On Thursday, Brazil’s Supreme Court ruled that digital platforms are responsible for users’ content — a major shift in a country where millions rely on apps like WhatsApp, Instagram, and YouTube every day.

The ruling, which goes into effect within weeks, mandates tech giants including Google, X, and Meta to monitor and remove content involving hate speech, racism, and incitement to violence. If the companies can show they took steps to remove such content expeditiously, they will not be held liable, the justices said.

Brazil has long clashed with Big Tech platforms. In 2017, then-congresswoman Maria do Rosário sued Google over YouTube videos that wrongly accused her of defending crimes. Google didn’t remove the clips right away, kicking off a legal debate over whether companies should only be punished if they ignore a judge.

In 2023, following violent protests largely organized online by supporters of former President Jair Bolsonaro, authorities began pushing harder to stop what they saw as dangerous behavior spreading through social networks.

Several countries including India and Indonesia already have laws to enable quick removal of content deemed illegal or inappropriate — in contrast to Section 230 in the U.S. that shields online platforms from liability for content posted by users. With this week’s order, Brazil will have one of the strictest regulatory regimes in the world for online platforms. 

Brazil is one of the largest markets for social media companies, with about 144 million users on YouTube, some 112 million on Facebook, and around 140 million on Instagram. It also has more than 145 million active users on WhatsApp, the most popular social media and communication platform in the country.

The court’s decision could lead to a standoff between the U.S. and Brazil. Last month, the Donald Trump administration said the U.S. would punish foreign leaders who go after American tech firms.

Here’s a roundup of expert comments:

What is the news?

Patricia Peck Pinheiro, a specialist in digital law and member of the National Data Protection Commission of Brazil’s National Council of Justice.

While earlier, platforms were liable for user-generated content only if it wasn’t removed after a court order, now they can be held liable upon mere notification. If a platform becomes aware of illegal content and fails to act with due diligence, especially in serious cases like hate speech, deepfakes, or fraud, it will be subject to a fine.

The court’s decision also introduced the concept of systemic failure, which holds providers liable when they fail to adopt preventive measures or remove illegal content. Now, platforms will be expected to establish self-regulation policies, ensure transparency in their procedures, and adopt standardized practices.

Why is this significant?

Ronaldo Lemos, co-founder and chief science officer at the Institute for Technology and Society of Rio de Janeiro.

The impact of this ruling will be very broad. The most affected content will be related to political criticism, reports of corruption, and sensitive discussions involving human rights. This type of content may end up in a gray area where providers feel pressured to take it down out of fear of being held jointly liable.

There will also be an increase in obligations for prior moderation. This will push platforms, and even small internet services or forums, into a state of fear and caution, leading them to proactively remove legitimate content just to avoid lawsuits or financial penalties. This creates a regime of fear and doubt in Brazil.

The Brazilian judiciary, rather than being spared, will become even more of an arbitrator in all types of disputes, with an added problem: Today, disputes happen while the content is still online. This leaves Brazil in a very dark place.

What happens next?

Paloma Rocillo, director of the Brazilian Institute for Research on Internet and Society (IRIS).

Digital platforms will be subject to liability on a much wider range of online content. Before the ruling, platforms were only held liable if they failed to comply with a court order. Now, there is a significantly larger set of normative elements that lower courts must consider when issuing their decisions.

Get The Global, our (free) newsletter Sign up for our weekly newsletter and we’ll send you our latest stories, dispatches from our staff, what we’re reading, and more. A world of tech, right in your inbox.

Email

IRIS conducted a study analyzing over 300 court rulings on content moderation this year and found that 28% of them had no legal basis at all. In other words, judges were deciding based on their personal judgment. With the new understanding established by the Supreme Court, the judiciary now has a wide range of parameters for interpreting the law.

On the side of application providers, the decision is also likely to significantly affect business models. That’s because it introduces new layers of liability, requiring providers to be more rigorous in moderating content, precisely because they can now be held accountable for omissions.

What is expected of Big Tech companies?

Alessandra Borelli, specialist in digital law and data protection, and CEO at Opice Blum Academy, Brazil.

