This country-specific Q&A provides an overview of International Arbitration laws and regulations applicable in Brazil.
What legislation applies to arbitration in your country? Are there any mandatory laws?
In Brazil, Federal Law nº 9.307/96, recently reformed in 2015 through Law nº 13.129/15(Brazilian Arbitration Law), and Federal Decree nº 10.025/19 are applied to arbitration.
Is your country a signatory to the New York Convention? Are there any reservations to the general obligations of the Convention?
Brazil has ratified the New York Convention in 2002 without any reservations.
What other arbitration-related treaties and conventions is your country a party to?
Brazil is a party to the Geneva Protocol on Arbitration Clauses, the United Nations Convention on Contracts for the International Sale of Goods, the Inter-American Convention on International Commercial Arbitration, the Inter-American Convention on Extraterritorial Validity of Foreign Judgments and Arbitral Awards, and MERCOSUR Agreement on International Commercial Arbitration.
Is the law governing international arbitration in your country based on the UNCITRAL Model Law? Are there significant differences between the two?
Brazilian Arbitration Law[BAL] is inspired by the UNCITRAL Model Law. As for the differences between both laws, it is mentioned that: (i) the UNCITRAL Model Law is applied to all commercial and contractual relations, while BAL is applied to resolve conflicts regarding freely transferable property rights; (ii) Brazilian Arbitration Law does not regulate international arbitration, whereas the UNCITRAL Model Law regulates it; (iii) the UNCITRAL Model Law allows the parties, even during arbitration, to resort directly to state jurisdiction to obtain interim relief, whereas BAL only allows parties to resort to the judiciary to obtain interim relief before the establishment of arbitration, and (iv) differences regarding the validity requirements of the arbitral commitment.
Are there any impending plans to reform the arbitration laws in your country?
What arbitral institutions (if any) exist in your country? When were their rules last amended? Are any amendments being considered?
There are many arbitral institutions in Brazil, among the most commonare Centro de Arbitragem da Câmara de ComéricioBrasilCanadá [CAM/CCBC]; the Conciliation and Arbitration Chamber of FundaçãoGetúlio Vargas [FGV]; Câmara de Conciliação, Mediação e Arbitragem FIESP/CIESP; Câmara de Mediação e Arbitragem Empresarial[CAMARB], Centro de Arbitragem e Mediação AMCHAM [AMCHAM] and Brazil International Chamber of Commerce [ICC]. Their rules were last changed in 2012, 2016, 2013, 2019, and 2017respectively. Changes in ICC rules are being considered.
Is there a specialist arbitration court in your country?
Yes, in the states of São Paulo and Rio de Janeiro.
What are the validity requirements for an arbitration agreement under the laws of your country?
For an arbitration agreement to be valid in Brazil, arbitration must be used to resolve conflicts involving freely transferable property rights. The arbitration agreement must be inwriting, signed by the parties, and contain the requirements of the BAL (article 10).
Are arbitration clauses considered separable from the main contract?
Do the courts of your country apply a validation principle under which an arbitration agreement should be considered valid and enforceable if it would be so considered under at least one of the national laws potentially applicable to it?
Is there anything particular to note in your jurisdiction with regard to multi-party or multi-contract arbitration?
In Brazil, there is no legal provision regarding multi-party or multi-contract arbitration, but neither are there any obstacles to its institution.
In what instances can third parties or non-signatories be bound by an arbitration agreement? Are there any recent court decisions on these issues?
BALdoes not provide specific rules regarding the effects of an arbitration agreement on third parties. Court decisions consider that third parties or non-signatories cannot be bound by an arbitration agreement, therefore they cannot be compelled to participate in an arbitration proceeding of which there is no consent.
Are any types of dispute considered non-arbitrable? Has there been any evolution in this regard in recent years?
Disputes related to unavailable property rights are considered non-arbitrable. There was no evolution in recent years in this regard.
How is the law applicable to the substance determined? Is there a specific set of choice of law rules in your country?
No, the BAL(article 2) provides that the parties may agree that the arbitration shall be conducted under general principles of law, customs and the rules of international trade.
Have the courts in your country applied the UNIDROIT or any other transnational principles as the substantive law? If so, in what circumstances have such principles been applied?
Yes, the courts have applied the UNIDROIT or any other transnational principles as the substantive law in Brazil, when the parties agree that the arbitration shall be conducted under general principles of law, customs, and the rules of international trade.
In your country, are there any restrictions in the appointment of arbitrators?
According to the BAL, arbitrator cannot be somehow linked to the parties or to the submitted dispute.
Are there any default requirements as to the selection of a tribunal?
Any individual with legal capacity, who is trusted by the parties, may serve as arbitrator.
Can the local courts intervene in the selection of arbitrators? If so, how?
Yes, the BALprovides that if there is an arbitration clause and there is objection for the commencement of arbitration by the respondent, the local court can draw up the submission agreement and nominate sole arbitrator (article 7). Also, when the parties appoint an even number of arbitrators, local court can appoint an arbitrator (article 13).
