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Public Affairs - Monthly Newsletter | June 2018

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The Newsletter of June has as focus the October elections, and brings an analysis of Henrique Meirelles as a possible next president of Brazil. Furthermore, we highlight themes related to female candidature, new rules for electoral ads on internet and the electoral race in 5 Brazilian state. Lastly, we approach also the political stalemate in the National Congress to approve the Legal Landmark of Personal Data.

In order to provide a further discussion tool, the Public Affairs team wishes a great reading!

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Public Affairs - Monthly Newsletter | June 2018

  1. 1. Monthly Newsletter Burson-Marsteller May Public Affairs 2018
  2. 2. Burson-Marsteller l Public Affairs An intersecting agency that, through the understanding of the political environment, assists clients of different sectors in the protection and/or promotion of their businesses, managing their influence in a sustainable way. The Burson-Marsteller standard is responsible for the development of highly customized projects, according to the needs of each client, developing strategies for various economic sectors, especially those heavily regulated by the government. Index Year 2 | Nº 06 | June Colaboradores desta edição Luciana Lemgruber Andressa Mont’Alvão Isabela Girotto Anna Paula Losi Nara Andrade 02 Elections | Electoral Propaganda on the Internet: New Rules for 2018 03 Elections | Henrique Meirelles: an economic turnaround leads to the presidency? 04 Elections | Women in Brazilian Elections 05 Elections | Overview of the State Executive Elections in 2018: the race in São Paulo, Minas Gerais, Bahia, Pará and Paraná 09 Politics | The legislative race for changing the law of data 11 Economic Data 12 Events Calendar Mikael Victor Leonardo Brito Renata d’Aguiar Fernanda Xavier
  3. 3. The 2018 elections will be designed by digital marketing. Online advertising fills the shortage of resources that came from the prohibition of donation from legal entities. Changes in electoral rules force politicians to invest in new strategies. The electoral use of the Internet must be proved as tangible as the leaflets and rallies. The rules seek to follow a more connected society with greater access to information. The Law 13 488/17 requires the publication of how much was spent on the internet campaign. However, it does not demand the application providers (including digital giants such as Facebook, Google, Youtube and Twitter) to report irregularities or inconsistencies. The reach potential will be, in this sense, marked by the economic power of the politician and the concentration of content on foreign platforms. Specifically directed postings will be a decisive campaign tool, since it will be possible to identify specific profiles of voters and potential voting bases. By popularizing politics, social networks take voters closer to the candidate, as well as present a key element: interactivity. Communication ceases to be static and, now, it needs to be constantly updated. A small electoral reform in 2017 authorizes the boost of posts, as long as they are identified as sponsored. Focusing on results is not prohibited, but the tool must be used exclusively by parties, coalitions or candidates. However, inserting or boosting an advertising content on the date of the election is prohibited, as well as the use of fake profiles and robots. Another requirement is that hired application providers must have a legal representative established in the country. The challenges are presented along with the technology: the possibility of data leak and manipulation. In Brazil, the sharing of fake news is far from a consensus. In the Chamber of Deputies, the main project (PL 6812/17) is still in the first commission, under the report of former Minister of Science and Technology, Deputy Celso Pansera (PT/RJ). The proposal criminalizes the dissemination of damage or incomplete information on the internet. Other proposals - including this one - related to fake news are rejected by civil society entities that defend freedom of expression. It will already be a rule in this year's elections to prohibit the boost to change the content or the repercussion of advertising. The Internet application provider will take responsibility for not making unavailable a content that is found to be infringing by the Electoral Court, respecting the technical limits of the service. The link of the removal to the judicial order makes the authorities responsible for filtering what may be injurious to a candidacy. Electoral propaganda, including on the internet (unpaid), may begin on August 16 in Brazil. What the Electoral Law has not answered yet is whether the migration of the campaigns to the online environment will reflect a democratic and transparent political space. Andressa Mont’Alvão Elections Electoral advertising on the internet: New rules for 2018 02