The new legal landscape requires proactive action from Big Tech companies in cases posing high risk to public safety, fundamental rights, or democracy; rapid identification of content boosted or promoted by bots and artificial networks; and the adoption of appropriate measures to prevent the widespread circulation of unlawful content.

Big Tech companies will also be required to comply with new structural obligations, including the creation of clear self-regulation rules with due process, user support channels, and mechanisms to appeal content removals. They will now need to publish annual transparency reports, particularly regarding removed content, received complaints, and paid promotions, and establish legal representation in Brazil with full authority to act in judicial and administrative matters.

If these measures are not implemented, especially in the cases outlined in the Supreme Court’s ruling, platforms may be held liable for systemic failure — a new category of civil liability that reinforces the duty of care within Brazil’s digital ecosystem.

How have Big Tech companies responded?

The shift “imposes strict liability regardless of prior notice to providers, moving away from the principle of content moderation to force platforms into active monitoring, which would constitute a serious violation of fundamental rights,” industry lobby groups representing Big Tech companies in Brazil said in a statement in December.

“Over the past few months, Google has expressed concerns about changes that could affect freedom of expression and the digital economy,” the company said in a statement Thursday. “We remain open to dialogue.”

Meta is “concerned about the implications of the ruling on speech and the millions of businesses” that rely on their apps in Brazil, a spokesperson for the company told Rest of World.

Yareth Zuñiga’s boutique in Ciudad Victoria, in northern Mexico, is usually filled with items from Chinese e-commerce sites SheiniSheinFounded in China in 2008 and headquartered in Singapore, Shein is a fast fashion brand that grew rapidly through exposure on social media.READ MORE and Alibaba. In recent months, her stock has dwindled as new import taxes for Asian goods have caused shipping delays. She has instead turned to another e-commerce platform: TikTok Shop. 

Since its launch in Mexico in February, TikTok Shop has drawn sellers like Zuñiga, an administrator at a public elementary school, who is able to make an income simply by promoting products on the platform without having to keep an inventory.

“It helps me grow and reach more people,” Zuñiga told Rest of World. Whereas earlier, TikTok had been little more than a place for her to share tidbits from daily life with her 46,000 followers, its e-commerce feature has now become a lucrative economic opportunity, she said.

Hundreds of sellers in Mexico have flocked to TikTok Shop in recent months, even as the app faces pressure in the U.S. A national security law passed last year requires TikTok to divest its U.S. business from its Chinese parent company ByteDance, or face a ban. President Donald Trump has delayed the ban thrice, with a deadline for this month extended by 90 days.

Facing uncertainty and slower sales in the U.S. because of trade tensions, TikTok has turned its sights to the south, launching first in Mexico, and then in Brazil — earlier than some analysts had forecast. 

The e-commerce marketplace in Latin America is expected to exceed $1 trillion by 2027, a 100% increase from 2023, according to Payments and Commerce Market Intelligence, a market research firm. TikTok, with more than 111 million users in Brazil, and 81 million in Mexico — the region’s top markets — has an advantage over rivals Shein and Temu, which have an established presence in the region, said Carlos Corona, chief growth officer at Mindgruve, a digital market agency.

“TikTok Shop already has the organic traffic these other platforms are fighting for,” Corona told Rest of World. TikTok Shop has “a huge competitive advantage” in Mexico, which is among the top five countries with the fastest growth rates on TikTok, he said.

Alongside users, these countries also have fast-growing markets for advertising. Brazil and Mexico are the largest markets for advertising for TikTok after the U.S. and Indonesia, according to media agency We Are Social.

Still, TikTok Shop will have to contend with well-established e-commerce giants: MercadoLibre is the dominant platform in the region, while Amazon remains a powerful player in Mexico and Brazil. Shein, launched in Mexico in 2018, and Temu, which arrived in 2023, also have loyal fanbases. With the de minimis loophole closed in the U.S., Shein and Temu — which enable cheap goods to be shipped to customers directly from China — are also serious about Latin America. 

In Mexico, Shein has become a household name thanks to the 3.1 million-strong catalog sales industry. Many of the sellers have incorporated products from the company into their stock.

