COMMERCIAL ARBITRATION: DRAFT BILL OF REFORM OF THE BRAZILIAN ARBITRATION ACT

Brazilian entrepreneurs and foreign investors in Brazil are normally aware of the advantages that arbitration may provide. Resolving disputes much faster than through the State Courts is probably the greatest benefit of this institution. A mature arbitration system has advantages for conducting business in a country and helps to attract foreign investments; furthermore, it avoids eventual distrust towards a country’s judiciary power.

At the beginning of April 2013, the President of the Brazilian Senate, Renan Calheiros, created the Commission of reform of the Brazilian Arbitration Act led by the judge of the Brazilian Supreme Court (Superior Tribunal de Justiça) Luiz Felipe Salomão. This reform aims to improve the Brazilian business environment. The standardisation of the institution of arbitration according to global patterns makes international economic transactions easier, which is why the UNCITRAL Model Law, the New York Arbitration Convention of 1958 and the Inter-American Convention on International Commercial Arbitration are being used for reference.

Some of the most relevant proposals include: (i) the introduction of a general clause of arbitration with the Public Administration; (ii) encouraging arbitration within adhesion, consumption and senior management labour contracts; (iii) the opportunity to choose arbitrators from outside arbitration institution lists; (iv) regulating precautionary measures before the arbitral tribunal has been created; (v) mechanisms for cooperation between the State Courts and arbitration proceedings; (vi) modifying the Brazilian Corporations Act; and (vii) enhancing and promoting arbitration from public institutions. Other proposed modifications are mere technical improvements that intend to clarify certain procedural issues.

Arbitration with the Public Administration. The opportunity to use arbitration when one of the parties involved is the Public Administration has added to the general rule according to which people legally capable can use arbitration in order to resolve disputes concerning disposable rights.

Apr-Jun 2014 issue

Barretto Ferreira e Brancher (BKBG)