International Arbitration Comparative Guide

1. Legal framework

1.1 What is the relevant legislation on arbitration in your jurisdiction? Are there any significant limitations on the scope of the statutory regime – for example, does it govern oral arbitration agreements?

The Arbitration Act (9.307/1996), as amended in 2015, is the main statutory regime applicable to arbitration in Brazil. In accordance with Article 4(1) of the act, an arbitration clause must be in writing.

Brazil is also a signatory to the New York Convention. However, it has not signed the International Centre for Settlement of Investment Disputes Convention or any bilateral investment treaty. Hence, investor-state disputes should be dealt with through an arbitration clause in cases where the investor can negotiate one. It is strongly recommended to avoid the Brazilian ordinary courts of justice wherever possible.

Preliminary injunctions and measures can only be ordered by arbitral tribunals once they have been constituted. Until that point in time, competence rests with the ordinary courts of justice (Articles 22-A and 22-B of the Arbitration Act).

1.2 Does this legislation differentiate between domestic arbitration and international arbitration? If so, how is each defined?

Although the Arbitration Act explicitly treats both equally, there are practical differences. The main one is that foreign arbitral awards must undergo an exequatur process (validation to be an executable title in Brazil) before the Superior Tribunal of Justice (STJ), in accordance with Article 35 of the Arbitration Act, which takes about two years. This is not necessary for domestic awards, which can be enforced directly in Brazil.

The definition derives from the territorial principle:

• If the seat of arbitration is in Brazil, the arbitration is domestic; and
• If the seat of arbitration is in another country, the arbitration is international.

1.3 Is the arbitration legislation in your jurisdiction based on the UNCITRAL Model Law on International Commercial Arbitration?

No. However, the Arbitration Act has been influenced by the UNICTRAL Model Law to some extent. It is fair to say that the Arbitration Act is home-grown.

In the 1980s, after decades of rapid growth of the Brazilian economy and the judiciary's inability to deal with this in an efficient way, the business community, attorneys and scholars lobbied for the introduction of arbitration. In November 1991, a commission was formed with the aim of developing draft arbitration legislation. This was headed by Carlos Alberto Carmona, Selma Lemes and Pedro Batista Martin, and the outcome was the current Arbitration Act.

1.4 Are all provisions of the legislation in your jurisdiction mandatory?

No, not all provisions are mandatory. The general principle is that party autonomy reigns. However, the following rules are mandatory:

• the right of the parties to be heard;
• the equality of the parties;
• the impartiality of arbitrators; and
• the freedom and independence of judgement of the arbitrators (within the limits of the applicable law).

1.5 Are there any current plans to amend the arbitration legislation in your jurisdiction?

Yes. The following legal reform projects aimed at revising the Arbitration Act have been introduced to the legislative process since 2015:

• Legislative Proposal 3293/2021: This proposal was introduced by Margarete Coelho. It is intended to regulate the behaviour of arbitrators and to impose certain duties on them. It also aims to facilitate greater publicity of concluded cases. It is uncertain as to whether this initiative will move forward.
• Legislative Proposal 4301/2021: An initiative of Carlos Bezerra, this proposal aims to exclude disputes relating to private pension plans from arbitration.
• Legislative Proposal 2791/2022: This proposal, authored by Alexis Fonteyne, aims to introduce the possibility to arbitrate disputes relating to tax and customs law.

1.6 Is your jurisdiction a signatory to the New York Convention? If so, have any reservations been made?

Yes, Brazil signed the New York Convention on 7 June 2002. It came into force on 5 September 2002. No reservations were made.

1.7 Is your jurisdiction a signatory to the ICSID Convention?

No, Brazil has not signed the ICSID Convention.

1.8 Is your jurisdiction a signatory to any other bilateral or multilateral treaties relevant to arbitration, including sector-specific or regional investment agreements?

Brazil has already signed the Inter-American Convention on Extraterritorial Validity of

Foreign Judgments and Arbitral Awards, concluded at Montevideo on 8 May 1979.