Its success has also made it a target. To protect local industry from cheap Asian imports, the Mexican government in December announced a 19% tax on items from countries with which it does not have a free trade agreement, including China. The move has hit many Shein and Temu resellers.

TikTok Shop might be able to get around its Asian rivals’ challenges in Mexico, Javier Huerta, a manager at FlowPagos, a platform that helps businesses manage online payments, told Rest of World. One way is cross-docking, where goods bypass traditional storage, or by selling products that are already in Mexico — regardless of their place of origin. This could lure sellers away from platforms such as Shein, Temu, and Facebook Marketplace, he said.

TikTok Shop also has a lower barrier to entry. Valentina Sanchez, a college student in Mexico and a longtime fan of Shein, dreamed of becoming a brand ambassador for the company but her requests went unanswered. In February, she became an affiliate for the newly launched TikTok Shop. Since then, Sanchez has sold cosmetics and clothing on the platform — even going viral for a video in which she modeled garments. She now makes $150 in monthly commissions, Sanchez told Rest of World.

To help sellers make the jump from Shein and Temu to TikTok Shop, several agencies offer advice on social media platforms. IndiePro Marketing, a digital marketing company in Mexico, created a discussion group on Facebook ahead of TikTok Shop’s launch to teach users how to sell and earn money on the platform.

“You can work with 500 or 1,000 creators based on exchanges [free samples], leverage these communities already made for you,” Oscar Fraijo, IndiePro Marketing’s associate director, told Rest of World, referring to the loyal followers the creators have accrued. Now, “all the barriers to purchase have been removed.”

In Mexico, TikTok Shop will become one of the biggest e-commerce giants in the next two years, according to Huerta. For now, the platform offers free shipping throughout Mexico and discounts of up to 50% on first purchases. TikTok Shop’s commission for sellers is currently 6%, well below Shein’s 16% and comparable to AliExpress’ 5% to 8%. 

In Brazil, TikTok Shop could corner nearly 10% of the e-commerce market by 2028, a recent report from Banco Santander predicted. The platform will square off with MercadoLibre and Temu, the two most popular marketplaces, according to Conversion, a Brazilian e-commerce research firm.

Besides fierce competition, TikTok is also not free from the kind of regulatory scrutiny that has threatened its operations elsewhere. Last month, Brazil’s first lady complained to Chinese President Xi Jinping about the potentially harmful effects of TikTok on women and children. This month, a majority of Brazil’s Supreme Court judges said social media companies are liable for content posted by their users.

While social media companies await Brazil’s move, TikTok Shop has called its product launch campaigns in Mexico “a significant” success that has exceeded expectations, and hailed its results as “impressive.”

“The importance of finding success in Latin America is quite clear,” said Corona. “It’s one of the most vital markets for growth.”

In May, BYDiBYDBYD Auto is a Chinese carmaker that became the world’s leading EV manufacturer in 2023, competing with Tesla for market share and global attention.READ MORE’s largest car carrier arrived in Brazil with 7,300 new electric vehicles. The consignment, coupled with two other large shipments a few days later, represented the company’s biggest export operation to Brazil.

BYD, which recently overtook Tesla to become the top seller of EVs globally, made little fuss over its Brazil milestone. But the shipments were welcomed by Brazilians eager to beat rising tariffs on imported EVs.

Since its launch in Brazil in 2015, BYD has grown at a fast pace: Sales rose 327% between 2024 and 2023. The expansion is in large part due to the country’s zero-tax policy for EV imports. But the company’s future is uncertain as Brazil has implemented a progressive tax program for imported EVs, starting at 10% in January 2024 and expected to reach 35% by July 2026. The tariff, which is currently at 18% and rises to 25% next month, is backed by the powerful Brazilian automakers’ lobby.

Tax-free EV imports “favor ready-made imported cars that arrive in Brazil, distorting the logic and natural order of the Brazilian market,” Igor Calvet, president of Anfavea, an industry group that largely represents makers of gas-powered cars in Brazil, told Rest of World. “It takes away from automakers and their Brazilian workers all the potential they otherwise would have.”

BYD did not respond to questions from Rest of World on its sales strategy in Brazil.

