Computer Technology in Brazil:

From Protectionism and National Sovereignty to

Globalization and Market Competitiveness

Henrique Luiz Cukierman

This article seeks to outline some initial conclusions of ongoing research

into the controversies and congressional debates that took place during
the passage through the Brazilian National Congress of the bills (dated
1984, 1991, 2001, 2004) relating to informatics activities in Brazil, ^^^:^ich
topics did the congressional controversies "heat up" around, and which
led to their "cooling off so as to make the formulation of a new law pos-
sible? What were the issues at stake that led to the promulgation of four
informatics laws in such a short space of time? What led these debates
from market protectionism and national sovereignty to globalization and
market competitiveness? These questions can be answered by the a priori
definition of groups and interests. However, the choice in this article is to
follow the actors and their own strategies of formation and dissolution of
groups, focusing on the tracks left by the debates in Congress, especially
those formally recorded in congressional documents and in the press.

The present article presents preliminary conclusions of ongoing

research into controversies that occurred during the passage of bills re-
lating to informatics activities in the National Congress of Brazil (1984,
1991, 2001, and 2004). The debates show an evolution from the fierce
defense of national sovereignty and protectionism, as promulgated in
the first law (1984), to a concern about globalization and market com-
petitiveness, as expressed through the last three (1991, 2001, 2004).
What themes were debated by the members of Congress? Around which
topics did controversy escalate? What voices were heard from so-called
civil society? Did members of Congress act along party lines? Is it pos-
sible to identify the beneficiaries of certain decisions in the drawing up
of the final text of each of these laws?

Henrique Luiz Cukierman is an associate professor at the Federal University of Rio

Janeiro (UFRJ), Rio de Janeiro, Brazil, and a Humboldt Fellow.

¡nformalion (i Culture, Vol. 48, No. 4, 2013

©2013 by the Universit)' of Texas Press
DOI: 10.7D60/IC48404
480 1L8CC/ Computer Technology in Brazil

These are some of the questions surrounding each of the four laws
on informatics. It is possible to address these questions through the a
priori definition of groups and interests (generally identified on the ba-
sis of overarching political and social contexts). There is another path,
however, and this research intends to follow it. This article follows the
actors and their strategies of formation and dissolution of groups. The
definition of groups is no longer the exclusive task of social scientists
but of the actors themselves. They are the ones who make sociology for
the sociologists, and the sociologists should therefore learn from the
way these actors establish their associations. A reference for such an op-
tion is provided by the proposals formulated by Bruno Latour, in which
there are no previously ready and established groups but only groups
in permanent formation and dissolution.' In order to describe them,
he suggests that the groups be tracked at the first signs of their con-
stitution and then observed and monitored as they develop. First, the
spokespersons who speak on behalf of the group should be observed,
given that all groups need people who define who they are, what they
should be, and what they have been. Second, the "antigroups" should
be monitored. Whenever any effort has to be made to draw or redraw
the boundaries of a group, other groups are designated as being empty,
archaic, dangerous, conservative, and so forth. It is always in comparison
with other competing ties that any particular tie is emphasized. Thus, for
each group that is formed, a list of antigroups is also formed. Third, the
boundaries that separate the different groups being formed should be
monitored. When groups are formed or are redistributed, their spokes-
persons seek ways of defining them at any cost. Fragile boundaries have
to be marked, delimited, and fixed so that they become durable. Finally,
the societal spokespersons who make the durable definition of groups
possible, that is, sociologists, social scientists, statisticians, and journal-
ists, should be observed. Social aggregates are no longer the objects of
an ostensible definition; instead, they are subject only to a performative
definition. No group can last without the permanent work of maintain-
ing it, or, as Latour prefers, "without work there is no group."^
Another strand of this research involves comparing the passages of
the four informatics laws through the National Congress. Why were four
laws promulgated in such a short space of time? What led to the pro-
posal of a new law? What changed in terms of the themes proposed and
the positions of members of Congress? Which controversies remained,
which were renewed, and which were inaugurated? When discussions
of a new bill began, was it possible to identify new beneficiaries, new
groups, new lobbies? Which groups were formed, and which were dis-
solved during each promulgation of a new law?
 481
The present stage of the research is concentrated exclusively on
the forming and dissoludon of groups that can be traced through the
documents of the Nadonal Congress. Parliamentary work leading to
the approval of a new law is formally recorded, and there is also press
coverage of this same work. Thus, the sources we used to follow these ac-
tors—the politicians—are the National Congress Gazette and, at least during
this initial stage of the research, the Folha de Sao Paulo, a daily newspaper.
To reiterate, the aim of the research was to monitor the discourse as it
appeared in the published discussions of members of Congress.

A Law Seeking the (Re) affirmation of Technological Autonomy

The discussion around informatics law that took place during 1983
and 1984 sought to reaffirm the country's technological autonomy in
computer manufacturing. The idea was to reaffirm the principles that
had, from the mid-1970s onward, guided the establishment of a market
reserve, which prohibited the importing of minicomputers, reserving the
Brazilian market exclusively for minicomputers produced domesdcally
with local technology. The issue of autonomy—not just in the techno-
logical domain—has been, since the nineteenth century, a prominent
concern for most members of Brazil's intellectual elite. For them, it was a
matter of including Brazil in the map of the so-called civilized countries,
a goal they saw as the overcoming of differences between Brazil and the
"civilized" nations perceived solely as a "flaw" and never as an advantage
or even as an opportunity for the producdon of new knowledge, new
lessons, and new atdtudes. Leyla Perrone-Moisés attempts to explain this
"flaw" in terms of Ladn American culture, observing with great propri-
ety that "the Old World when looking at the New should find neither its
own mirrored and degraded face, nor a totally exotic face destined to
amuse it or move it at a distance, but a face that returned its gaze and
showed it that there were other ways of seeing oneself and the other.
Our aim should be to stop trying to 'impress Europe' and simply show it
the different things we did with what it brought us."^
It is worth noting that many countries had established a target of
achieving the technological autonomy needed to produce computers
between the mid-1950s and the mid-1970s. This period was character-
ized internadonally by the quest for national competency in the design
and manufacture of computers, as highlighted by Vardalas:

Between 1945 and 1975, a new generadon of entrepreneurs created

new industries to exploit digital electronic techniques. It was also
during this period that each nation created the core of academic.
482 I&C/ Computer Technology in Brazil

governmental, and industrial expertise in which present-day tech-

nical competence in the digital universe is rooted. It was during
those years that the major industrialized nations of the world,
challenged by the technological and industrial hegemony of the
United States, first scrambled to assert domestic design and manu-
facturing competence within the paradigm of digital electronics.*

Although this passage refers to other major industrialized nadons of the

world, especially Canada, it can be used to describe the Brazilian case.
In Brazil, the development of a domestic informadon technology sector
occurred later (from the 1970s onward) in conjuncdon with the defense
expansion policies of Brazil's military government.