In 1994, Brazil, along with the other member states of the Southern Common market (Mercosur), adopted two protocols to facilitate and protect investments:

• between themselves – the Colonia Protocol; and
• between any of them and other countries – Buenos Aires Protocol.

Furthermore, on 5 June 2003, Brazil signed the Mercosur International Commercial Arbitration Agreement, which is heavily influenced by the UNCITRAL Model Law.

Brazil is also a signatory to the Panama Convention on Commercial Arbitration, which prevails over the New York Convention where a majority of the parties involved are seated in countries which are signatories to the Panama Convention.

Finally, on 31 July 2019, the Mercosur Protocol on Cooperation and Facilitation of Investments between Member States of Mercosur came into force in Brazil.

2. Arbitration in your jurisdiction: institutions, arbitrability and restrictions

2.1 Are any disputes non-arbitrable in your jurisdiction and how is this determined?

Article 1 of the Arbitration Act states that all disposable rights may be subjected to arbitration by the parties to a dispute. The Superior Tribunal of Justice has determined that all matters about which parties can freely transact can be resolved by arbitration. It follows that matters of which at least one of the parties to a dispute cannot freely dispose – such as labour rights meant to protect a party with weaker negotiating power or the rights of minority creditors in insolvency cases – are not arbitrable.

2.2 Are there any restrictions on the choice of seat of arbitration or institution (or lack thereof) in any circumstances in your jurisdiction?

No. The parties are free to choose:

• the administering institution; and
• the seat of the arbitration.

2.3 What are the most commonly selected arbitral institutions in your jurisdiction?

The most commonly used institutions in Brazil are:

• the International Chamber of Commerce;
• the Centre for Arbitration and Mediation of the Chamber of Commerce Brazil-Canada;
• the Chamber of Conciliation, Mediation and Arbitration of the Centre of Industries of São Paulo and the Federation of Industries of São Paulo;
• the Câmara Arbitral do Mercado B3;
• the Brazilian Centre for Mediation and Arbitration; and
• the FGV Chamber of Mediation and Arbitration.

3. Arbitration agreement

3.1 What are the validity requirements for an arbitration agreement in your jurisdiction?

An arbitration agreement must be in written form, in accordance with Article 4(1) of the Arbitration Act. Since the COVID-19 pandemic, documents signed by certified electronic signature are deemed to be equivalent.

3.2 Are there any provisions of legislation or any other legal sources in your jurisdiction that address the separability of arbitration agreements?

Brazilian law recognises the principle of the separability of the arbitration agreement. Hence, if a contract is null and void, the arbitration agreement – according to which the contractual relationship might have to be judged – can be analysed separately, even if it is contained in the same contract (see Article 8 of the Arbitration Act).

The use of separate arbitration agreements which are signed by consumers is common in accession agreements, as this is one of the two possibilities for an arbitration clause to be valid as means of dispute resolution for such contracts (Article 3(2) of the Arbitration Act).

3.3 Are there provisions on the seat and/or language of the arbitration if there is no agreement between the parties?

The Arbitration Act contains no such provisions. However, most institutions have provided solutions in their rules. For example:

• the Arbitration Rules of the Centre for Arbitration and Mediation of the Chamber of Commerce Brazil-Canada include:
• • Article 4.2 on the seat of arbitration in case of gaps in the arbitration clause; and
  • Article 6.2 on the language in case of gaps in the arbitration clause; and
• the 2021 Arbitration Rules of the International Chamber of Commerce include:
• • Article 18(1) on the seat of arbitration; and
  • Article 20 on the language.

4. Objections to jurisdiction

4.1 When must a party raise an objection to the jurisdiction of the tribunal and how can this objection be raised?

A party can raise an objection to the jurisdiction of an arbitral tribunal in two ways:

• If a claimant is convinced that no arbitral agreement exists, it can try to bring its claim before the ordinary courts of justice. However, if an arbitral agreement is found to exist, the judge will be bound to decide in accordance with Article 485(7) of the Code of Civil Procedure that the procedure is extint, without finding on the merits, as it has no jurisdiction.
• Once the arbitral tribunal has been constituted, any party may allege that the tribunal does not have competence. It then falls under the competence of the tribunal to decide whether it has jurisdiction (the kompetenz-kompetenz principle).