  4. 4. The lack of political representativeness, the "protest" vote, the "no vote" and exclusion vote are increasingly present in any debate on the upcoming elections in Brazil. In this scenario, resulting from the current political and economic crisis in which the country has been inserted for months, former Finance Minister Henrique Meirelles was perceived in the first moment as a viable possibility to occupy the position of President of Brazil. Born in the state of Goiás, nephew and grandson of politicians, Meirelles holds a degree in Business Administration from Harvard University and has built a consolidated career in the corporate environment, reaching BankBoston's World Presidency. In the 2000s, in fact, he had started his political life when joined the PSDB. As the head of the Central Bank, he was recognized, both by the business community and the citizens, for his actions that aimed to leverage the Brazilian economy, which was also perceptible as Minister of Finance. Pre-candidate for the MDB, Meirelles faces difficulties not only in the party, but also with the electorate. In this context, with just over 1% of the voting intentions in the polls, the former Minister has not yet convinced his party that he is the best option as a presidential candidate and has tried to unlink his name from the "governmental candidate", following the withdrawal of Michel Temer to re-election. Supported by the current President of Brazil, Meirelles has sought to get closer to the parliamentarians of his current party, but probably in the National Convention, he will have opponents like the Senator Roberto Requião (MDB / MG), nominated by Renan Calheiros (MDB / AL), to compete for the Planalto Palace. Still on the challenges, the pre-candidate, given his unpopularity, has already presented a flexible discourse in relation to social programs, regarding the inclusion of attention in the social area and praised programs such as Bolsa Familia. However, the most opposition and, to some extent, unexpected, comes from the entrepreneurs and investors. Contradictorily, the work of Meirelles for the economic turnaround made the biggest enthusiasts of his candidacy, now, pressured him to give up to run for the elections. This is justified by the fact that, after leaving the Ministry of Finance, the economy has presented losses, such as the significant increase in the dollar. In this scenario, Meirelles and his challenges are further encouraging the unpredictability of these upcoming elections in which the future of the country, despite the short time until October, seems to be increasingly uncertain. Isabela Girotto Elections Henrique Meirelles: Does Economic Turnaround Lead to Presidency? 03
  5. 5. In 2018, Brazil will hold its 31st general election – direct and indirect elections considered – since the proclamation of the Republic in 1889, and the participation of women in Brazilian politics is still weak. The level of female participation in the public sphere has grown with each election, but it is still far from ideal. The vote only became a national right in 1932, but it was only mandatory for literate men up to 60 years old. Although theoretically women could already vote, in practice, women could only vote if it was the will of their fathers or husbands. It was only in 1965 that the Electoral Code equalized the electoral rights and obligations of men and women. The first woman was elected in Brazil when women still could not vote. Luíza Alzira Soriano was elected mayor of the city of Lajes, in Rio Grande do Norte state in 1928 with 60% of the votes. Sadly, that didn’t last long. She lost office only seven months later once she did not agree with the Getúlio Vargas administration. The first female federal representative was elected in 1934. Doctor Carlota Pereira was elected by the state of São Paulo and was part in the Constituent Assembly that put an end to the 1889 Constitution of the Old Republic. The first female Senator was Eunice Michiles, who was nominated to the position in 1979 after the death of João Bosco. Roseana Sarney was the first female governor, elected in 1994, in the state of Maranhão. And, finally, the first woman elected President of the Republic, in 2010, was Dilma Rousseff (who also became the first woman reelected, in 2014, and the first female president to be impeached