The Congressional Debates in 1984: Initial Observations

The debates of the 1984 informatics law (Law 7.232 of October 29,
1984) in the Brazilian Congress ignored the impact of the personal
computer, which was transforming the computing industry. The popu-
larizadon of personal computers had already begun with the commercial
launching of Apple II in 1977 and later the huge spread of the IBM
PCs. So while the Brazilian Congress was discussing an autonomy based
on minicomputer technology (the so-called minis), which had already
been losing ground to personal microcomputers, a severe blow to the
market reserve was dealt by the flooding of foreign IBM PC-like models
smuggled into Brazilian territory. The availability of these models, which
were much cheaper than their Brazilian counterparts, provoked the
anger of local consumers. The press used the opportunity to fiercely at-
tack the market reserve (which protected the PC market with the same
measures taken in regard to the minicomputer market, as the former
were a mere "extension" of the latter)." Samples of that anger sdll a p
pear today, as evidenced by this recent post (October 11, 2012) from a
Brazilian journalist's blog:

We lived then in the middle of the market reserve, one of the most
stupid and retrograde measures that this country had adopted. I
also bought my first (and second, and third, and fourth . . .) com-
puter with a smuggler. It cost US$ 2.200 not including the monitor
(plus US$ 850). One should remind that we are talking about
the mid-80s currency, when the USD was worth at least the dou-
ble of its actual value. If one bought a Brazilian computer, s/he
would take an inferior machine at triple the price. Any person.
 483

in good conscience, would not be that crazy. . . . [The Brazilian]

Government . . . did not understand that to prohibit access to
technology goods was equivalent to prohibit the development of
the country.^

The Congress granted the market reserve a legal support at the very
moment when it was under siege not only by its tradidonal political en-
emies but also by its middle-class consumers.
Although classified as a "home appliance," the personal computer's
performance increasingly vied with that of a minicomputer but at a
much lower price. Designed for corporate use, the mini was more ex-
pensive. In the congressional debates, "consumer" and "user" referred
solely to industry, commerce, and the government as a whole.
Another issue not discussed by Congress was the creation of a mar-
ket reserve for the production of minicomputers. This was established
nearly a decade before by a resolution of a body of the executive branch,
the Commission for the Coordination of Electronic Processing Activities
(CAPRE). Resoludon number 1, promulgated on July 15, 1976, rec-
ommended that the minicomputer segment should be reserved for
domestic industry, as stated in its text: "The nadonal informatics pol-
icy towards the computer market, involving mini and microcomputers,
their peripherals, modern data transcription and transmission equip-
ment and terminals [should be oriented] towards ensuring the control
of initiatives aimed at creating conditions for the consolidation of an
industry with total control of technology and decisions in the country."'
The 1984 information technology law formalized a reserve that had
already been in existence for a considerable period of dme. It should
be remembered that, of the four laws, this is the only one that explicitly
mentions the desire to establish a national informatics policy. A mixed
congressional commission (formed by representadves and senators) was
formed to hasten its approval, which was achieved in record dme (four
months). Spokespersons from groups affected by informadcs policy
made a series of presentations and afterward answered questions made
by the commission's congressional members. Debate between the mem-
bers of Congress on the commission often occurred indirectly through
the questions put to these spokespersons. It should be highlighted that
two congressmen—Tancredo Neves and Paulo Maluf—^were specially
invited at the last minute to sit on the commission. The discussion of
the informadon technology law constituted a privileged platform for
the two candidates standing in the indirect presidential elections. This
reveals the strategic nature of the informatics policy for the candidates
484 I&C/ Computer Technology in Brazil

and the country. What was at stake was a bipolarity, with those who de-
fended autonomy on one side and those who were fighdng for an end to
the reserve, or at least more fiexible rules, on the other. As was pointed
out above, this bipolarity was much more related to a prior definition of
groups, facilitated by the bipolarity of the two major parties, the PMDB
and the PDS, than to the effective mapping of groups based on the dis-
courses of members of Congress. (Indeed, members of both parties
were distributed between these two poles; i.e., they were not organized
along party lines.)
The aim of the market reserve that had been in force since 1976
was basically to create and defend Brazilian hardware industries,
which would be unable to survive in the face of foreign competition
until they could "stand on their own feet." Moreover, mastering infor-
mation technology was treated in the debates as a strategic matter and
absolutely fundamental for the country's technological development.
Some speakers, like Professor Clodovaldo Pavan, then president of the
Brazilian Society for the Progress of Science (SBPC), went even further,
affirming that information technology constituted an important instru-
ment for the preservation of national sovereignty. Others, like Eduardo
Guy, then president of the Association of Data Processing Companies
(ASSESPRO), emphasized the power of information technology in re-
gard to the decisions that would determine the country's future course.
The transcriptions of the debates published in the National Congress
Gazette show, in principle, that they served two purposes. The first was
to clarify the issues involved and the doubts of members of Congress
regarding the informatics theme. The second was to hear the opinions
of people related to industry, information technology, universities, and
government. Different spokespersons obviously had different opinions
about various aspects of the law. For example, Edson Fregni, president
of the Brazilian Association of Computer and Peripherals Industries
(ABICOMP), believed that the industry was doing very well, whereas
Representative Roberto Campos, a staunch opponent of the reserve, un-
surprisingly had a completely opposite view.
The law's passage was polarized around some constantly recurring
topics in the discussions: the degree of state intervention in the national
informatics policy; the urgency of the bill's passage; the participation
of foreign firms and the polemical definition of what constituted a na-
tional firm; the most appropriate ways of setting up the market reserve;
the law's reach and the information technology industry's relation with
other industrial sectors; technology transfer; and the risk of having ex-
cessive power concentrated in the executive branch.
 485
The main argument deployed by those who questioned the need for
the bill's urgent passage was that the theme that was so complex and
constituted a matter of such national interest could not be discussed
and approved in only a few months. Its defenders, however, alleged
that the evolution of technology and Brazilian industry's backwardness
needed swift decisions. This contrasted with the typical slowness of gov-
ernment bureaucracies and the usually lengthy passage of bills through
the National Congress. The speed of its passage seems to indicate that
the law's final text had been sufficiendy discussed beforehand by the
various parties involved. In retrospect, it is also possible to suppose that
those who criticized the law's rapid approval were partly right given that
seven years later national policy would be changed to exactly the oppo-
site. Indeed, the 1984 law was stillborn.
Another polemical point was the transfer of technology. Many con-
gressmen argued that foreign firms did not transfer technology to the
Brazilian industrial sector. However, Luis Eulálio Vidigal, then president
of the Federation of Industries of the State of Sao Paulo (FIESP), sur-
prised the members of the commission when he replied that these firms
transferred not only product technology but also new methods of ad-
ministration, management, and production.
One can observe that another topic on the agenda—software—was
almost totally neglected in the final text of the law, probably due to
the fact that, at that time, influential actors were still betting heavily on
hardware's commercial success. Indeed, the law dealt with software in
only two topics, one of them affirming that provisions relating to soft-
ware would be the object of other more specific laws to be approved by
Congress subsequently. During the debates, however, many guest speak-
ers alerted the commission to the importance of software in coming
years. Software was already becoming valuable, but one has the impres-
sion that the urgency of passing a law relating to the market reserve for
the production of computers (i.e., hardware) in conjunction with the
short-term view of Brazilian industrialists relegated the attention that
should have been given to software to the sidelines. Like many other
speakers invited to testify before the mixed commission, Eduardo Guy
of ASSESPRO, during his discussion with congressmen, affirmed that
the issue of software was, in his words, "more important and strategic"
than hardware.*
Another point that should be highlighted is the repeated criticism
that the national informatics policy's protectionist measures could lead
to the country's technological isolation. This question, raised by Firmino
Freitas of the Brazilian Association of the Electric and Electronic
486 I&C/ Computer Technology in Brazil

