BRAZIL Law and Practice Contributed by: João Areosa, Guilherme Peres de Oliveira and Raphael Rangel, Areosa Advogados
Judicial approval requirements When entered into before litigation, a TAC does not require judicial approval and is immediately enforce- able. When entered into to settle pending litigation, court approval is required. The judge evaluates wheth- er its terms adequately protect collective interests. Judicial settlements Parties may settle collective actions at any stage. Settlement requires agreement between plaintiff and defendant; participation of the Public Prosecutor if involved as party or custos legis; and judicial approval The court evaluates whether the settlement protects collective interests; whether its terms are fair, rea- sonable, and sufficient to remedy violations; whether affected parties received adequate notice of the pro- posed settlement; and the Public Prosecutor’s opinion (mandatory, as the Public Prosecutor must opine on settlement adequacy). after evaluation of terms. Judicial approval process The judge may reject settlements deemed inadequate or contrary to public interest. Unlike private bilateral contracts, collective action settlements require judicial scrutiny to ensure collective interests are protected, as settlors are not the actual beneficiaries. Alternative Dispute Resolution Mediation Mediation is increasingly used in collective disputes. Court-annexed mediation programmes are expand- ing, with trained mediators facilitating negotiations. Mediation is effective in multiparty environmental disputes, consumer cases involving ongoing relation- ships, and matters where negotiated solutions may better address interests than adjudicated outcomes. Mediation may occur pre-litigation during civil inves- tigations or during proceedings when courts refer cases to mediation. Parties may voluntarily seek pri- vate mediation. The CPC encourages mediation and requires court mediators to be available. Conciliation Conciliation hearings are common and often manda- tory in civil cases. A judge or court conciliator over-
sees negotiation, focusing on specific settlement pro- posals. Conciliation is more directed than mediation, with conciliators proposing terms and encouraging parties to accept reasonable offers. In collective actions, conciliation hearings typically occur early in proceedings and may be repeated at later stages. While success rates vary, many cases are settled through conciliation. Arbitration Arbitration is typically unavailable for collective or dif- fuse rights, and even individual consumer claims of a homogeneous nature are usually non-arbitrable under consumer protection rules. Arbitration may nevertheless be employed in corpo- rate collective disputes among shareholders or other commercial matters where arbitration agreements exist and the rights are subject to party disposition. It may also be used to enforce collective judgments regarding individual claims, if the parties consent. Public Civil Action Settlement Programmes Certain courts and Public Prosecutor offices have established specialised settlement programmes for collective actions, promoting early resolution through structured negotiation, pre-litigation settlement con- ferences and dedicated mediators with expertise. 3.13 Judgments and Enforcement of Judgments Nature of Judgments Judgments in collective actions may be declaratory (establishing rights, legal relationships or interpreta- tion of laws); constitutive (creating, modifying or extin- guishing legal relationships); condemnatory ( conde- natório ) (imposing monetary or conduct obligations); or mandatory ( mandamental ) (ordering specific con- duct with immediate enforceability through coercive measures). Many collective action judgments com- bine multiple types, declaring rights while imposing conduct and monetary obligations. Binding Effect and Res Judicata Brazilian res judicata rules vary significantly by type of collective right and case outcome:
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