BRAZIL Law and Practice Contributed by: João Areosa, Guilherme Peres de Oliveira and Raphael Rangel, Areosa Advogados
Areosa Advogados R. do Rocio, 350 - 11o andar Vila Olímpia, São Paulo - SP CEP: 04552-000 Brazil Tel: +55 11 3841-9000 Email: contato@areosa.com.br Web: areosa.com.br
1. Policy Development of Collective Redress/Class Action Mechanisms 1.1 History and Policy Drivers of the Legislative Regime Constitutional Foundation and Early Development Collective redress mechanisms in Brazil have deep constitutional roots, with the Federal Constitution of 1988 establishing access to justice and collective rights protection as fundamental principles. The Bra- zilian system was designed to address mass viola- tions of rights and facilitate access to justice for dif- fuse and collective interests that would be impractical to litigate individually. The foundational legislation was established prior to the current Constitution. Law 7.347/1985, also known as the Public Civil Action Act (LACP), established the first comprehensive framework for collective actions aimed at protecting the environment, consumers, cul- tural heritage and other collective interests. This legis- lation was groundbreaking in Latin America, establish- ing a procedural mechanism specifically designed for collective litigation at a time when such concepts were still developing internationally. The Consumer Protection Code Revolution The landmark Consumer Defence Code (Law 8.078/1990 – CDC) significantly expanded and refined the collective redress system. It introduced a sophisti- cated classification of collective rights into three cat- egories: diffuse rights (indivisible rights of undeter- mined persons connected by factual circumstances), collective rights stricto sensu (indivisible rights of a determined group connected by legal relationships) and individual homogeneous rights (divisible rights
arising from a common origin). This tripartite classifi- cation remains a distinctive and innovative feature of Brazilian collective litigation, influencing how courts analyse standing, res judicata and remedies. Integration With Modern Civil Procedure The Civil Procedure Code of 2015 (CPC/2015) further modernised collective litigation by incorporating pro- visions on group litigation, creating the “incident of resolution of repetitive demands” (IRDR), and estab- lishing rules for representative appeals. These mecha- nisms complement the specialised collective action legislation and address mass litigation more efficiently by creating binding precedents that prevent repetitive litigation on identical legal issues. Policy Drivers Behind the Legislative Regime The development of Brazil’s collective redress regime was driven by several policy considerations. First, it was recognised that individual lawsuits would be inadequate for addressing mass harm affecting large groups, particularly when individual damages were minimal but aggregate harm was significant. Sec- ond, enhancing the efficiency of judicial administra- tion necessitated mechanisms to consolidate similar claims and prevent the proliferation of identical indi- vidual lawsuits. Third, ensuring access to justice for claims that would be economically unviable individu- ally became paramount, especially for consumers fac- ing powerful corporate defendants. Additionally, the system was designed to deter ille- gal conduct through comprehensive enforcement mechanisms beyond individual suits. Ensuring the protection of fundamental rights enshrined in the 1988 Constitution, particularly consumer rights, environ-
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