Industry (ABINEE), did not seem to worry most members of Congress,

who were convinced that protecdonism was the best way of ensuring
that policy's success. It should also be observed that the concentradon of
powers in the executive branch and the Special Informatics Secretariat
(SEI), linking the policy direcdy to the president of the Republic, was
severely contested by various members of Congress.
Another aspect that had to be addressed by the informadcs bill was
human resources development and training. The discussions of this
theme led to the inclusion of a provision in the law mandadng the
creation of the Technological Center for Informadon Technology Foun-
dation, responsible for the development of research in this area and the
training of personnel.
Among the polemical issues discussed during the debates was the
definition of what in fact constitutes "informadcs acdvities," enunciated
in article 3 of the inidal bill. This point is crucial, as this definidon would
be used to establish the limits of the informadcs law and to classify an
activity as an informatics. Some representatives and senators quipped
that Estrela dolls that contained electronic circuits could benefit from
the law.' Undefined borders could potendally affect the telecommunica-
tions industry. This ambiguity created tensions with the MinCom, the
Telecommunicadons Ministry. At that dme there were still reasonably
well-defined differences between computers and other electronic de-
vices (e.g., telephones); pardcipants did not realize that the trend was
toward digital convergence.
Finally, besides the problem of defining what consdtuted informat-
ics activities, another issue appeared that was at least as, or even more,
controversial: Under which conditions should a firm be considered as a
national one for the purposes of the market reserve law? What should
be the configuration of a firm so as to be considered as a nadonal firm
for the purposes of the market reserve law? The law should state what
would be considered (what should count as) a national firm for the pur-
poses of the market reserve. For example, there were representatives
fighdng for the possibihty of allowing joint ventures, but the major-
ity understood that a firm consdtuted as a joint venture could not be
considered as a national one. What is at stake here is the opposidon be-
tween national firms and foreign firms. This discussion revolved around
the firm's shareholder composidon as well as shareholder vodng par-
dcipadon, the locadon of the firm's headquarters, and the possibility of
forming joint ventures, understood as a form of association between a
Brazilian and a foreign manufacturer to produce computers. Once the
latter were allowed (which in fact did not occur), the problem would
then be to specify the composidon of these joint ventures (i.e., the
 487

reladve stakes of the Brazilian and foreign firm), as well as how technol-
ogy would be transferred.
To conclude, the debates had some more heated moments, but in
general the impression was that adjustments were being made to an
inidal bill that was pracdcally stabilized by a broad alliance involving
the most different actors—the military, left-wing polidcians but also a
wing of the government's own party, the PDS, as well as the main op-
posidon party, the PMDB, industrialists, state company directors, trade
union leaders, academics, and technical leaders in the design and man-
ufacture of minicomputers.'" In sum, the group in favor of the reserve
constructed itself around the defense of the 1984 law, reaching far be-
yond the traditional sociological divisions into previously established
interests and groups, such as those determined by party alignments.
All the disputes referred to above—those between the MinCom and
the reserve's reach, between the powers of the SEI and the execudve
branch and those who defended a greater pardcipadon by Congress and
civil enddes associated with information technology, and those involving
the definition of what constituted a nadonal firm—escalated tensions
around the presentations convoked by the mixed commission. Despite
the heated debates, the law that was promulgated did not withstand the
changes that were to occur. In 1991, during the Collor government.
Congress passed a second informatics law (Law 8.248, promulgated on
October 23, 1991), abolishing the nadonahst pillars of the 1984 law.
The nationalist pillars were clearly revealed in minicomputer com-
mercials produced at that time in Brazil. Figures 1, 3, and 4 show the
explicit and direct texts and visual approach of the ads that accompa-
nied the launching of the Cobra 530 and 540 minicomputers produced
by Cobra Computadores, a company composed of private and predomi-
nantly state capital that was in the vanguard of the market reserve. In
figure 1, one can read that "a country that wants to be strong has to develop
its own information technology. The Cobra 530 is the first truly national
company capable of speedily resolving any data-processing problem. . . .
Cobra 530 is Cobra's response to the market reserve. It consdtutes the
development and consolidadon of national technology in a sector where
there can be no compromise: independence or death' (italics added).
This ad transmits the idea that nadonal strength and greatness are
associated with achieving mastery of information technology, but to cap
it all, its reference to independence could not be more patriodc and
eloquent: the words that conclude the ad, "independence or death,"
constitute a direct reference to the episode of the "Cry of the Ipiranga"
(made famous by Pedro Américo's 1888 paindng, reproduced in
figure 2), which, according to official history, was shouted on the banks
488 I&C/ Computer Technology in Brazil

Computador é como petróleo:

é perigoso depender dos outros.

Figure 1. "Computers are like oil: it is dangerous to depend on others." Revista

Veja, December 17, 1980.

of the Ipiranga stream (located where the city of Sao Paulo now stands)
by the prince regent, D. Pedro, thus marking Brazil's independence
from Portugal. The "registered trademark" of independence crossed a
century and a half to reappear triumphantly as a distinctive sign of na-
donal technology.
The ad shown in figure 3 cultivates the same nadonalist tone. It
begins with an extremely jingoisdc convocadon arousing the reader's
patriotic fervor, expressed in the suggestion to "puff out his chest." The
ad describes the Cobra 530: "Designed, developed and produced by
Brazilian technicians who work in a totally nadonal company, the Cobra
530 has the same quality as its foreign equivalents. And furthermore, as
it is produced by Brazilians, it is better fitted to our country's specific
data-processing needs. . . . As a Brazilian, you have many reasons to be
proud of the Cobra 530. . . . It represents the consolidadon of an indig-
enous, independent technology. It proves that we are also overcoming
challenges in the informatics field."
Once again, the adverdsement plays on the idea of technological
independence, a cause that, according to the text, will only achieve
Figure 2. The Cry of the Ipiranga hy Pedro Améríco (1888).

