Arbitration Agreements - Chapter 5 - Arbitration Law of Brazil: Practice and Procedure
Joaquim T. de Paiva Muniz is a Partner of the Rio de Janeiro office of Trench, Rossi & Watanabe - associated with Baker & McKenzie International. He is also Professor of Business Law and Arbitration in the graduate courses of Fundação Getúlio Vargas (FGV) and Rio de Janeiro State University (UERJ), as well as General Secretary of the Arbitration and Mediation Chamber and coordinator of the Arbitration Commission of the Brazilian Bar, Rio de Janeiro Chapter (OAB/RJ) and author of several articles on international arbitration and Brazilian corporate law.
Ana Tereza Palhares Basílio is a Partner of Andrade & Fichtner Advogados in Rio de Janeiro. Admitted to practice in Brazil, she is also Professor of Arbitration in the graduate courses of Fundação Getúlio Vargas (FGV) and. a member of the chapter management council of the OAB/RJ, Chairwoman of the Arbitration and Mediation Chamber and the Corporate Law Commission of OAB/RJ, as well as Vice-President of its Arbitration Committee. She is a member of the editorial board of Revista de Arbitragem e Mediação and author of several articles on international arbitration and Brazilian civil law.
About the Collaborators:
Arnoldo Wald is a lawyer practicing in São Paulo, Rio de Janeiro and Brasília and is Admitted to practice in Brazil and France. He has a Doctor Honoris Causa - University of Paris II. He is a Senior Professor of the Rio de Janeiro State (UERJ) Law School. Mr. Wald is a Member of the ICC International Court of Arbitration and Editor–in–Chief of Revista de Arbitragem e Mediação. He is author of several books on arbitration, commercial law and civil law.
Carlos Alberto Carmon was one of the three members of the committee that drafted the Brazilian Arbitration Law. He is a lawyer in São Paulo with a Ph.D. from University of São Paulo (USP) Law School. He is Professor of Civil Procedure at USP and author of several books and articles on arbitration.
Carmem Tiburci is a lawyer practicing in Rio de Janeiro. Admitted to practice in Brazil, she has a Ph.D. and LL.M. from the University of Virginia Law School. She is Professor of International Private Law at State of Rio de Janeiro State University (UERJ) Law School and author of several books on international law and international arbitration.
Cristián Conejero Roos is a counsel of the Secretariat of the ICC International Court of Arbitration (Paris, France). Admitted to practice in Chile, she has an LL.M. and was a recipient of the Parker School Recognition for Achievement in International and Comparative Law - Columbia University School of Law.
Nelson Eizirik is a lawyer practicing in Rio de Janeiro and São Paulo. He is a Professor of Corporate Law at the Rio de Janeiro State Magistrate School. He is the author of several books on Brazilian Corporate Law.
Pedro Baptista Martins was one of the three members of the committee that drafted the Brazilian Arbitration Law. He is a lawyer practicing in Rio de Janeiro and São Paulo and Professor of Arbitration at the Rio de Janeiro State Magistrate School. He is the author of several books and articles on arbitration.
Renato S. Grion is an assistant counsel of the Secretariat of the ICC International Court of Arbitration (Paris, France). Admitted to practice in Brazil, he has an LL.M. from Northwestern University School of Law, a graduate certificate in Business Administration from the Kellogg School of Management and a DESS juriste d’affaires international, with honors from University of Paris V.
Originally from Arbitration Law of Brazil: Practice and Procedure
5.1 ARBITRATION AGREEMENTS
Arbitration is consensual in its essence, and the jurisdiction of the arbitral tribunal derives from an enforceable contract, hereinafter referred to as the arbitration agreement, whereby the parties agreed to submit the dispute to arbitration.
The arbitration agreement may be made before the dispute arises, in an arbitration clause (“cláusula compromissória”), or afterwards, through a submission agreement (“compromisso arbitral”).1
This chapter will first address the arbitration clause and, afterwards, the submission agreement, discussing which rules apply to both types of agreements.
5.2 ARBITRATION CLAUSES: NATURE AND VALIDITY
An arbitration clause is a provision whereby the parties to a contract undertake to submit to arbitration either certain or all disputes that may arise in relation to the contract.2
Considering the contractual nature of the arbitral clause, it is subject to the requirements for validity of any contract under Brazilian law, to wit: (i) capacity and power; (ii) valid consent; (iii) lawful and possible subject matter; and (iv) compliance with the legally prescribed form.3
Under Brazilian conflict of law rules, a person’s capacity must be ascertained according to the legislation of his/her country of domicile.4
Individuals domiciled in Brazil are deemed to be capable if they are above the age of eighteen, do not have illness or mental problems that prevent the understanding of their acts, and are able to express their will.5
5. Arbitration Agreements
5.1. Arbitration agreements
5.2. Arbitration clauses: nature and validity
5.2.1. Representation of a party through a power of attorney.
5.2.2. Lack of signature of a party in the contract containing the arbitration clause.
5.3. Autonomy of arbitration clauses
5.4. Negotiating and drafting an arbitration clause.
5.5. Scope of the clause
5.6. Institutional or ad hoc arbitration.
5.6.1. Institutional arbitration.
5.6.1.1. Advantages and disadvantages of institutional arbitration.
5.6.1.2. Choice of arbitration institution.
5.6.1.2.1. Administrative fees charged by arbitration institutions.
5.6.1.3. Selection of an institution as deterrence against future claims.
5.6.1.4. Administration of arbitration by one institution under another institution’s rules.
5.6.2. Ad hoc arbitration.
5.7. Language.
5.7.1. Applicable language if the arbitration agreement is silent.
5.8. Seat of arbitration
5.8.1. Seat of arbitration, in the absence of agreement
5.8.2. Performance of procedural acts in places other than the seat of arbitration
5.9. Efficacy of burdensome arbitration clauses
5.10 Pathologic arbitration clauses
5.11. Effects of arbitration clauses against third parties.
5.11.1. Effects of an arbitration clause on a contract’s assignee.
5.12. Specific performance of arbitration clauses.
5.12.1. Controversy as to the need to seek judicial enforcement, in case of a full arbitration clause.
5.12.2. Previous notice before judicial enforcement.
5.12.3. Procedure for judicial enforcement of arbitration clauses.
5.12.4. Judicial enforcement of arbitration awards involving contracts executed before the Arbitration Law of 1996.
5.13. Submission agreements.
5.14. Termination of the arbitration agreement
5.14.1. Bankruptcy