Can the appointment of an arbitrator be challenged? What are the grounds for such challenge? What is the procedure for such challenge?
Yes, if the arbitrators somehow are linked to the parties or to the submitted dispute. According to BAL (article 13), the party who intends to challenge the arbitrator shall present a motion directly to the arbitrator or to the chairman of the arbitral tribunal.
Have there been any recent developments concerning the duty of independence and impartiality of the arbitrators
What happens in the case of a truncated tribunal? Is the tribunal able to continue with the proceedings?
According to BAL (article 16), in cases of a truncated tribunal, the alternate indicated in the arbitration agreement, if any, will assume their position. If no substitute has been appointed, the rules of the arbitral institution or specialized entity shall apply.
Are arbitrators immune from liability?
No, according to article 17 of the BAL, by performing their service, or as a result thereof, the arbitrators shall be considered comparable to public officials for the purpose of criminal law.
Is the principle of competence-competence recognized in your country?
What is the approach of local courts towards a party commencing litigation in apparent breach of an arbitration agreement?
According to BAL, the arbitrator has jurisdiction to decide issues concerning the effectiveness of the arbitration agreement. If one of the parties submitted a judicial suit in breach of the agreement, the arbitral rights are considered waived only if both parties agree.
How are arbitral proceedings commenced in your country? Are there any key provisions under the arbitration laws relating to limitation periods or time bars of which the parties should be aware?
According to BAL, arbitral proceedings commence when the arbitrators accept their appointment (article 19).
Limitation periods and time bars are not established by the BAL and are regulated by the substantive law of the litigation matter. When the arbitral proceeding is commenced, statue of limitation is tolled and its effects retroact to the date of the filling of the request for arbitration.
In what circumstances is it possible for a state or state entity to invoke state immunity in connection with the commencement of arbitration proceedings?
Brazil is a party to the Convention on the Privileges and Immunities of the United Nations and, therefore,when a state consent to arbitration clauses it waives its immunity.Considering there is no specific legislation on jurisdictional immunity, except the convention mentioned, the matter is evaluated on a case-by-case basis.
What happens when a respondent fails to participate in the arbitration? Can the local courts compel participation?
The BALprovides that the claimant can file a specificlawsuit to enforce the respondent to participate in the arbitration. If the resistance persists, the local court shall determine the contents of the submission agreement and appoint a sole arbitrator (article 7). In despite of that, the local court cannot compel the respondent to participate in arbitration.
Can third parties voluntarily join arbitration proceedings? If all parties agree to the intervention, is the tribunal bound by this agreement? If all parties do not agree to the intervention, can the tribunal allow for it?
There is no specific law that regulates non signatory third parties joining arbitration proceedings, and the decision to allow the intervention is determined on a case-by-case basis by the arbitral tribunal. If all parties agree to the intervention, the tribunal is not bound by the agreement, but in most cases is declined to accept.
Due to the substantive law applied in each case, in certain circumstances non-signatories to the arbitration agreement can be bound by the arbitral award if there is consent.
Can local courts order third parties to participate in arbitration proceedings in your country?
What interim measures are available? Will local courts issue interim measures pending the constitution of the tribunal?
Local courts can issue interim measures related to urgent matters regarding the subject of the arbitration, according to BAL(article 22-A), except in cases on which the parties had previously agreed on using an emergency arbitrator relief.
Are anti-suit and/or anti-arbitration injunctions available and enforceable in your country?
Are there particular rules governing evidentiary matters in arbitration? Will the local courts in your jurisdiction play any role in the obtaining of evidence? Can local courts compel witnesses to participate in arbitration proceedings?
The BAL estates that the arbitral tribunal can rule on the evidence production, either by parties’ request or ex officio (article 22). If there is resistance, arbitrators can ask local courts to compel the participation of the witnesses upon evidence of the existence of an arbitration agreement.
What ethical codes and other professional standards, if any, apply to counsel and arbitrators conducting proceedings in your country?
The Brazilian Bar Association has a code of ethics applicable to all the lawyers in the country, and it is applied to counsels conducting proceedings.
Regarding arbitrators, the BALestablishes that the arbitrator shall proceed with impartiality, independence, competence, diligence, and discretion (article 13), and demands the disclosure of information that may affect those qualities (article 14). Most of the arbitral institutions provides ethical standards codes on which arbitrators must abide.
In your country, are there any rules with respect to the confidentiality of arbitration proceedings?
There are no laws regarding the confidentiality of arbitration proceedings, although most of the proceedings are confidential. A great number of thearbitral institutionsprovide rules regarding confidentiality andare applicableunless the parties expressly agree on the contrary, or if one of the parties belongs to the public administration.
How are the costs of arbitration proceedings estimated and allocated?
Each arbitral institution estimates the costs allocated to the litigation. According to BAL, the arbitral award shall decide on the duties of the party in relation to the reimbursement of the costs and expenses of the arbitration. Regarding conflicts involving the public administration, there are specific laws that determine how costs are estimated.
