Originially from: World Arbitration and Mediation Review (WAMR) 

The Viability of Arbitration in Brazil Today
by Brian Brooker
[J.D. Candidate, Penn State The Dickinson School of Law,
2006; M.B.A. Candidate, Penn State Smeal College of
Business, 2006; B.S., Brigham Young University, 2002.]
I. Introduction
Brazil’s natural resources and growing economic power have made
the status of arbitration within the country a topic of importance for
foreign investors and the other actors who participate in the global
market. Although Brazil is a “developing country,” it is the eleventh
economic power in the world. Possessing large and well-developed
agricultural, mining, manufacturing, and service sectors, Brazil’s economy
is first in South America. In 2003, Brazil’s gross domestic product was
estimated to have been 1.37 trillion USD. Brazil constitutes a promising
growth market that is rapidly expanding into the international sphere. The
stability of Brazil’s economy and political structure exceeds that of many
other developing countries. The Brazilian economy is growing
exponentially in healthcare, pharmaceuticals, environmental interests,
transportation, telecommunications, and financial services. Brazil’s
economic growth has been accompanied by the development of the
country’s arbitration laws. While Brazil’s arbitration regime has not yet
fully matured, its recent improvement provides security for foreign
investment and facilitates domestic trade and commerce.
This article examines the progress of arbitration in Brazil and
evaluates its effectiveness. Part II provides a historical account of
Brazilian arbitration. Part III analyzes the 1996 Arbitration Act and
outlines the changes it introduced. Part IV investigates the influence that
the UNCITRAL Model Law had on the drafting of the 1996 Act. Part V
discusses the constitutionality of the Arbitration Act. Part VI explores the
significance of MBV v. Resil. Part VII shows how the future of the
Arbitration Act depends on its construction by Brazil’s judiciary. Part
VIII considers the significance of Brazil’s signing of the New York
Arbitration Convention. Part IX studies Brazil’s potential ratification of
the Olivos Protocol for the settlement of disputes within the Mercosur
Union. Finally, Part X concludes that Brazil has overcome the major
impediments to arbitration; despite a few remaining problems, it provides
an arbitration system effective enough to encourage future international
and domestic economic activity.