4.2 Can a tribunal rule on its own jurisdiction?

Yes, it can.

4.3 Can a party apply to the courts of the seat for a ruling on the jurisdiction of the tribunal? In what circumstances?

A party can bring a claim before the ordinary court of jurisdiction, alleging that it has jurisdiction (instead of an arbitration tribunal).

According to Article 20 of the Arbitration Act, any objections to the jurisdiction of the tribunal must be raised before the tribunal itself once the tribunal has been constituted.

5. The parties

5.1 Are there any restrictions on who can be a party to an arbitration agreement?

In principle, there are no restrictions other than those under general civil procedure law. All natural and legal persons, including state entities, qualify as a 'party' in accordance with Article 1 of the Arbitration Act.

5.2 Are the parties under any duties in relation to the arbitration?

The parties are under several duties, the most important being that of good faith. Other duties of the parties are derived from:

• the rules of the institution chosen by them; and
• the applicable procedural law.

The most relevant duties usually include a duty to:

• conduct the process in a speedy way; and
• pay the costs when so demanded by the institution.

5.3 Are there any provisions of law which deal with multi-party disputes?

The Civil Procedure Law includes provisions on third parties that are not the primary parties to the conflict, but which necessarily have an interest in the outcome of the dispute, such as:

• interveners (litisconsortes, Articles 113 to 118); and
• interveners (assistentes, Articles 119 to 124).

The application of the Civil Procedure Law as a complement to the Arbitration Act is not mandatory. However, the parties can agree on its complementary application in the arbitration agreement. In the absence of such determination, the tribunal may resolve to apply it, in accordance with Article 21(1), as part of the procedure to be established by it in such a case.

In practice, there are numerous scenarios in which multi-party arbitration might arise. Examples include disputes involving:

• agency agreements;
• the transfer of rights; and
• groups of companies.

Furthermore, Article 13(4) of the Arbitration Act states that in multi-party disputes, the parties are not free to suspend the application of a provision of the applicable rules that limits the nomination of arbitrators to a list maintained by the institution. Rather, in such cases, the rules of the institution chosen will prevail over the will of the parties.

6. Applicable law issues

6.1 How is the law of the arbitration agreement determined in your jurisdiction?

Within the boundaries of ordre public and good practice, party autonomy prevails, according to Article 2(1) of the Arbitration Act. Where an arbitration clause is included in a contract, the choice of law in that contract will also govern the arbitration agreement. If there is a separate arbitration agreement that does not contain a choice of law clause, when in doubt, the principles of international private law will be applied. In general, the same law will apply as applies to the contractual relationship from which the dispute arose.

6.2 Will the tribunal uphold a party agreement as to the substantive law of the dispute? Where the substantive law is unclear, how will the tribunal determine what it should be?

Yes, the tribunal will uphold an agreement between the parties on the applicable substantive law, within the limits outlined in question 6.1. If in doubt, the tribunal will apply the general rules of interpretation.

7. Consolidation and third parties

7.1 Does the law in your jurisdiction permit consolidation of separate arbitrations into a single arbitration proceeding? Are there any conditions which apply to consolidation?

As this is not prohibited by Brazilian law, and as the rules of institutions such as the International Chamber of Commerce (Article 10) and the Centre for Arbitration and Mediation of the Chamber of Commerce Brazil-Canada (Article 19) regulate the joinder of arbitral proceedings, this is permitted, subject to the conditions of the applicable rules.

7.2 Does the law in your jurisdiction permit the joinder of additional parties to an arbitration which has already commenced? Are there any conditions which apply to joinder?

See question 5.3.

7.3 Does an arbitration agreement bind assignees or other third parties?

See question 5.3.

8. The tribunal

8.1 How is the tribunal appointed?

The parties can determine the process for the arbitrators' appointment in accordance with Article 13(3) of the Arbitration Act.

