The independent consumer organization Proteste was founded ten years ago with the aim of improving the situation of those citizens in order to achieve a level of consumer protection similar to that in Europe. The initiative was supported by a grouping of European consumer organizations, known as Euroconsumers, which provided initial financial and technical support, especially in the area of comparative testing of products and services.
When Stefan Zweig, who ended his life in Brazil, published his last book “Brazil: Land of the Future”, a sarcastic critic added: “and always will be…” Seventy years later, it may look like the future has finally arrived, and Brazil is on its way to become one of the five larg¬est economies in the world. It was hardly touched by the financial crisis, and its performance echoes that of China, which is now its major trading partner and export market. Domestic consumption is also booming thanks to significant income redistribution and subsidies to the poorest households. Unfortunately, Brazil is also the country with the most expensive energy, the highest real interest rates, deficient infrastructure, a tremendous bureaucracy and a judiciary which tends to protect more the rights of criminals than those of ordinary citizens. The problem with Brazilian consumers is that they are too passive and do not know their rights sufficiently. There exists a decent consumer protection code, but it is ignored to a large extent by both producers and consumers. E.g. the Brazilian bankers’ lobby went all the way to the Supreme Court to argue that the code did not apply to them. They lost, but it is significant that they thought they had a case. Another battle which they lost against Pro Teste was the introduc¬tion into all financial contracts of a clause which makes explicit the so-called total effective cost (CET) of the credit, expressed on an annual basis and which includes not only interest paid, but all other costs, such as administrative expenses, insurance and taxes. Before, they only men¬tioned the interest rate charged on a monthly basis.
This new law, which was obtained through intensive lobbying by Pro Teste, was first vetoed by President Lula, but finally approved by him, is a typical example of how the work of a consumer organization benefits not only its members, but society as a whole.
Another example was a lawsuit brought by Pro Teste against ANEEL, the regulatory agency of the electricity sector, in order to secure the rights of low-income consumers to a lower tariff. Electricity rates are among the highest in the world, and low-income households simply cannot afford them. This results in a high degree of illegal connections in the favelas of the big cities of the country. Through the victory obtained in the courts, 50 million consumers are benefiting from this action. A third example is an ongoing battle to obtain a lower basic rate and free local calls for fixed line telephone services. The current basic monthly rate amounts to 30 Reais (20 USD) plus a charge for each local call. Pro Teste is arguing that the basic rate was originally set at a high level by the regulatory agency ANATEL to help finance the fixed-line infrastructure at the time of privatization. Now that the infrastructure has been completed and is underutilized, it makes no longer sense to maintain the basic rate at this level. Pro Teste is currently gathering signatures from its members and the public at large to reduce the basic charge to its actual cost to the telephone companies of 7 Reais.