in 2016). The Electoral Justice announced that by February 2018, 52% of the Brazilian electorate was composed of women, making up the figure of 77,076,395 eligible voters. However, statistics show that this number is disproportionate to the number of women occupying political positions in the country. In 1997, the quota system is established determining that parties must enroll at least 30% of women in proportional ticket. In 2009, the Electoral Reform, in addition to obliging parties to register at least 30% of women, also required that at least 5% of the resources of the Party Fund be used to encourage female participation in politics and that 10% of party’s share of free advertisement time (bought by the Electoral Justice in TV and radio) should be devoted to them. Nevertheless, changes in electoral rules did not cause the expected impact. Only in 2012, female candidates reached 30% of the total number of applications in the country, and, in the 2014 elections, only 29% of all eligible candidates were women. For the Presidency, they were 37%, with 3 female candidates running. For the Federal Legislative (House of Representatives and Senate), 29% of the candidates for the titular positions were women. The numbers were worse at the state level: for executive positions, female participation was only 11%, while for the Legislative the proportion was also 29%. Elections Women in Brazilian Election 04
  6. 6. When the numbers of the elected officials are analyzed, the disparities are only accentuated. In a total of 1,709 candidates elected at both the federal and state levels, only 190 were women, reaching only 11% of the occupied positions – including the Presidency of the Republic. The proportions are even smaller among the governors, where only 1 woman was elected (3%), and in the Legislative both Federal (10%) and State (11%). Furthermore, a major problem was identified in the municipal elections of 2016. With the requirement of the minimum quota for women registration, the issue of the candidates registered "just for the record" emerged. In these election, approximately 16,000 candidates did not receive even one vote. Of these, 14,417 (more than 90%) were women who did not even vote for themselves. The fact led the Public Prosecutor's Office to open investigations to determine the responsibilities, which found out that many of these candidates did not even know they were running. In 2018, the expectation is of a greater awareness of the importance of female participation in both the electoral race and the final outcomes. Election officials hope that the law will be enforced on a more regular basis, that the parties encourage women to be more participant as candidates in their committees and that financial resources will be more effectively employed in women's campaigns. Renata d’Aguiar Elections 05 2018 BRAZILIAN GUBERNATORIAL ELECTIONS PANORAMA The race in São Paulo, Minas Gerais, Bahia, Pará and Paraná States With only a month remaining until the opening of the official parties’ convention season, the 2018 elections landscape is beginning to be more clearly defined in many states. And although they sometimes lose space on the national agenda, these disputes carry great potential since it is at the state level where a series of important public policy decision making are under way, many of which have a direct impact on the lives of Brazilians. In Minas Gerais state, the scenario of the dispute is sketched amid allegations of corruption that have plagued the two major political parties: the Workers’ Party (PT) and the Brazilian Social Democracy Party (PSDB). Such parties have already established their pre-candidates and should lead the electoral race once more. Nevertheless, other parties are articulating to present alternatives to the polarization of Petistas (supporters of the PT) and Tucanos (supporters of the PSDB) in Minas Gerais.
  7. 7. Elections 06 In the state, the ballot for governor seems set to have at least 8 candidates, but the opinion polls point out 3 main players in the scenarios polled: (a) Senator Antônio Anastasia (PSDB), with 25.9% of voting intention, is highlighted as the main force of the opposition to the current state government and leads all explored scenarios; (b) Fernando Pimentel (PT), currently governor of the state, is expected to run for reelection and polls at 19.9%, according to a survey commissioned by the Paraná Institute; (c) and, finally, Marcio Lacerda (PSB) appears as an alternative to the polarization between PT and PSDB, despite the low placement in the polls, reaching just about 11.3% of voting intention’s share. Looking at the prospects in São Paulo, the already notorious, Dória