8.2 Are there any requirements as to the number, qualifications or nationality of arbitrators in your jurisdiction?

The number of arbitrators must be uneven under Article 13(1) of the Arbitration Act. This also follows from Article 13(2) of the Arbitration Act, which states that if the parties have nominated an even number of arbitrators, the arbitrators are authorised to nominate an additional arbitrator. The reason for this is that the tribunal might need a majority to decide and cannot risk a split vote.

There are no restrictions relating to professional qualifications or nationality.

8.3 Can an arbitrator be challenged in your jurisdiction? If so, on what basis? Are there any restrictions on the challenge of an arbitrator?

Yes, an arbitrator can be challenged on the grounds that he or she:

• is not impartial (eg, due to some economic involvement with one of the parties);
• does not have unlimited legal capacity; or
• has died.

See Article 16 of the Arbitration Act.

8.4 If a challenge is successful, how is the arbitrator replaced?

In such case, the arbitrator is replaced in accordance with Article 16 of the Arbitration Act, which provides that:

• if the arbitration agreement contains a substitute nomination for such cases, it will apply; and
• if it does not, either:
• • the parties will reach agreement on the substitute nomination; or
  • an interested party must follow the procedure set out in Article 7 of the Arbitration Act.

8.5 What duties are imposed on arbitrators? Are these all imposed by legislation?

Arbitrators have a duty:

• to judge the facts according to the applicable law; and
• to draft the arbitral award in accordance with Article 18 of the Arbitration Act.

The arbitral award must include:

• a summary of the case;
• the considerations behind the decision, explaining the facts and the applicable law;
• confirmation of whether the decision was unanimous;
• resolution of all claims and relevant questions brought to the arbitrators' attention, including deadlines for compliance with the decision, where necessary;
• the date and place where the sentence was rendered (see Article 26 of the Arbitration Act; and
• the signatures of the arbitrators.

Additionally, in accordance with Article 13(6) of the Arbitration Act, the arbitrators have a duty to be independent, impartial, competent, diligent and discreet. Accordingly, they have the duty to disclose, before they accept a nomination, any fact that could cause doubt as to their impartiality or independence (see Article 14(1) of the Arbitration Act).

Finally, the arbitrators have the right to be remunerated – usually (unless ad hoc) in accordance with what is stipulated in the rules of the institution that is administrating the arbitration (billed and distributed to the arbitrators by it).

8.6 What powers does an arbitrator have in relation to:

(a) Procedure, including evidence?

With the exception of a pre-arbitration request for the production of evidence before the ordinary courts of justice, the arbitrators have the power to order the production of evidence from the moment that the tribunal is constituted (see Articles 22A and B of the Arbitration Act).

Arbitrators usually have wide discretion as regards procedure, except where bound by the overarching procedural principles, applicable procedural rules or parties' determinations in the arbitration agreement (see Article 21 of the Arbitration Act).

(b) Interim relief?

In accordance with Articles 22A and B of the Arbitration Act, the arbitrators have the power to grant interim relief once the tribunal has been constituted. Until then, the parties must seek such relief before the ordinary courts of justice.

(c) Parties which do not comply with its orders?

As arbitrators cannot force the parties to comply with their orders (unlike the ordinary courts of justice), they must issue an arbitration letter in accordance with Article 22C of the Arbitration Act in order to request the ordinary courts of justice to compel whoever did not comply with the arbitrators' orders to do so (see also Article 237IV of the Code of Civil Procedure).

(d) Issuing partial final awards?

Arbitrators can and should render partial final awards, in accordance with Article 23(1) of the Arbitration Act, if they cannot yet resolve on the merits of all claims – for example, if the merits of one claim are clear but those of another claim depend on a lengthy expert determination which is still to come. An analogy can be drawn with Articles 356 and 355 of the Code of Civil Procedure.

(e) The remedies it can grant in a final award?

