BRAZIL Law and Practice Contributed by: Cláudio Finkelstein, Maria Isabel Gori Montes and Laura Martini Brevilieri, Finkelstein Advogados
BAA, as an exceptional measure available where there is a concrete risk that a party may be unable to meet an adverse costs award. Although more developed in common law jurisdic - tions, requiring a party to post security is a familiar mechanism in the Brazilian procedural judicial sys - tem, which recognises an analogous institution in the caução (security) provided for in the CCP – for exam - ple, the security that may be required from a claimant resident abroad or without sufficient assets in Brazil to cover the costs and attorneys’ fees of the opposing party (Article 83 of the CCP). Arbitration proceedings seated in Brazil are primar - ily governed by the BAA, which applies to both ad hoc and institutional arbitrations and forms the central statutory framework. The BAA gives the parties broad freedom to determine the procedure (Articles 5 and 21), provided that due process, equal treatment of the parties, impartiality of the arbitrators and the right to be heard are respected. This may cover, among other matters: • the choice between institutional and ad hoc arbi - tration; • the applicable institutional rules or recognised rules for ad hoc proceedings (such as the UNCITRAL Arbitration Rules); • the seat and language; • the procedural timetable; • the appointment of arbitrators; and • the rules on written submissions, evidence and hearings. In institutional arbitration, the chosen institution’s rules govern the procedure and fill any gaps; in ad hoc arbi - tration, the parties and the tribunal have a greater role in defining the procedural framework. 7. Procedure 7.1 Governing Rules The parties may also choose the rules of law applica - ble to the merits (Article 2, paragraph 1), provided that good morals and public policy are respected.
Importantly, the prevailing view – confirmed by the SCJ – is that the CCP does not apply automatically or subsidiarily to arbitration, given its autonomous and private-law nature. The CCP may nevertheless be relevant where the parties or the institutional rules so provide, where a provision is used by analogy in a manner compatible with arbitration, or in court pro - ceedings connected to the arbitration (such as interim relief, court assistance, annulment and enforcement). 7.2 Procedural Steps The BAA does not impose a rigid procedural structure for arbitrations seated in Brazil. The parties are free to define the procedure directly or by choosing insti - tutional rules, provided that fundamental guarantees are respected. In practice, arbitrations usually include one or two rounds of written submissions, an evidentiary phase, hearings, post-hearing submissions and the final award. Terms of reference or similar documents are commonly used to define the claims, applicable rules, timetable, seat, language and composition of the tri - bunal, although they are not required by law. Hearings may be held in person, virtually or in hybrid format, provided that the parties’ procedural rights are pre - served. 7.3 Powers and Duties of Arbitrators Arbitrators in Brazil have broad powers to conduct the proceedings and decide the dispute submitted to them. The BAA equates the arbitrator to a judge, both in fact and in law (Article 18), so that the arbitral award is not subject to appeal or to confirmation by the state courts. Their main powers include: • ruling on their own jurisdiction (Article 8, sole para - graph); • conducting the proceedings (Article 21); • hearing witnesses and determining the production of evidence (Article 22); • granting interim or urgent measures (Articles 22-A and 22-B); • requesting judicial co-operation through arbitral letters (Article 22-C); • rendering partial or final awards (Article 23, para - graph 1); and
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