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External Control of the Regulatory Agencies in Brazil through a Compared Perspective

Marcelo Barros Gomes

This is an exploratory case study in a binary explicit comparative perspective about transformation in regulatory regimes with a focus in the mechanisms of external control implemented by Supreme Audit Institutions (SAI) over utilities regulatory agencies. It is identified analogies and contrasts between the regulatory reform in the telecommunication utility sector of the United Kingdom started in the 1980’s, and the same phenomena in Brazil in the 1990’s.

Differences and similarities found in the reform of these two countries are integrated into their general scheme. On the one hand, the scheme of explanations for the adoption of a convergent model of regulation in both countries, with separation of operation and control of the industry, is exposed. This first scheme leads to a claim that in a certain degree both countries responded to “similar and irresistible forces” to transform their relationship with, and the organisation of, this utility industry.

On the other hand, the scheme of explanations for differences in path, organisation, style, role and distribution of power among actors, and depth of reform leads to another claim that factors inside the States constrained and shaped the reforms.

It is argued that these reforms mirror both external and supranational pressures and inherited and domestic public administration characteristics. In this vein, the dependence path of those reforms should be considered if the results of the regulatory reform could be explained. The essay analyses the Brazilian Supreme Audit Institution practices of oversight over regulatory agencies as an empirical matter. It is argued that the external control of regulatory agencies is crucial for the stability of the regulatory regime. Stability in this context means that, on one hand, the regulatory agency should have autonomy to carry on its mandate; on the other hand, this implies that a huge system of accountability and transparency in the regulation process is always required.

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