and Skaf lead the electoral race. The last Ibope survey shows that the former mayor of the city of São Paulo (the state’s capital city and namesake), João Dória (PSDB), and the president of the State of São Paulo Industries’ Federation, Paulo Skaf (MDB), compete strongly for the state voters: Dória leads with 22% of voting intentions, compared to 15% for Skaf - the margin of error considered is of 3%. It’s been considered that the dispute between Doria and Skaf will get even fiercer in an eventual second round, where both reach 32% of the voting intentions. Other candidates such as the Petista, Luiz Marinho, and the current state governor, Márcio França (PSB), are far behind in the survey, reaching 4% and 3% respectively. In Pará, which, like São Paulo, had the last 25 years of state elections dominated by the PSDB (the Tucanos won 5 of the last 6 elections in Pará and 6 of 6 in the Southeastern state), the state just bid goodbye to Governor Simão Jatene, who, after his third term, can no longer be re- elected. The veteran politician has already declared support for state’s Legislative Assembly Speaker, Márcio Miranda (DEM)’s candidacy, but the absolute leader in the polls is former National Integration Minister of the Temer administration, Helder Barbalho (MDB). Son of former governor, Jader Barbalho (1983-1987 and 1991-1994), and candidate in 2014 (when he lost to Jatene in the second round), the former minister appears as the undisputed frontrunner in several polls (always reaching more than 30% in voting intentions), followed by Márcio Miranda (DEM) and Senator Paulo Rocha (PT), that reach 13.8% and 7.8%, respectively, in a February survey by DOXA. In the south, the race for the Iguaçu Palace (Paraná’s Governor seat) seems much more detached from its Tucano past. Former governor Beto Richa (PSDB) stepped down from office in March 2018, within the deadline of disincompatibility which enabled him to run for the Senate, and has already shown support for current governor, Cida Boghetti (PP), with whom he composed the 2014 elections ticket. The former federal deputy (and wife of former Health Minister Ricardo Barros), however, appears in the bottom of the polls, behind the leaders Ratinho Jr. (PSD), son of a popular TV show host and former state secretary of the Richa administration, and Osmar Dias (PDT), former senator and brother of pre-candidate to the Presidency of the Republic, Álvaro Dias. Both appear in a technical draw with 34% and 28% of the Ibope April poll (the margin of error is 3%). The current senator and former governor, Roberto Requião, also appears competitive in spontaneous polls, but according to press reports, he has reached an agreement with Osmar Dias and is expected to run for re-election to his Senate seat.
  8. 8. Elections 07 In the race in Bahia, on the other hand, the trend is of continuity given the undeniable leadership of the candidate running for re-election, Rui Costa Pimenta (PT). The governor has high approval ratings and polls close to 50% of the P&A Institute's May 28 poll intentions. Furthermore, the PT candidate was favored by the mayor of Salvador (the state’s capital city), ACM Neto (DEM), who still gets some 3.2% in spontaneous polling (against 19% of the governor), but decided not to run earlier this year in favor of the former mayor of Feira de Santana, José Ronaldo (also from the Democrats, a right-wing party, and, today, scoring at 6.5% against the 47.9% of the Petista candidate, in a 3% margin of error poll). According to the deadlines set by the Superior Electoral Court (TSE), parties must hold conventions to define their candidates for the 2018 elections between July 20 and August 5. Once they’re done with conventions, applications must be sent to the Electoral Court by August 15 so they can be judged by September 17. The period set for electoral propaganda begins at August 16. Leonardo Brito e Mikael Victor
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  10. 10. The availability and collection of personal data has changed a lot in recent times. Likewise, the protection of privacy and data increasingly becomes more important. Thus, living in society and the protection of law is constantly challenged by these new issues that are proving current and effective in the information society. Data protection was one of the most talked subjects in the first half of 2018, stimulated by the validity of the EU General Data Protection Regulation (GDPR). In Brazil, some bills on the subject are under discussion, two of the most important are PLS 330 (proposed by the Senate) and PLC 53 (proposed by the Chamber of Representatives). Both are inspired by European regulations, and