By Igor Andrade and Fernanda Arbex, partners at Innova Public Affairs*
The advancement of the digital economy has placed data infrastructure at the center of development strategies in several countries. In Brazil, this movement has recently gained momentum, with initiatives aimed at creating a more competitive environment to attract investments in data centers and related technologies. However, the evolution of this debate reveals a scenario marked by regulatory inconsistencies and challenges in political coordination.
One of the key milestones in this agenda was the issuance of Provisional Measure No. 1,318/2025, which established the Special Incentives Regime for Data Centers (REDATA), with the objective of reducing the costs of deploying and operating such infrastructure in the country. The measure, however, was not converted into law within the constitutional deadline and ultimately expired. In response, the Executive Branch moved to reintroduce its provisions through Bill No. 278/2026, broadly preserving the originally proposed mechanisms.
The progress of this matter, however, began to face additional obstacles as it intersected with another relevant regulatory debate: Bill No. 2,338/2024, which addresses the regulation of artificial intelligence in Brazil. During the discussions, the rapporteur, Congressman Aguinaldo Ribeiro (PP/PB), signaled his intention to incorporate REDATA into the AI regulation framework. Although the initiative aimed to bring greater coherence to the digital agenda, it generated unintended consequences. By attempting to consolidate distinct issues into a single legislative proposal, the move contributed to delays on both fronts, increasing regulatory uncertainty.
This uncertainty is further reinforced by the inherent challenges involved in establishing a legal framework for artificial intelligence. The issue requires balancing incentives for innovation, protection of rights, and risk mitigation. So far, there is no consolidated consensus among the government, Congress, the private sector, and civil society regarding the ideal regulatory design. As a result, the legislative process is likely to progress gradually and remain subject to revisions, directly affecting the predictability required for investment decisions in technological infrastructure.
At the same time, trade policy decisions have also influenced this environment. GECEX Resolution No. 852 increased import duties on equipment considered essential for the construction and operation of data centers and other digital infrastructures. While aligned with a broader industrial policy rationale and domestic production protection, the measure has a direct impact on the cost of implementing such projects in Brazil.
The outcome is a set of, at times, contradictory signals. On one hand, the government seeks to position Brazil as a relevant destination for digital infrastructure investments, recognizing the strategic role of data centers in the new economy. On the other, overlapping regulatory initiatives, delays in defining legal frameworks, and decisions that increase the cost of critical inputs ultimately reduce the attractiveness of the business environment.
In the short term, the issue is likely to remain in the background of political debate, given the centrality of the 2026 elections. Nevertheless, this is a structural agenda that is expected to gain traction from 2027 onward, regardless of the electoral outcome. Establishing a more stable and coherent regulatory environment will be a necessary condition for Brazil to effectively compete for investments in a sector that is increasingly strategic for economic growth and the country’s global integration.
*This text does not necessarily reflect the opinion of CCBC and is the sole responsibility of the authors who sign this content