Estufe o peito e arregale os olhos:

o Brasil já faz computadores ágeis,
versáteis^poderosos.

;áeum Cobra Computadoras e

Sist^nss BrasH^ros S/A

Figure 3. "Puff out your chest and open your eyes wide: Brazil already makes ag-
ile, versatile, and powerful computers." Revista Veja, November 5, 1980.
490 I&C/ Computer Technology in Brazil

Figure 4. "Cobra 540—Brazil's computer." Revista Veja, August 3, 1983.

success if embraced by "our people" and whose benefits are enhanced

by the advantage that a computer produced in this way is "much better
fitted" to Brazilian needs than its imported equivalents. Thus, the neu-
trality and universality of the computer are rejected in favor of attaching
importance to the origin of its development. An object "made in Brazil"
is a better artifact than equivalent foreign products. The similarity is
framed as an element of comparison and affinity but never of identity
and equality. The place of development of the technology turns appar-
ent similarities into irretrievable differences, into incommensurability.
Figure 4 reads: "The Cobra 540 was planned here to solve our prob-
lems. This is why it deserves to be called Brazil's computer." The ad
insists on a direct relation between local development and local prob-
lems because the planning designed to "solve our problems" ensures the
superiority of the Brazilian solution. The conclusion that follows natu-
rally is that a computer that is developed in the country by Brazilians, a
computer "made in Brazil," would be the best solution for Brazil.
 491
Turning the Tables with the 1991 Law

In contrast to the 1984 informadcs law, the subsequent laws (1991,

2001, and 2004) did not involve the kind of intense congressional de-
bates (at least nothing significant was found in the National Congress
Gazette) that could give us an idea of the "environment and atmosphere"
that existed during their passage. On the contrary, the bill put to
Congress by the new president, Fernando Collor, became law in October
1991, leading one to suppose that its approval occurred under strong
pressure from the execudve branch, as in fact occurred with all informat-
ics laws. In the case of the 1991 law, it was the way the Collor government
found of opening up the market to foreign firms and thus finally put-
ting a stop to any nationalist ambidons. As liberalizadon of the market
had been taking place in other countries and protectionist policies were
facing universal criticism, the congressional debate seemed dispensable,
and the law was approved without problems. Just to give a reference, 261
amendments were presented during the passage of the 1984 law, com-
pared to a mere 51 in 1991. Moreover, during the passage of the former,
eighteen speakers from various areas (compudng, technology, univer-
sides, politicians) were invited to present their points of view to those
responsible for the bill's preparation (including, as already observed,
the presidendal candidates Tancredo Neves and Paulo Maluf).
The 1984 law was motivated by the idea of a "Great Brazil," the "de-
fense of national sovereignty through informadcs," and a "Strategic
Policy" with what was, to a certain extent, a nationalisdc and jingoisdc
appeal. The 1991 law, on the other hand, which abohshed the market
reserve, was characterized by its eminently economic approach. In line
with the neoliberal jargon of the dme, the law made explicit its aim not
to provide the basis for a national informatics policy but to encourage
"developing the capability and compeddveness of the informatics and
automadon sector." It thus consolidated one of the defining character-
istics of the Collor government, which was its determination to open up
the Brazilian market to imports. It was basically an andlaw, as both its
motives and its final text make clear that its aim was to overturn every-
thing that had been proposed by the previous law. The only thing that
remained in the new law was a vague concern to encourage scientific
research in the country, solely, however, by using tax incendves.
The promulgation of the 1991 law marked the definitive abandon-
ment of the protectionist and nationalisdc pretensions of the 1984 law.
The 1991 bill's exposition of motives contested the lack of an expira-
tion date that limited the competency of the SEI "to analyze and decide
492 I&C/ Computer Technology in Brazil

on projects for the development and producdon of informadcs goods"

(article 8, subsecdon 5, 1984 law). On this matter the second topic of
the exposition of motives observed that the current law "seeks to limit
the duradon of this competency to October 29, 1992, coinciding with
the period afforded to the SEI to manifest itself on imports of informat-
ics goods and services."
Árdele 17 completely revoked árdele 8 of the 1984 law, which dealt
with the SEI's competencies. A part of the 1991 bill aimed to limit the
final date for exercising these competencies to October 29, 1992, and
thus to control imports exercised by the SEI, as established by the sole
paragraph of árdele 14 of the 1991 law: "As from October 29, 1992 the
competencies of the Science and Technology Secretariat will cease as
regards analyses and decisions relating to projects for the development
and production of informadcs goods, as well as prior approval of im-
ports of informadcs goods and services."
Another "complaint" concerned the definidon of the specific con-
cept of national firm. The allegadon was that, as formulated in the 1984
law, the definition would hinder foreign investments in the country. The
new law's exposidon of motives (topics 3 and 4) instead proposed the
use of the concept of a national firm as defined in subsection 2 of article
171 of the Constitution. Indeed, this constituted the most controversial
point of the 1991 law, as this redefinition of the concept of a national
firm allowed foreign firms to enter the Brazilian market straight after
the end of the reserve, as established in article 1:

For the purpose of this law ... a Brazilian firm of nadonal capital is
considered to be a legal endty consdtuted and with its headquarters
in Brazil and that is effectively controlled and permanendy owned
direcdy or indirectly by natural persons domiciled and resident in
the country or by an endty consdtuted by Brazilian public law.
§ 1 The effective control of the firm is understood to be the
direct or indirect ownership of a minimum of 51% (fifty-one per-
cent) of the capital with effective vodng rights and the de facto and
de jure exercise of the decision-making power to manage its activi-
des, including those of a technological nature. . . .
§ 3 The shares with vodng rights or the right to fixed or mini-
mum dividends shall be nominadve .
§ 4 In the event of a domesdc partner losing the effective con-
trol of the firm that is enjoying the benefits established in this
law for Brazilian nadonal capital firms, the right to benefits is
 493
automadcally suspended without affecdng the reimbursement of
benefits that may have been unduly enjoyed.