The remedies that can be granted in a final award include:

• the payment of money;
• the performance of, or abstention from, acts;
• a declaration that:
• • a certain legal relationship has terminated or is ongoing; or
  • certain rights or duties exist or do not exist; and
• the reimbursement of costs.

In short, the arbitrators can resolve on the same issues as ordinary judges.

(f) Interest?

As Brazil is a high-interest jurisdiction with a volatile monetary climate, awards customarily include decisions on interest and monetary correction. It is recommended to include a provision on this in the terms of arbitration at the beginning of the proceedings.

8.7 How may a tribunal seated in your jurisdiction proceed if a party does not participate in the arbitration?

The non-participating party must be given ample opportunity to legally defend itself and be heard. However, ultimately, according to Article 22(3) of the Arbitration Act, the arbitrators may issue their award.

8.8 Are arbitrators immune from liability?

They are not. In fact, they are liable – just as state court judges are, in theory – if they act grossly negligently or even wilfully. In practical terms, at least where a claim for payment of damages depends on the Brazilian judiciary, the plaintiff will need strong nerves and a lot of patience to perhaps obtain a positive outcome and even more time to eventually get the title executed, if execution in Brazil is necessary.

8.9 Does the legislation in your jurisdiction provide any clarification about the status of emergency arbitrators and enforcement of emergency arbitration awards?

Yes, it does so indirectly: it attributes competence for preliminary injunctions and emergency measures to the ordinary courts of justice for as long as the arbitral tribunal is not constituted – that is, until the (last) arbitrator accepts his or her nomination – in accordance with Articles 22-A and 19 of the Arbitration Act. Consequently, in order to operate as an emergency arbitrator with competence, a valid nomination by the parties and acceptance of that nomination are required. The law refers to an 'arbitrator' in a neutral way – hence, it can mean:

• a sole arbitrator;
• an arbitrator as part of a tribunal; or
• an emergency arbitrator.

In order to boost compliance with these requirements, some institutions – such as the Centre for Arbitration and Mediation of the Chamber of Commerce Brazil-Canada – have enacted provisions on emergency arbitration which allow the parties to have an emergency arbitrator validly instituted before the final arbitral tribunal is constituted (eg, see AR 44/2020 – Rules on Emergency Arbitrator Proceeding).

With regard to the enforcement of awards rendered by emergency arbitrators, the law does not differentiate between final awards and provisional awards. Hence, a party may seek to enforce a provisional measure. However, this is at its own risk, as the order may subsequently be modified or even revoked by the arbitral tribunal. There are a series of interesting procedural questions attached to this, such as whether there is a need to deposit a guarantee for any amounts that are to be executed.

9. The role of the court during an arbitration

9.1 Will the court in your jurisdiction stay proceedings and refer parties to arbitration if there is an arbitration agreement?

Usually, the courts will declare themselves without competence if there is an arbitration agreement. This was the case in Renault v CAOA, for example, in which Renault had sought a decision from the Brazilian judiciary: the court declared itself incompetent and remitted the dispute to arbitration due to the existence of an arbitration agreement between the parties.

9.2 Does the court in your jurisdiction have any powers in relation to an arbitration seated in your jurisdiction and/or seated outside your jurisdiction? What are these powers? Under what conditions are these powers exercised?

There are examples in Brazilian jurisprudence of anti-arbitration injunctions being issued, regarding both domestic and foreign arbitral proceedings. One of the more prominent examples involved an arbitration against a mixed economy company, UEG Araucária Ltda v Copel, in which it was ultimately held that the ordinary courts had to leave it to the arbitrators to declare themselves competent unless the arbitration posed a threat to non-disposable rights (the arbitration had been initiated in Paris, France).

More specifically, the ordinary court have the power to:

• retrieve a dispute from arbitration where non-disposable rights of the parties are at stake;
• pass preliminary injunctions or measures of interim relief, as long as no arbitrator or arbitral tribunal of any kind has been instituted;
• enforce orders of the arbitrators or arbitral tribunal;
• enforce domestic arbitral awards directly and foreign arbitral awards upon homologation by the Superior Tribunal of Justice; and
• set aside arbitral awards if any of the grounds for finding them null and void applies.

