According to a report by ECO, the US government has sent letters to companies in Portugal that supply it with goods and services, informing them that they must abandon their diversity, equity and inclusion (DEI) programmes, in accordance with the executive order signed in January by Donald Trump.

The sending of letters was confirmed to ECO by the US embassy in Lisbon, and, according to the international press, similar letters were sent to companies in other European Union countries, such as France and Belgium. However, the embassy doesn’t specify to ECO how many letters were sent, nor does it reveal which companies were targeted.

When asked about the penalties that will be applied if companies fail to comply with the executive order, the US embassy in Lisbon told ECO that no checks will be made, apart from asking contractors to self-certify their compliance with the rules in question.

“The US embassy in Portugal is carrying out a standard global review of contracts, which applies to all suppliers and beneficiaries of US government grants. This process includes a request for certification to ensure compliance with US anti-discrimination laws”, an official source at the embassy told ECO.

The document signed by Donald Trump argues that these DEI programmes weaken the “national unity” of the United States since they “deny, de-credit and undermine traditional American values of hard work, excellence and individual achievement”, while favouring a “corrosive” system based on identity. In other words, for Trump, any programme that promotes diversity, equity and inclusion clashes with meritocracy and is, therefore, a form of discrimination.

Contracts

There are mainly three blocks. The first relates to services provided to the US embassy in Lisbon itself, which it naturally buys locally. There’s everything here, from Vodafone’s telecoms services to gardening work or Allianz’s health insurance, as well as CMS’s legal support services.

A second large block are contracts in the Azores, related to the presence of the Lajes Base, with various local suppliers, such as security guards, cleaning staff, transport services and even a funeral parlour. But also Galp Açores, which sells fuel to the base.

And there is a third, more general block, which includes, for example, the contractual relationship between Fidelidade and the US Air Force, based on insurance cover. Or Meo’s provision of services to the Defence Information Systems Agency (DISA) or, before that, to the Air Force.

In theory, the United States have no right to force EU companies to end their diversity, equity and inclusion programmes.

But in practice, and since it is a question of “determining the conditions under which it is possible for companies to supply goods or services to the US administration”, they can impose rules. This was explained to ECO by José Luís Cruz Vilaça, the partner responsible for the European Union Law, Competition and Foreign Investment practice area at Antas da Cunha Ecija. “If you don’t comply with the rules, you won’t be accepted as a supplier”, emphasises the lawyer.

Portuguese suppliers

ECO questioned several Portuguese companies with contracts with the US government, but there seems to be a cloak of silence around this issue.

The records of the Federal Procurement Data System, where contracts signed between US public entities and any service provider are listed, reveal that among the companies with contracts registered there in the last year alone are organisations such as Vodafone Portugal, Fidelidade, a Mota-Engil company, a Galp company, Caetano Automotive, CTT, Allianz Portugal, MEO or the law firm Rui Pena, Arnaut & Associados (now CMS Portugal).

ECO asked these and other organisations if they had received the letter sent by the US embassy and what they were going to do about it. The overwhelming majority of companies simply didn’t reply, and some even claimed not to have received any communication.