Table 1 presents a comparadve table of the definitions of nadonal

firm, based on árdele 12 of Law 7.232/1984 and on árdele 1 of Law
8.248/1991. As can be observed from tbis table, the 1984 law stipulated
that the controlling shareholder was obliged to hold 100 percent of the
vodng capital and at least 70 percent of the nadonal capital. In the case
of the 1991 law, it was only necessary to have 51 percent of the voting
capital without any restricdons regarding the composition of the share
capital. Two amendments (numbers 43 and 45) were approved during
the passage of the 1991 law through the lower chamber. Amendment
number 43 revoked article 10 of the 1984 law because the latter es-
tablished that the execudve branch could regulate competition in the
informatics sector. The author of the amendment affirmed that specific
legislation already existed to deal with "the abuse of economic power
and the defense of competition." Amendment number 45 also deals
with the concentration of powers in the execudve branch, which, ac-
cording to article 9 of the 1984 law, would be free to regulate the process
of production and commercializadon of informatics goods and services
in order to protect the Brazilian market against foreign firms, thus fa-
voring the market reserve pohcy. Moreover, the period during which
control could be exercised was not defined, a situation that amendment
number 45 intended to correct.
In his jusdfication, the author of the amendment affirmed that the
regulation of the informatics market should be performed by the law
and not by the executive branch, because "letting Execudve acts estab-
lish such restrictions consdtutes a form of usurpadon of the powers that
are the domain of the law. Moreover, the nonestablishment of duration
periods for these restrictions is an affront to the Consdtudon, which de-
mands defined periods of time."
Thus, without any preoccupadon with the consequences of the mea-
sure for manufacturers, the market reserve was extinguished very rapidly
without a transidon period. According to Paulo Tigre, "In contrast with
Mexico, where the liberalization of the informadcs market in 1986 was
preceded by intense negodadons that resulted in important conces-
sions on the part of multinationals regarding exports, maximum levels
of prices in reladon to the internadonal market, and local investments
in R&D, . . . Brazil wasted the opportunity of obtaining a commitment
from new entrants to adopt practices that would be more beneficial for
the country than the mere impordng of electronics products.""
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 495
In sum, the 1991 law had two main aspects. The first was that it
was instituted to abolish the competencies of the SEI, open up the
Brazilian informatics market to foreign firms, and decree the end of
the market reserve. In her thesis, Simone Aparecida Costa mentions the
"infiltration" of foreign manufacturers in the Brazilian market in the
form of associations with national firms:

The end of the market reserve brought important world manu-

facturers such as Compaq, Acer, and Packard. The change
in the legislation allowed associations with foreign firms and
multinationals.

The second main aspect was the effort to galvanize research and de-
velopment in the Brazilian information technology sector through tax
incentives. The idea here was that, incentivized by exemption from
the industrial product tax (IPI), firms would invest in the R&D area,
whose investment percentages, as a proportion of gross turnover, were
specified in law.'^
Costa also observes that

Law 8.248/1991, approved by the Collor government, offered ex-

emption from the IPI for firms that manufactured their products
according to the basic production process (PPB) and invested in
research and development (R&D)." Of the 5 percent of gross turn-
over destined to R&D, 2 percent had to be invested in research
agreements with centers or research institutes or Brazilian educa-
tional entities. The law also allowed legal entities that invested in
the shares of Brazilian national capital firms that produced infor-
matics goods and services to deduct up to 1 percent from their
income tax.'*

The 5 percent of gross turnover invested in R&D activities would, in

principle, enable firms to continue investing in research. This was only a
poor imitation of what occurred in the market reserve, as it provided no
details as to under what circumstances foreign firms, with their research
centers consolidated abroad, would have an interest in performing this
kind of activity in Brazil.
Also according to Costa, figures from the "Study of the Impacts
and Results of the Tax Incentives Covered by Laws 8.248/1991 and
8.661/1993," published by the Ministry of Science and Technology in
1998, reveal that "between 1993 and 1998, the firms that took advan-
tage of these incentives paid R$4.7 billion in taxes. Exemptions granted
496 I&C/ Computer Technology in Brazil

under the Informadon Technology Law amounted to R$2.3 billion dur-

ing this period. Of this amount, R$2 billion were invested in research
between 1993 and 1998, with R$1.3 billion composed of these firms'
own research, R$606 million in agreements with educadonal and re-
search institudons, and R$77 million in programs developed by the
Ministry of Science and Technology."'^ 1

The 2001 Law: A Mere Continuation

The main reason for the promulgadon of the new informatics law,
10.176, in January 2001 was to maintain the tax incentives of the 1991
law. The new law was a mere condnuadon of the previous law.
Discussion of the law began in 1999, when the tax incentives provided
for in the 1991 law were set to expire at the end of the year. Due to pres-
sure from IT firms—most of them located in the state of Sao Paulo—a
bill was put before Congress (number 1700) in September 1999, extend-
ing tax incentives for another ten years. As it had still not been voted on
by October, great pressure was placed by the government of Sao Paulo,
a state that would be severely íiffected by the termination of these in-
cendves. The national government edited Provisional Measure 2037-23
during the same month, extending tax incentives."*
Congressional representatives from the state of Amazonas voted
against this provisional measure because they disagreed with the renewal
of the IPI exempdons for states outside the Manaus Free Trade Zone, ar-
guing that this hindered the competidveness of factories located in that
region." Taking advantage of the fact that the provisional measure had
been repromulgated several times, the state of Amazonas filed a direct
acdon of unconsdtudonality (ADI 2348). In December 2000 the federal
Supreme Court ruled in favor of Amazonas and terminated the tax ex-
emptions. At that time, these exempdons were no longer assured by the
force of law but by successive repromulgations of provisional measures.
There was the additional risk that firms would be forced to pay the taxes
they had not paid during the months the law was no longer in force.
According to tax lawyer Ives Gandra da Silva Martins, defense coun-
sel for the state of Amazonas, three points led the state to file a suit in
the federal Supreme Court. In an árdele published in the Folha de Sao
Paulo on December 17, 2000, Gandra da Silva Mardns highlighted the
arguments used. He points out that the provisional measure continued
to be extended at the end of each period, and its use could be consid-
ered abusive. In his words, the provisional measures could not be used
as a "customary way of legisladng."
 497

The Free Trade Zone's incendves, which in principle would only ex-
pire in 2013, would terminate in 2000, given that, with the informadcs
law, the number of investments in the state of Amazonas would decline
sharply because, according to the tax lawyer, a new law could not trans-
form Brazil into an enormous "free trade zone for informatics and other
technology products." Incendves were fine, but with an "advantage"
for Amazonia.
If investments in the Manaus Free Trade Zone declined, this would
weaken the economy of the state of Amazonas, hindering a greater
Brazilian presence in the Amazon, thus "excidng the interest of other
nadons in the area's universalizadon." According to Candra da Silva
Martins, the preservadon of the Free Trade Zone was the most perfect
transladon of national sovereignty in that region, because "thus we dis-
courage the 'greedy eyes' of other nations that are keen to intervene
due to wealth that awakens their undisguised covetousness." To jusdfy
this, he invoked his own personal testimony, alleging that at "a seminar
in Germany [he] saw the chief of staff of the US Army . . . [who] affirms
that the USA should be prepared to intervene in the Amazon if ever this
becomes necessary."
With the victory of the state of Amazonas in the Supreme Court, the
soludon to resolve the problem of tax benefits and guarantee invest-
ments in the sector by certain business groups, especially those from Sao
Paulo, was to approve a new informatics law with the utmost haste. To
speed up the discussion of the bill in Congress, Sao Paulo State's secre-
tary of science and technology, José Anibal, convinced the senators to
vote on a request for urgency. At the same dme, the federal government,
under great pressure from Sao Paulo, passed a decree that reduced IPI
rates for the informadcs sector to zero to ensure that already established
firms that had benefited from the 1991 law would not suffer any losses.
The consequence of this discussion was that, under pressure from busi-
ness and with the acdve support of the state of Sao Paulo, the 2001
informatics law was approved in only two months. There was only one
round of vodng in the lower chamber in a special session. Due to the
speed of the process, members of Congress were unable to examine the
issues involved more carefully.'^
In the middle of December 2000 the law was approved in the Senate,
with the overturning of the amendment that excluded cell phones
and video monitors from the category of informadcs goods. This went
against the protection of the Amazonas Free Trade Zone; however, ar-
ticle 10 of the new informadcs law assured that it would not apply "to
new informadcs goods projects in states or the Federal District whose
498 I&C/ Computer Technology in Brazil

