Where should a foreign company or individual apply to initiate an enforcement action in Brazil?
The party who wins the case with a court decision is entitled to initiate the enforcement process.
Each of the 26 states in Brazil has independent legislative power, so different practices may be encountered in each state. To prevent this, Regional Courts create precedents.
The enforcement procedure in Brazil must be initiated by submitting a petition to the Court that made the decision.
Foreign court decisions can also be enforced in Brazil if they have been recognized.
The legal process for enforcement in Brazil is generally carried out by filing a lawsuit. This is because enforcement cannot be carried out without a court decision.
On what documents can the enforcement procedure be based?
The party wishing to apply for enforcement must have a final court decision.
If there is no court decision, it is necessary to have a contract with at least 2 witness signatures in order to apply for enforcement.
A contract without at least 2 witness signatures cannot be directly enforced. It is possible to file a lawsuit in court to prove the right to receive payment and then initiate enforcement proceedings.
What is the average duration of litigation in contract disputes in Brazil?
The duration of litigation is between 700-800 days in Sao Paulo courts.
What is the average cost of litigation in Brazil?
The total cost of litigation for a contract law case is equal to 20% of the amount in dispute.
What is the rate of enforcement for contracts in Brazil?
The rate of enforcement for contracts in Sao Paulo is 65.4%.
How long does the enforcement and collection procedure take?
An average of 40-45 days for filing and service,
An average of 480-500 days for litigation,
An average of 210-240 days for enforcing the decision.
Are there any special courts that only deal with commercial cases?
No, there are none.
Are there any courts that can expedite the litigation process based on the value of the claim?
Yes, there are courts that can expedite litigation for small claims.
Can parties attend the trial personally?
Yes, the parties to the case can represent themselves in the trial.
Is the practice of "preliminary hearing" available?
Yes, the preliminary hearing is applied in Brazilian courts.
How are judges assigned in cases?
Judges are automatically assigned in newly filed cases.
Is there a difference in the strength of evidence between testimony given by men and women in court?
The testimony of men and women has the same probative value.
Are there statutes of limitations or other key time limits applied in lawsuits?
Yes, there are general rules that establish time standards for civil cases and proceedings.
Are electronic tools used in lawsuits?
Yes, electronic case management tools are used by lawyers and courts. Applications for lawsuits can be made online.
Can litigation costs be paid electronically?
Yes, court fees can be paid electronically.
Are court decisions and Supreme Court decisions published electronically?
Yes, citizens can access court decisions through online publications.
Is mediation applied before a lawsuit?
There is a separate legal framework for mediation before a lawsuit. Additionally, if the parties successfully complete the mediation process, they may be granted exemptions from fees and taxes.
Is the arbitration procedure accepted by law in local commercial disputes?
Yes, the arbitration procedure for local commercial disputes is regulated by procedural laws.
Are foreign individuals required to deposit any guarantee to initiate an execution process?
As a general rule, foreign individuals are not required to make any deposit to initiate an execution process. However, they must pay court fees. Additionally, if the foreign individual has no residence or presence in Brazil, they may be required to pay upfront expenses that could be collected from them if they lose the case.
What are the statutes of limitations for legal proceedings in Brazil?
According to Sumula 150 of the Superior Federal Court (the highest court in Brazil), the statute of limitations for initiating an execution process is the same as the statute of limitations for filing a lawsuit.
If a shorter period is not provided for by the Brazilian Civil Code, the statute of limitations is 10 years. There are separate statutes of limitations for 1 year, 2 years, 3 years, 4 years, and 5 years.
If a creditor only has an invoice document, how can they collect their debt through legal means?
In this case, the creditor must file a discovery lawsuit to prove that the invoice is an enforceable document.
If a creditor has a document that is considered a negotiable instrument, how is the debt collected?
The creditor with the negotiable instrument must initiate a legal proceeding against the debtor. Prior to any negotiations, the debtor is notified that they must pay the debt or provide adequate collateral. If not, their assets will be seized.
If a creditor only has a contract document, how should the debt collection process be carried out?
If the creditor's contract document contains the signatures of at least two witnesses, the creditor can initiate the execution procedure directly without filing a lawsuit in court. If there are no signatures of two witnesses on the contract, the creditor must file a lawsuit and prove their claim.
The basic distinction for debt collection in Brazil is whether the debt is based on a court decision.
The general execution system is based on the execution process being linked to a court decision. If you have a legally valid court document with execution capability from Brazilian courts, you can apply for an execution process and collect the debt mentioned in the decision.
If your claim does not rely on any court decision but you have a legally valid contract, the presence of witness signatures on your contract will be examined. If the contract underlying your claim has the signatures of at least two witnesses, you can start an execution process without having to go to court.
Is it possible to cancel a debtor's transactions if they fraudulently evade their assets?
In this case, a Paulian action is initiated, and the debtor's asset-reducing transactions carried out in bad faith are canceled, returning to the debtor's equity and being seized by the creditor. The burden of proof in this lawsuit is on the creditor, who must prove that the debtor had the intention to harm themselves.
If the debtor has provided false addresses, invoices, or engaged in any fraudulent commercial transactions, can the creditor start a criminal case against the debtor?
Under the general criminal legislation in Brazil, the directors of a company are personally responsible for fraudulent actions committed in the name of the company.
How many days after the enforcement proceedings are initiated does the notification go to the debtor? Is electronic notification used?
The notification can be sent to the debtor within a maximum of 60 days, but in some cases, it can be faster. Legal proceedings in Brazil are electronic, and there are cases where notification is only a procedural action, but there are mandatory cases where notification must be made by mail or through a probation officer.
What happens if the debtor cannot be found at the address?
If the debtor cannot be found at the address, their addresses with public institutions are researched, and if they still cannot be found, notification is made by publication.
Under what circumstances can the debtor stop the enforcement proceedings?
The debtor's defenses, such as paying off the debt, are reviewed in the enforcement proceedings.
What documents are required for a foreign individual to apply to the enforcement proceedings?
If the foreign individual is a company, their company documents, power of attorney, and evidence should be attached to the request. If the foreign individual is a natural person, their passport, power of attorney, and evidence should be attached. All documents must be submitted with a sworn translation into Portuguese.
What procedure must be followed if a foreign individual wants to appoint a lawyer in Brazil?
It is mandatory to appoint a lawyer in Brazil through notarial services. Therefore, the power of attorney to be given to the lawyer is given through a notary. The procedure used for giving power of attorney in the foreign individual's country is also important. In this regard, the provisions of the "Inter-American Convention on the Legal Regime of Powers of Attorney" are examined. Accordingly, while the power of attorney procedure in the country of the grantor is the main one to be followed, if there is a need to apply different official procedures in the country where the power of attorney will be used, it is mandatory to comply with the procedures of the country where the power of attorney will be used.
If you have a claim in Brazil and want to initiate bankruptcy proceedings against the debtor or want to collect your debt from a bankrupt individual or company, you can contact our office, obtain more detailed information, and have a meeting with our partner law offices in Brazil.