9.3 Can the parties exclude the court's powers by agreement?

The court's arbitration-related powers cannot be excluded, as they:

• ensure the functioning of the legal system; and
• protect non-disposable rights of the parties.

10. Costs

10.1 How will the tribunal approach the issue of costs?

In accordance with Article 27 of the Arbitration Act, the arbitral tribunal will include a cost decision in its (final) arbitral award. As the law includes no specific rules on how to determine the ratio of cost and fee-bearing between the parties, it is strongly recommended that a binding rule on this be included in the arbitration clause. Unfortunately, some tribunals in Brazil try to appease the losing party by reducing its burden of costs to be reimbursed, even if that party provoked the arbitration in full knowledge of its remote chances of success and hence wilfully causes substantial cost to the successful party in such cases, even though the winning party wins almost 100% of its claim.

The rules of some institutions (eg, Section 30.4.1 of the Arbitration Rules of the Centre for Arbitration and Mediation of the Chamber of Commerce Brazil-Canada) set out certain criteria for the arbitrators. However, if a party wishes to have the costs (fully) reimbursed in accordance with the overall success, it is imperative to include a clear instruction in this regard for the arbitrators in the arbitration agreement.

10.2 Are there any restrictions on what the parties can agree in terms of costs in an arbitration seated in your jurisdiction?

Party autonomy reigns with regard to agreements on the costs of the arbitral proceedings.

11. Funding

11.1 Is third-party funding permitted for arbitrations seated in your jurisdiction?

Yes. Third-party funding is still not very common in Brazil, but it is increasingly available. Several players from abroad, as well as some Brazilian entities, now offer process financing. It is important for such entities get a clear impression of the prospects of success, which is usually examined in a legal opinion.

11.2 Are lawyers permitted to offer fee arrangements based on a share of damages or an uplift for success for arbitrations seated in your jurisdiction?

Lawyers are allowed to agree on a quota litis as part of their remuneration, in accordance with Article 38 of the Code of Ethics of the Brazilian Bar Association.

12. Award

12.1 What procedural and substantive requirements must be met by an award?

The award must:

• clearly state:
• • the outcome of the proceedings; and
  • the parties' rights and duties within the boundaries of the claims filed; and
• be easily comprehensible by non-lawyers.

Articles 23 to 27 of the Arbitration Act contain specific requirements for awards that go beyond the above common-sense considerations. The award must:

• be rendered within the timeframe agreed between the parties (the standard, in accordance with Article 23 of the Arbitration Act, where the parties are silent on this is six months);
• be in writing, in accordance with Article 24 of the Arbitration Act; and
• contain at least the following elements, in accordance with Article 26 of the Arbitration Act:
• • a summary of the facts, including the names of the parties;
  • the fundamentals of the legal appreciation of the case, including:
  • • an analysis of the facts and the applicable law; and
    • an express mention of whether the arbitrators reached their decision at equity (as opposed to in accordance with codified law);
  • the operative part of the award, in which the arbitrators decide:
  • • all claims brought before them; and
    • the timeframe for performance of the parties, where applicable;
  • the date and place where the award was rendered;
  • a cost decision; and
  • the signatures of (all) arbitrator(s).

12.2 Must the award be produced within a certain timeframe?

Yes, in accordance with the determinations of the parties – that is, by reference to the rules of an institution that contain deadlines or, where applicable, of the arbitrators.

12.3 Does your jurisdiction allow for the correction of errors in an award?

Yes, Article 31 of the Arbitration Act determines that an interested party has five days from receipt of the award to request clarifications and corrections.