firms in the two years immediately preceding the year prior to the ap-
proval of the projects had accounted for more than 50 percent of the
IPI tax incentives granted in the country." As this was particularly preva-
lent among Sao Paulo's firms, this restriction dealt a blow to the state's
ambitions to receive new undertakings attracted by tax benefits. Even
so, the restricdon was not debated—not only to avoid slowing down the
law's approval but also because the senators were (righdy) convinced
that the article would be vetoed by the president.'^
After earning approval in the lower house, the law was sancdoned
by President Fernando Henrique Cardoso in January 2001 with the ex-
pected veto of árdele 10.^" One of its novelties in reladon to the 1991
law was that it sought to establish better control over tax exemptions by
restricting investments to research institutions recognized by the gov-
ernment as well as seeking to assure research funds for universides of
the northern, northeastern, and midwestern regions.^' Another unusual
aspect of the law was the gradual reduction of tax incendves, according
to article 1, which reformulated article 4 of the previous law:
Art. 4. Firms that develop and produce informatics and automadon
goods and services and which invest in information technology re-
search and development will qualify for the benefits covered by
Law number 8.191, ofjune 11, 1991.
§ 1 A. The benefit of exemption extends to December 31, 2000,
and as from this date shall be converted into a reducdon of the
industrial product tax, observing the following percentages:
I—reduction of 95 percent in income tax due, from January 1 to
December 31, 2001;
II—reduction of 90 percent in income tax due, from January 1 to
December 31, 2002;
III—reduction of 85 percent in income tax due, from January 1 to
December 31, 2003;
IV—reducdon of 80 percent in income tax due, from January 1 to
December 31, 2004;
V—reduction of 75 percent in income tax due, from January 1 to
December 31, 2005;
VI—reduction of 70 percent in income tax due, from January 1,
2006 to December 31, 2009, when it will be extinguished.
 499
During the year that the 2001 law was approved. President Cardoso
even vociferated that "this sector [that produces informatics goods]
must correspond to this incentive. . . . We hate the wrong use of incen-
tives. We are going to make a more thorough evaluation. "^^ In other
words, in theory, the new law would make harder demands on firms re-
garding their investments in research and development. Unfortunately,
despite the president's tough and threatening tone, this was far from
what actually happened, as we shall see below.
The problem with the tax incentive policy provided for in the 1991
law lay in the fact that many firms exploited the law's lack of clarity
regarding what constituted "research activities" and the lack of supervi-
sion by the public authorities to get around the law. They created a work
environment to develop research that did not aim at developing tech-
nology, or they created new projects inside the firm that appeared to be
developing new technology. According to the newspaper Valor Económico,
"according to ministry calculations, . . . 52 firms have accumulated a
debt of R$ 501 milHon [approximately US$200 million at the prevail-
ing exchange rate] over the past eight years related to investments that
were not undertaken. There are situations in which they spent less than
the law mandated and more complicated cases in which the expendi-
tures presented byfirmswere not recognized as investments in research
and development by the government."^' Also according to the article,
the then secretary of informatics policy at the Ministry of Science and
Technology, Marcelo Lopes, toughened his stance and affirmed that "it
was time to put a stop to that litde game in which firms pretended to do
research and the ministry pretended to demand results."
After the scandal, mechanisms to control what qualified as a research
and/or development activity in informatics were proposed, such as the
number of patents registered by firms and the publication of scientific
articles. Nevertheless, firms alleged that they could not fulfill this type of
requirement because it was specific to academia.^*
In summary, the 2001 law simply preserved the objectives proposed
by the 1991 law: keep import tariffs low and use tax exemptions (in the
states outside the Manaus Eree Trade Zone) to encourage technological
research and development on the part of firms. Like the 1991 law, the
2001 law differs from the 1984 law in its strong bias in favor of import
liberalization due to the same neoliberal perspective that prevailed dur-
ing the 1990s. The 2001 law was basically the same as the one approved
in 1991 with some adjustments, and thus, in relation to the 1984 law, it is
also an andlaw.
500 l8cC/Computer Technology in Brazil