Can pre- and post-award interest be included on the principal claim and costs incurred?
Yes, but it depends on the arbitration agreement and the applicable substantive law.
What legal requirements are there in your country for the recognition and enforcement of an award? Is there a requirement that the award be reasoned, i.e. substantiated and motivated?
According to BAL, the award must be in writing and contain: (a) a report including the names of the parties and a summary of the dispute; (b) the grounds of the decision; (c) the dispositive by which the arbitrators resolve the matter, and must establish a time limit for the compliance with the decision; (d) date and place where the award is rendered; and (e) the signature of the arbitrators.
What is the estimated timeframe for the recognition and enforcement of an award? May a party bring a motion for the recognition and enforcement of an award on an ex parte basis?
In domestic arbitration, the award is automatically recognized and enforceable. In international arbitration, the timeframe for the homologation by the Superior Court of Justice is from 9 to 18 months.
The law does not regulate on the possibility of an ex parte request a motion for recognition and enforcement of an award.
Does the arbitration law of your country provide a different standard of review for recognition and enforcement of a foreign award compared with a domestic award?
Any foreign arbitral award is only recognised and enforced in Brazil if previously subjected to homologation by the Superior Court of Justice, differently than domestic awards, wich are automatically enforced and recognized.
Does the law impose limits on the available remedies? Are some remedies not enforceable by the local courts
Can arbitration awards be appealed or challenged in local courts? What are the grounds and procedure?
Awards cannot be appealed or challenged in local courts, with exception to nullity cases, set by the following circumstances: if (a) the arbitration agreement is null; if the award (b) was granted by an individual who could not serve as an arbitrator; (c) did not comply with the legal requirements; (d) exceeded the limits of the arbitration agreement; (e) failed to resolve the dispute; (f) was granted through unfaithfulness, extortion or corruption; (g) was rendered after the expiration of the time limit; and (h) did not comply to article 21, paragraph 2 of the BAL.
Can the parties waive any rights of appeal or challenge to an award by agreement before the dispute arises (such as in the arbitration clause)?
In Brazil is not permitted to appeal or challenge an award, except in cases of nullity, on which the parties cannot waive their rights to request a declaration of nullity.
To what extent might a state or state entity successfully raise a defence of state or sovereign immunity at the enforcement stage?
In Brazil, enforcement immunity is deemed absolute.
In what instances can third parties or non-signatories be bound by an award? To what extent might a third party challenge the recognition of an award?
The arbitral award can only produce its effects to the parties of the dispute and, third parties cannot challenge the recognition of an award.
Have courts in your jurisdiction considered third party funding in connection with arbitration proceedings recently?
Yes, party funding is used in arbitration proceedings in Brazil.
Is emergency arbitrator relief available in your country? Is this frequently used?
It is available but depends on if the arbitral institutions rules allows it. It is not frequently used.
Are there arbitral laws or arbitration institutional rules in your country providing for simplified or expedited procedures for claims under a certain value? Are they often used?
Yes, such as ICC, AMCHAM and CAM-CCBC. It is not frequently used.
Have measures been taken by arbitral institutions in your country to promote transparency in arbitration?
Yes. Some arbitral institutions (CAM-CCBC and CCI)disclose information such as the names of the arbitrators and their nationality, the arbitrators role within a tribunal, how they were appointment, and if the proceeding is active or not.
Is diversity in the choice of arbitrators and counsel (e.g. gender, age, origin) actively promoted in your country? If so, how?
Have there been any recent court decisions in your country considering the setting aside of an award that has been enforced in another jurisdiction or vice versa?
Have there been any recent court decisions in your country considering the issue of corruption? What standard do local courts apply for proving of corruption? Which party bears the burden of proving corruption?
Not that we are aware of.
Have there been any recent court decisions in your country considering the definition and application of “public policy” in the context of enforcing or setting aside an arbitral award?
Have there been any recent court decisions in your country considering the judgment of the Court of Justice of the European Union in Slovak Republic v Achmea BV (Case C-284/16) with respect to intra-European Union bilateral investment treaties or the Energy Charter Treaty? Are there any pending decisions?
Have there are been any recent decisions in your country considering the General Court of the European Union’s decision Micula & Ors (Joined Cases T-624/15, T-694/15 and T-694.15), ECLI:EU:T:2019:423, dated 18 June 2019? Are there any pending decisions?
What measures, if any, have arbitral institutions in your country taken in response to the COVID-19 pandemic?
Arbitral institutions have suspended all physical protocols. Now, the filling of documents, request for arbitration and mediation proceedings are online (by email or other electronic tools, such as SharePoint). Also, hearings are remote.
In your country, does the insolvency of a party affect the enforceability of an arbitration agreement?
Is your country a Contracting Party to the Energy Charter Treaty? If so, has it expressed any specific views as to the current negotiations on the modernization of the Treaty?
Have there been any recent developments in your jurisdiction with regard to disputes on climate change and/or human rights?
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