This paper discusses the current regulation of genetically modified organisms and derivatives used in Brazil, where GM-plants are on the verge of being approved for commercial use. The paper further uses a simulation model to assess the potential economic benefits resulting from unrestricted commercial approval of herbicide-tolerant soybeans and some other crops on the Brazilian economy. Only soybean has been specially approved in the last three seasons (2002/03, 2003/04 and 2004/05). As there is no consistent information about the benefits of using transgenic seeds in Brazil, the authors made simulations on the basis of the experiences reported by Argentina and the USA. The paper concludes that Brazil could do much better if government had taken the lead to clarify the legal requirements for research and commercial release of genetically modified crops which are still contradictory and unlikely to control any future environmental impact in Brazil.