The 2004 Law: An Exchange of Favors

The new informatics law. Law 11.077, of December 30, 2004, was also
approved in order to extend the tax benefits for another ten years. As
they were in the previous iterations of the law, the firms benefiting from
tax exemptions had to invest part of their gross turnover (5 percent) in
research and development, and the deduction of IPI would gradually
be reduced. So far, no surprises. What differentiated the 2001 and 2004
laws was the scenario in which they were approved. The latter was ap-
proved as part of tax reforms proposed by President Luis Inácio Lula da
Silva upon taking office in 2003.
One of his campaign promises had been to extend the benefits
granted to the Manaus Free Trade Zone. After his election, the "debt"
incurred with the state of Amazonas was settied through a constitutional
amendment (EC 42) that proposed the tax reform, extending those
benefits until 2023.
The Party of Brazilian Social Democracy (PSDB), the hegemonic
party of the previous government of President Fernando Henrique
Cardoso, has its origins and main electoral base in the state of Sao
Paulo. The party took advantage of the opportunity to bargain its sup-
port for the tax reform in exchange for the extension of the tax benefits
provided for in the informatics law, arguing that as the benefits granted
to the Manaus Free Trade Zone would be extended for another ten
years, the benefits for IT firms located in other regions should also last
another ten years. Thus, the PSDB managed to assure that article 5 of
the EC 42 would make the executive branch send a bill on an urgent
basis, thus heeding the PSDB's requests: "The Executive Branch in up
to sixty days after the promulgation of this Amendment shall put a bill
of law to Congress, under the regime of constitutional urgency, which
will regulate the tax benefits for the capacity building of the informa-
tion technology sector, which will last until 2019 under the conditions in
force when this Amendment is approved."
When it arrived in Congress the new informatics law gave the mem-
bers of Congress from the state of Amazonas no choice but to approve it.
Unlike what had happened in 2001, representatives from Amazonas did
not contest any aspect of the bill, and the 2004 informatics law passed
"smoothly" through Congress.
Conclusion
Even though the questions formulated at the beginning of this article
remain without more detailed answers, I ask for the reader's tolerance
 501
and understanding, given that my research is still ongoing. However, it
is already possible to give some tentadve conclusions, which are briefly
presented here.
First, the 1984 law translated a desire for a greater local mastery of
informadon technologies, understanding this to be a question of na-
tional sovereignty. In order to achieve this goal its proposals articulated
domesdc policies toward industry, the economy, education, and science
and technology. In other words, the 1984 informatics law sought to es-
tablish a national informatics policy committed to the production of
local knowledge, nurturing (and nurtured by) a market for Brazilian
industry and engineering. Its definidon of what constituted a Brazihan
firm aimed clearly at disdnguishing the mere assembly of equipment in
Brazilian territory, conceived and designed in foreign research centers,
from its effecdve conception (and not just manufacture) by Brazilians.
Paying scant attention to software and the emergence of the novelty of
microcomputers, its intendon was to legally formalize the market re-
serve for the producdon of minicomputers that had been in operation
since 1976, providing it with a legal foundadon and thus assuring its
durability. Created to consolidate the inauguration of a new epoch, it
functioned paradoxically as a harbinger of its demise.
Second, the 1991 law was sanctioned precisely to implode the previ-
ous law, and for this reason I referred to it as an antilaw. Whereas the
1984 law had established a nadonal informatics policy, the 1991 version
sought to reduce this vast scope to a focus on stricdy economic consid-
erations, in tune with the neoliberal rhetoric in vogfue at that dme, with
its concern, as expressed in its text, with "capacity building and the com-
peddveness of the informatics and automadon sector." The policy of
research and development in informatics was reduced to the mere pro-
vision of tax exempdons, so handing the policy to the market. Brazilian
firms no longer occupied the market exclusively, as the law abolished
the market reserve and allowed the entry of foreign firms.
Third, the 2001 law represents the reconciliadon of a dispute involv-
ing federal issues between the states of Amazonas and Sao Paulo (and
some other states of the southern and southeastern regions) regarding
the distribudon of tax incentives for the manufacturing of informadcs
goods. Thus it involved the mere extension of the duradon of the tax
incentives offered by the 1991 law, that is, a repromulgadon of the 1991
law, mainly in favor of the state of Sao Paulo's industry. While it was in
force it was possible to observe some of the forms adopted by the mar-
ket to conduct research and development activides using tax incentives,
which included the blatant simuladon of these acdvides.
502 I&C/ Computer Technology in Brazil

Finally, the 2004 law was also marked by the remnants of the insdtu-
donal issues involving the federadon mobilized by the 2001 law, which
this time around involved the political negotiadons undertaken to ap-
prove the first Lula government's tax reform. In sum, it constituted a
repromulgadon, without noveldes, of the 1991 law.
We could conclude that the laws of 1991, 2001, and 2004 bore lit-
de or no relation to a national informadcs policy in a wider sense and
that the 1984 law, apparently and literally committed to such a policy,
served as that policy's epitaph. The impression I have, which is still
to be confirmed by the condnuation of the present research, is that
Brazil has not yet had a law that estabUshed not only de jure but also
de facto a nadonal informadcs policy.^' This conclusion may be a little
too harsh, given the results collected so far, but it certainly seems that
all this legislative busde, concentrated in only t^vo decades, has failed
to produce better-negotiated proposals that could allow us to envision a
more long-term trajectory for Brazilian informadcs. In its place we are
left with the erradc trajectory produced by jolts, sudden swerves, and
last-minute turn-abouts, each the result of a set of unsustainable choices,
whether those choices are due to the problems encountered while
garnering support and allies or to the seducdon of excepdonal circum-
stances or pardcularist demands. If we frame the problem in terms of
the existence of groups or andgroups mobilized by the formuladon of a
nadonal informatics policy, we can affirm that its formadon condnues to
be extremely precarious and unstable.
Placed alongside each other, as I have done here, these four laws
show us that there is much more to research and learn beyond the di-
chotomy that has for a long dme imprisoned the discussion in Brazil.
Intoning their andprotectionist mantras, the opponents of the market
reserve, usually entrenched in the main newspapers and magazines,
have never lost the opportunity to see the experience of the reserve, as
conceived in the 1984 law, as one of Brazil's great policy errors.^''
Indeed, the market reserve, whatever its experiences or attempts, re-
mains to this day an anathema for the always fierce and unconditional
defenders of the free market. Any sign of a protecdonist policy sets the
alarm bells ringing, as in the example of the presdgious and conservadve
magazine Fpoca, which in Januar)' 2012 published an árdele symptom-
adcally endded "Bye-bye, Liberalizadon," with the no less symptomadc
subdde: "By adopdng a series of protecdonist measures, the [current]
president, Dilma Rousseff, is restoring the old market reserve for
domesdc industry."" The article itself is adamant about expressing dis-
approval of any measure that hints at protecdonism: "Dilma is restoring
 503
the old (and inefficient) policy of a market reserve, of the business car-
tels, and the undiscriminadng protection of domestic industry." If it was
in opposition to any form of market protecdon that the 1991, 2001, and
2004 laws—in reality three versions of a single law—^were promulgated,
their effects on the Brazilian informatics sector have been negligible to
this day. Classifying this struggle as one between "protectionists" and
"liberalizers" or, adopting more ideological terms, between "leftwing"
and "rightwing" groups is excessively panoramic and prevents us from
appreciadng the details, nuances, and subdeties that must necessarily
support the quest for a more robust and consistent informatics policy
for the country.