13. Grounds for challenging an award

13.1 What are the grounds on which an award can be challenged, appealed or otherwise set aside in your jurisdiction?

The grounds for setting aside an award in Brazil are enumerated in Article 32 of the Arbitration Act, as follows:

• The arbitration agreement was null and void;
• The arbitral award was rendered by someone who could not be an arbitrator;
• The award does not contain the minimum elements defined in Article 26 of the Arbitration Act;
• The limits of the arbitration agreement were not respected;
• It is proven that the award was rendered as a result of corruption, procedural fraud or extortion;
• The arbitrators did not respect the deadline for the award; or
• The award was rendered in non-compliance with the principles listed in Article 21(2) of the Arbitration Act (conduct in accordance with the main applicable procedural rules).

13.2 Are there are any time limits and/or other requirements to bring a challenge?

Yes, a challenge must be brought within 90 days of receiving notice of the award, in accordance with Article 33(1) of the Arbitration Act.

13.3 Are parties permitted to exclude any rights of challenge or appeal?

An appeal is not possible. Parties do not have the right to exclude other rights of challenging the award. However, they will frequently insert a penalty clause to prevent any challenge of the validity of the arbitration agreement.

14. Enforcement of awards

14.1 Are awards enforced in your jurisdiction? Under what procedure?

The procedure for the enforcement of awards depends on whether they are domestic or foreign. Domestic awards are enforced directly in the same way as court sentences. Foreign awards must first undergo an exequatur procedure before the Superior Tribunal of Justice, which takes about two years, in order to be enforced in Brazil, in accordance with Article 37 of the Arbitration Act.

15. Confidentiality

15.1 Is arbitration seated in your jurisdiction confidential? Is a duty of confidentiality found in the arbitration legislation?

Yes, in practice, arbitration is confidential in Brazil, even though there is no rule to this effect in the legislation. The rules of the arbitral institutions that frequently administer cases also provide for confidentiality; and the parties may include provisions on confidentiality in the arbitration agreement. Whenever a dispute arises in relation to a contract that contains a confidentiality clause, the arbitral proceedings must also be confidential.

15.2 Are there any exceptions to confidentiality?

Some exceptions are mentioned explicitly in law, such as arbitration involving state entities and public administration, in accordance with Article 2(2) of the Arbitration Act. This is logical, as the principle of accountability of administration reigns, which presupposes that there is transparency – at least legally and in theory – of all acts and omissions of the public administration.

Probably the most common examples of arbitral proceedings becoming public are those in which the parties opt not to keep them confidential.

While concerns are frequently voiced in this regard, neither carta arbitral proceedings nor requests to set aside awards before the ordinary courts make the arbitral proceedings public, as they must be conducted under the secrecy of justice, in accordance with Article 189(IV) of the Civil Procedure Act.

16. Ethical and professional rules

16.1 Are there any ethical or professional rules applicable to counsel and arbitrators who conduct an arbitration seated in your jurisdiction?

Brazilian law contain no such rules that specifically apply to counsel in arbitration and arbitrators. However, ethical and professional rules do apply. For example, all lawyers serving as party counsel are subject to the ethical rules of the Code of Ethics for lawyers, passed by the Brazilian Bar Association in its latest version from 19 October 2019.

As discussed in question X, arbitrators are subject to ethical duties both:

• directly (eg, being impartial); and
• indirectly (eg, not being corrupt, as this is one of the grounds on which an award can be set aside as null and void).

17. Trends and predictions

17.1 How would you describe the current arbitration landscape and prevailing trends in your jurisdiction? Are any new developments anticipated in the next 12 months, including any proposed legislative reforms?

The caseload of the main arbitration institutions is continually growing and arbitration is an increasingly popular choice for dispute resolution, as the Brazilian judiciary remains weak, inefficient and of poor quality. Recent legislative proposals and their chances of adoption are discussed in question X.

18. Tips and traps

18.1 What are your top tips for smooth arbitration in your jurisdiction and what potential sticking points would you highlight?

• To the extent possible, avoid disputes when drafting contracts. In Brazil, you cannot simply trust that the other party will comply with its duties under a contract. It is strongly recommended to insert contractual mechanisms through which you can retain factual control over the performance of the contractual duties.
• Insert arbitration clauses in your contracts and ensure that they are properly drafted, considering the particularities of arbitration with Brazilian parties.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.