Anfavea has said companies like BYD have an “unfair advantage” over local automakers, who face high operational costs and local levies. Under its pressure, the government is weighing the possibility of advancing the final tax implementation date to July, prompting consumers to flock to BYD dealerships before prices go up.

Luiz Fernando Suzarte, an electric engineer in Brasíilia, bought a BYD Song Pro earlier this year, ahead of the planned hike in tariffs in July. “There’s a certain rush to seize this window of opportunity,” Suzarte told Rest of World. “I took many test drives, looking for the most economical car, and between the most popular ones, BYD won for its cost benefits.”

327%

The 1-year rise in BYD sales

With its tax on imported EVs, Brazil is following the playbook of the U.S., which imposes a 100% tariff on Chinese EVs, and the EU, where BYD’s battery electric vehicles are subject to a 27% levy. But Brazil’s progressive tariff is an outlier in Latin America, where countries including Argentina, Costa Rica, and Colombia have reduced or completely eliminated EV tariffs in their push for clean energy.

The U.S. and Europe, with their established auto industries, are the top markets for EVs, according to a report from the International Energy Agency. But emerging markets in Asia and Latin America are adopting EVs at a faster pace. EV sales are expected to exceed 20 million units worldwide this year, with one of every four cars sold set to be electric. Chinese brands accounted for 10% of global EV and plug-in hybrid sales last year, according to energy transition consultancy Rho Motion. That figure is forecast to grow.

In Brazil, the number of imported vehicles sold rose by 18.7% between January and April, while sales of domestically produced vehicles grew 0.2%, according to data compiled by Anfavea. In March and April alone, the country’s automobile market grew 16% solely from the sales of imported cars, while the sale of locally made cars “practically stalled.”

With a goal to sell half its cars outside an increasingly competitive Chinese market, and under pressure to localize production in several countries, BYD is adding manufacturing and assembly units worldwide. But in Brazil, the company has faced several challenges. 

Last year, BYD began building a large manufacturing plant in Camaçari, a town synonymous for decades with Ford Motor. In December, authorities said they had found 163 people working in “slavery-like conditions,” and have since sued BYD for $45.3 million. The company recently announced it had pushed back its rollout of Brazilian-made vehicles from the middle of 2025 to the end of the year.

Get The Global, our (free) newsletter Sign up for our weekly newsletter and we’ll send you our latest stories, dispatches from our staff, what we’re reading, and more. A world of tech, right in your inbox.

Email

“What we want is that there’s no more delay in their beginning of [local] production,” Calvet said. The tax is meant to pressure the company into kickstarting its Brazilian operation. This will lead to job creation and subject BYD to the same tax requirements that other automakers in the country face, he said.

Brazil is the largest market for EVs in Latin America. A recent study from the Latin American Energy Organization, an intergovernmental body, estimates that half the EVs on the continent are in Brazil. By the end of 2024, more than 237,000 EVs had been sold in the country, with an annual growth of 187% compared to the previous year. The organization estimates the number of EVs in Brazil will reach close to 1 million by 2030.

Chinese EVs already account for as much as 90% of Brazil’s active electromobility fleet, according to a report from Oxford Energy Forum.

187% The 1-year rise in EV sales in Brazil in 2024

Brazil is not just a significant consumer market but a huge producer as well. The main objective of the tariffs is “to stimulate local production, promoting a gradual nationalization of the country’s own supply chain for electromobility,” said Edgar Barassa, a researcher of electromobility and public policy at the University of Campinas in São Paulo.

“Brazil is at a crossroads,” Barassa told Rest of World. “Either it positions itself as a key actor in the emergent supply chains for electromobility and clean energy — generating jobs, innovation, and technological sovereignty — or it limits itself to import technologies, losing opportunity in a new global industrial cycle.”

In Vitória da Conquista, a northeastern state, solar-panel company owner Bruno Peter Cardoso recently created a local WhatsApp group for new EV buyers. There has been a spike in new members recently, said Cardoso, who bought a plug-in hybrid BYD in 2023. He would like to buy a fully electric BYD next.

“People are rushing to EVs because they are finally realizing how much better they are,” he said. “It changes your conception of things.”