Notes
I would like to thank Luiz Augusto da Silva Alves and Rachel Gonçalves de
Castro, undergraduate students in Computer and Information Engineering at
the Escola Politécnica/UFRJ (Polytechnic School/Federal University of Rio
de Janeiro), for their valuable assistance, made possible by scientific initiation
scholarships provided by the National Agency for Scientific and Technological
Development (CNPq). I also wish to extend my thanks to the Humboldt
Foundation for the research grant that enabled me to stay for three months at
the Deutsches Museum and another three months at Konstanz University, where
I was able to plant the first seeds of the present research with the important
support of Ulf Hashagen and Karin Knorr Cetina, to whom I am also grateful.
A Portuguese preliminary and reduced version of this article was presented to
the II Symposium on the History of Informatics in Latin America and Caribe
(II SHL\LC), held in Medellm, Colombia, in October 2012, together with the
Thirty-Eighth Latin American Conference in Informatics.
1. B. Latour, Reassembling the Social: An Introduction to Actor-Network Theory
(Oxford: Oxford University Press, 2005), 28-35.
2. Ibid., 34.
3. L. Perrone-Moisés, Vira e mexe, nacionalismo—Paradoxos do nacionalismo
literario (Sao Paulo: Companhia das Letras, 2007), 27.
4.J. N. Vardalas, The Computer Revolution in Canada: Building National Techno-
logical Competence (Cambridge, MA: MIT Press, 2001), 1.
5. For the reasons why the market reserve for microcomputers was per-
formed as a mere extension of the minicomputers' market reserve without
any reframing, see Ivan da Costa Marques, "Minicomputadores brasileiros nos
anos 1970: Uma reserva de mercado democrática em meio ao autoritarismo,"
Historia, Ciencias, Saúde-Manguinhos 10, no. 2 (May-August 2003): 657-681. It
is worthwhile to mention that, also in 1984, an important renewal of the PC
market was promoted by Apple when it launched (in January) the Macintosh, its
new personal computer model that introduced the novelty of graphic interface,
thus enormously facilitating further lay and domestic use and so producing a
definitively bad scenario for the future survival of minicomputer technology.
504 ï8cC/Computer Technology in Brazil
6. Cora Rónai's blog, entitled "internETC," at http://cronai.wordpress
.com/2012/ll/lO/bodas-de-prata/.
7. Ivan da Costa Marques, "Minicomputadores brasileiros nos anos 1970:
Uma reserva de mercado democrática em meio ao autoritarismo," Historia,
Ciencias, Saúde-Manguinhos 10, no. 2 (May-August 2003): 679. The micro-
computers referred to here were in fact a type of minicomputer and not what we
nowadays know as a PC.
8. The division between hardware and software, in which one is "opposed"
to the other, in which one seems to refer to issues that are distinct and not
concurrent with those of the other, is still commonly used, especially in discus-
sions of the future course of national informatics policies. Such an opposition
is hardly productive, as it is impossible to conceive of hardware and software as
polar opposites. This discussion is, however, beyond the scope of the present
article. j
9. Estrela is a traditional Brazilian toy manufacturer.
10. According to actor-network theory (see the work of authors such as Bruno
Latour, Michel Callón, and John Law), nonhumans also act and are thus actors.
11. P. B. Tigre, "Liberalizaçào e capacitaçào tecnológica: O caso da infor-
mática pós-reserva de mercado no Brasil" (Instituto de Economia Industrial,
Universidade Federal do Rio de Janeiro, 1993), 3.
12. S. A. Costa, "Sobre-representaçâo e intéresses regionais: O caso da lei de
informática" (master's thesis, Universidade de Sao Paulo, 2007), 16. The indus-
trial product tax (IPI) is a federal tax on industrial products in Brazil provided
for in article 153, section 4, of the federal Constitution. Tax rates vary according
to the product. Certain products are exempt, whereas others are subject to a
rate of more than 300 percent (e.g., cigarettes). In order to encourage the con-
sumption of a product, the government may exempt it from IPI or reduce the
rate significantly. Inversely, products whose consumption the government wishes
to restrict (e.g., cigarettes, alcoholic beverages, and luxury products) are taxed
at extremely high rates. As IPI rates are established by the executive branch, the
tax is used by the federal government as a tool of policy.
13. The Basic Productive Process (Processo Produtivo Básico, PPB) was
defined by Public Law 8.387 of December 30, 1991, as "the basic set of opera-
tions in an industrial plant that characterize the effective industrial processing
of a certain product." The PPB was only regulated in 1993 and was "a way of
ensuring the domestic implementation of stages of the production process," ac-
cording to R. Garcia andj. E. Roselino, "Uma avaliaçâo da lei de informática e
de seus resultados como instrumento indutor de desenvolvimento tecnológico
e industrial" (Escola Politécnica da USP e Instituto de Economia, UNICAMP,
2004), 2. However, it was not effective in guaranteeing Brazilian development.
14. Costa, "Sobre-representaçào," 10.
15. Ibid., 16. It is difficult to convert these amounts into dollars because the
exchange rate varied considerably over this period, especially in 1993 and 1994.
However, from 1995 to 1998 the real could be converted to the dollar on close
to a one-to-one basis.
16. According to Bandeira de Mello, provisional measures (MP) are "mea-
sures (as the name itself says, provisional) that the President of the Republic
may adopt 'in important and urgent cases' and will have the 'force of law.'
Their effectiveness, however, will be eliminated from the ver)' beginning if the
 505
National Congress, to which they will be immediately submitted, does not con-
vert them into law in at most 120 days after their publication" (http://jus.com
.br/revista/texto/6164/medidas-provisorias-e-materia-tributaria/2).
17. Folha de Sao Paulo, December 7, 2000. The Manaus Free Trade Zone
(Zona Franca de Manaus, ZFM), located in the Amazon region in the north of
the country, was created by the federal government in 1967 in order to stimu-
late the economic development of the western Amazon. Administered by the
Superintendency of the Manaus Free Trade Zone (SUFRAMA), the industrial
pole currently (2012) harbors around six hundred factories, concentrated espe-
cially in the television, IT, and motorcycle sectors. In recent years the pole has
received a fresh stimulus with the tax incentives granted for the development of
digital TV technology in Brazil. In 2012 President Dilma Rousseff announced
that the duration of the free trade zone would be extended for another fifty
years (http://pt.wikipedia.org/wiki/Zona_Franca_de_Manaus).
18. Folha de Sao Paulo, December 9, 13, 14, 2000.
19. Costa, "Sobre-representaçâo."
20. The approval and then the veto of article 10 by the president of
the Republic did not end the conflict between the politicians of the state of
Amazonas and their colleagues. The decision would lie in the hands of the
federal Supreme Court, given that the members of Congress for the state of
Amazonas alleged that the informatics law offered benefits to other states that,
according to the Constitution, should be granted only to the Manaus Free Trade
Zone. According to the editorial "Opportune Veto," published in the Folha de
Sao Paulo on Januaiy 12, 2001, a newspaper that manifestly supported the state
of Sao Paulo's interests, it would be absurd to make new investments in the
country completely unviable.
21. Folha de Sao Pawfo, Januar)' 10, 2001.
22. Folha de Sao Paw/o, January 12, 2001.
23. R. Balthazar, "MCT cobra os investimentos em pesquisa e desenvolvi-
mento de 52 empresas beneficiadas pela Lei de Informática," Valor Económico,
June 27, 2005.
24. Since 2011 I have been seeking more information about the accusa-
tions (made by the government itself) filed with the Controller General of the
Union and the Ministry of Science Technology and Innovation (MCTI). I only
managed to establish contacts with the MCTI in July 2012, but more detailed
research in its archives will be needed to locate the necessary documents.
25. Generally speaking, this research will involve two steps: expanding the
bibliographical references and the press sources to be consulted; and conduct-
ing interviews with members of Congress and authorities linked to the process
that led to the promulgation of each of these laws.
26. A vigorous questioning of the affirmation that this reserve was a great
mistake can be found in the previously quoted Cora Rónai's blog, in which the
author also makes a great effort to produce a sociotechnical perspective on the
experience of the reserve.
27. The article refers to measures relating to various industrial sectors such as
cars, toys, and bicycles.
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