BRAZIL Law and Practice Contributed by: Octaviano Duarte, Henrique Forssell and Marcelo Lucidi, Duarte Forssell Advogados
7. Special Rules and Laws 7.1 Rules for Claiming Punitive or Exemplary Damages In the Brazilian legal framework, explicit provisions for the application of punitive or exemplary damages are absent. This is due to the civil liability theory adopted by the Brazilian Civil Code, which measures liability based on the extent of damages (Article 944 of the Civil Code). Despite the lack of legal provisions, case law has recognised a punitive aspect in the determination of moral damages. This serves as a means to punish illicit acts and deter future abuses. 7.2 Laws to Protect “Banking Secrecy” Banking secrecy is a right guaranteed by the Federal Constitution and federal legislation. However, Law No 105/01 allows for the lifting of bank secrecy when necessary to ascertain the occurrence of any unlawful act, at any stage of the investigation or judicial pro - ceedings. The law provides non-exhaustive examples of situations in which this measure is allowed, such as in crimes committed against the national financial system, the public administration, Brazil’s tax system, and social security, as well as in cases of money laun - dering or concealment of assets. Brazilian courts also authorise the lifting of secrecy in cases of corporate fraud that have seriously harmed creditors and other stakeholders, such as financial pyramids, de facto groups structured with the aim of defrauding creditors, and large embezzlements of money and other assets. In these cases, the lifting of secrecy requires strong evidence of financial fraud. Furthermore, in the context of bankruptcy proceed - ings, when bankruptcy is decreed, the judicial admin - istrator takes the place of the company’s former man - agement. This grants the judicial administrator the right and duty to access all of the company’s docu - ments, including financial and bank statements, which is crucial for investigating fraud against creditors. 7.3 Crypto-Assets In December 2022, the Brazilian Congress enacted Law No 14,478, which defines cryptocurrencies
bility of lawyers’ offices and related work documents. These protections extend to any attorney registered with the appropriate Brazilian Bar Association. Due to this constitutional safeguard, any written cor - respondence exchanged between a client and their attorney (who is duly registered with the relevant bar association), whether in physical or digital format, is considered confidential and cannot be disclosed to third parties. Moreover, lawyers are typically prohib - ited from acting as witnesses in legal proceedings unless authorised by the client. Beyond constitutional provisions, various laws and regulations extend simi - lar protections to attorney–client communications in Brazil, including: • Code of Ethical Conduct issued by the Brazilian Bar Association; • Federal Law No 8,906/94, which governs the Bra - Exceptions to the confidentiality rule are rare and require thorough examination on a case-by-case basis. Generally, lawyers may breach client confiden - tiality in limited circumstances, such as when there is a risk to life or reputation, for the lawyer’s own protec - tion against the client, or with explicit authorisation from the client (waiver). It is also possible to waive the attorney’s inviolability if there is proof indicating that a lawyer has engaged in criminal activity. In such cases, a judge has the authority to revoke confidentiality to enforce a search and seizure warrant, with a representative from the Brazilian Bar Association present. However, it is pro - hibited to utilise documents or items owned by clients, as well as any other tools of the trade containing client information, during this process. zilian legal profession; • Civil Procedure Code; • Criminal Procedure Code; and • Criminal Code.
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