governance intensify at the OECD, G20, and UN, Brazil is now positioning itself as an important voice shaping norms in the developing world.
Some analysts see the country’s approach as a potential middle path, one that acknowledges Western regulatory frameworks but adapts them to countries with different socio-economic realities and different capacities for enforcement.
What Comes Next?
The bill now moves to the Chamber of Deputies, where a special committee has been taking expert testimony throughout 2025. A floor vote is expected sometime in early 2026, though political dynamics could accelerate or delay the timeline.
If lawmakers approve the bill, the next phase will involve detailed rule-making by Brazil’s National Data Protection Authority (ANPD) and other sector regulators. These implementation measures will determine how AI audits work in practice, what documentation companies must maintain, and how compliance is monitored across industries.
The rollout of secondary regulations will be critical transforming a legislative blueprint into operational rules for AI developers, businesses, and public-sector institutions.
A Defining Moment for AI Governance in Brazil
Brazil’s move to codify one of the world’s most far-reaching AI laws marks a turning point in its digital governance trajectory. With the AI market expanding rapidly and public concerns mounting around misinformation, surveillance, and algorithmic bias, the country is stepping forward with a model that seeks to balance opportunity with accountability.
Whether the final law will achieve that balance remains an open question. But for now, Brazil has made one thing clear: it intends to shape the global AI conversation, not merely follow it.