inaugurate a new phase of legal protection for personal data in the country, moving away from our current model of sectoral and specific regulations. A new to be introduced by the general law will be the differentiation between agents who process personal data. As in the European Law, the idea is that there is a differentiation between who is responsible for data processing and who is the "operator" that performs such treatment. Those distinctions will be relevant at the time of determining the responsibilities against the damage caused to the data subject. Another point is that the entry of GDPR, as it should be, has brought a great deal of discussion about the rules related to international data transfer, a reality of the current, globalized and connected world. This normative tendency is also followed by bills under way in Brazil. It is also important to mention that both projects bring a list of sanctions to be applied to those who violate the terms of the future law. Faced with an enormous amount of criticism of the impunity and power of the big credit companies, it is necessary that abusive and unhygienic practice be treated as criminals. In the Legislative Power, while the formal objective of the normative change is the security of the population and its information, the practice that has been happening is a political ego dispute between Government and opposition and between Representatives and Senators. The government urgently approves the bill that creates the Positive Register, a mechanism in which all Brazilians would automatically be included in a database that generates an individual score for the population and is managed by credit bureaus. The opposition has blocked and prevented the vote of the bill, claiming the impossibility of voting based on the absence of a normative on data protection. With the heat of debates on the subject, House of Representatives and Senate rushed their votes, with a feud that could leave the country without any law on the subject. The subject is extremely important, but it will probably not be voted in a scenario of egos fighting and on election year. Probably the themes that started the year full of strength, will stay for the next term. Politics 09 The legislative race for changing the law of data
  11. 11. It should also be noted that the deadlines established in these projects for their validity are extremely short considering the impact of the new law on the activities of all companies and public agencies in the country. For compliance, companies and state bodies would only have 12 months (in the case of PLS 330) or 18 months (in case of PL 4060/5276). In comparative terms, the GDPR itself had 24 months of vaccatio legis. Thus, if it is true that the country is moving towards a new General Data Protection Law, the companies and entities affected by the new legislation will have to take immediate measures to raise awareness about how personal data are collected, used, transferred and stored in the performance of their activities and seek to prepare for the changes. Luciana Lemgruber Politics 10
  12. 12. 11 Economic Data Month DOLAR IPCA (12 month cumulative) SELIC IBOVESPA GDP PROJECTION 2018 SET.2017 3,17 2,54% 7% 73.626 0,68% OCT.2017 3,26 3,08% 7% 73.323 0,73% NOV.2017 3,27 3,08% 7% 71.971 0,73% DEC. 2017 3,31 2,79% 6,9% 75.996,68 0,98% JAN. 2018 3,17 3,95% 6,75% 85.329,20 2,66% FEB. 2018 3,24 2,84% 6,75% 86.000,80 2,89% MAR.2018 3,33 2,68% 6,50% 82.956,10 2,89% APR.2018 3,46 2,76% 6,25% 86.127,86 2,75% MAY.2018 3,86 2,86% 6,50% 76.753,62 2,37% JUN.2018 3,84 * 6,50% 71.766,52 1,55% *Pending Source: Boletim Focus/Banco Central
  13. 13. Events Calendar 12 SUN MON TUE WED THU FRI SAT 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 29 30 31 1 2 3 4 5 Public Ordinary Meeting of ANVISA Brasília/DF Internal Ordinary Meeting of ANVISA Brasília/DF CONITEC Meeting Brasília/DF CONITEC Meeting Brasília/DF Smarthphone Congress São Paulo/SP 307th Ordinary Meeting of the National Health Council Brasília/DF 307th Ordinary Meeting of the National Health Council Brasília/DF Public Ordinary Meeting of ANVISA Brasília/DF Meetings on the Agreement between Mercosur and the European Union Brasília/DF TeleSynthesis Meeting of 2018: Mobile, Satellite Technologies and the advancement of IoT in Brazil Brasília/DF 138th Meeting of the Board of Directors of the National Health Council Brasília/DF Parliamentary Recess Public Ordinary Meeting of ANVISA Brasília/DF 138th Meeting of the Board of Directors of the National Health Council Brasília/DF Internal Ordinary Meeting of ANVISA Brasília/DF Parliamentary Recess WG - RoHS (Restriction of Certain Hazardous Substances) Brasília/DF Parliamentary Recess