Brazil

Part I: what can be enforced?

1. What counts as an arbitral “award” that can be enforced?

Arbitral awards rendered outside Brazilian territory must be previously recognised by the Superior Tribunal of Justice (STJ) to be valid in Brazil. During the recognition/homologation proceeding, the STJ scrutinises the validity of the foreign arbitral award and its conformity with national public policy, ultimately deciding on the possibility of granting the exequatur required by the interested party.

The homologation action must be filed by the plaintiff and adhere to the internal rules of the STJ, the Brazilian Civil Procedure Code (CPC), and the Rules of Introduction to Brazilian Law (LINB). These requirements include:

• Filing of the original or authenticated copy of the foreign award and relevant documents, all duly translated by a sworn translator in Brazil.
• Certification by Brazilian consular authorities (when applicable) or legalisation with an apostille under the Convention on the Abolition of the Requirement of Legalization for Foreign Public Acts (Hague Convention) (1965).
• Issuance of the award by a competent authority.
• Evidence that the parties were validly served.
• Effectiveness of the award.
• The award must not violate sovereignty, human dignity, public policy, or good customs.

If the application for recognition is dismissed due to formal deficiencies, the requesting party is allowed to renew its request after correcting the issues.

Under the Brazilian Arbitration Act (Law No. 9.307/1996), grounds for denying the enforcement of a foreign arbitration award are limited and include:

• Lack of capacity of the parties to the arbitration agreement.
• Invalidity of the arbitration agreement under applicable law or the law of the seat.
• Improper notice of the appointment of the arbitrator or the arbitration to the respondent, or inability to present its case.
• The award exceeds the limits of the arbitration agreement.
• Non-compliance with the arbitration agreement in commencing the arbitration proceeding.
• The arbitration award is not binding or has been annulled or suspended by a court of the seat of arbitration.
• Non-arbitrability of the dispute under Brazilian law.
• Violation of Brazilian public policy.

Domestic arbitral awards are deemed judicially enforceable instruments and may be enforced directly before lower state courts.

2. Formal requirements that an award needs to conform with to be enforceable

As per the Brazilian Arbitration Act, arbitral awards must include (Article 26):

• A report containing the names of the parties and a summary of the case.
• Findings of fact and law on which the award is based.
• An order resolving the issues submitted to the tribunal, and setting a time limit for compliance, if appropriate.
• The date and place where the award was rendered.

The arbitral award must also be signed by the sole arbitrator or all arbitrators. If one arbitrator is unable or unwilling to sign, the president of the tribunal must certify this.

3. Orders on interim measures: enforceability

The Brazilian Arbitration Act provides a unified legal framework for domestic and international arbitration, addressing urgent and provisional matters, cooperation between the arbitral tribunal and judiciary, and the ratification and enforcement of foreign awards.

Before the arbitral tribunal is formed, the Act allows parties to apply directly to state courts for any urgent interim measures that may be necessary. To ensure these interim measures remain effective, the party must initiate arbitration proceedings within 30 days from the date the court order takes effect.

The Act allows arbitrators or arbitral tribunals to issue an arbitral letter to national courts to perform or order the performance of an act requested by the arbitrator (Article 22-C). The Brazilian CPC also facilitates cooperation between local courts and arbitral tribunals, allowing the issuance of arbitral letters for judicial cooperation, including enforcement of provisional remedies (Article 237, IV).

The CPC permits the enforcement of a foreign judgment granting interlocutory relief via a letter rogatory (Article 962), regulated by Inter-Ministry Rule 501/2012, issued by the Ministry of Justice and Ministry of Foreign Relations.

a. Domestic awards

Interim measures granted in domestic awards are enforced through an arbitral letter sent to the civil court where the measure must be executed. Formal requirements for arbitral letters include:

• Identification of the judges of origin and the act.
• The full content of the initial petition, the court order, and the power of attorney.
• Mention of the procedural act constituting its object.
• Closing with the judge’s signature.
• Attachment of the arbitration agreement.
• Evidence of the arbitrator’s appointment and acceptance.

The enforcing judge must determine a deadline for fulfilling the obligations set forth in the award.

b. International commercial arbitration awards

Foreign interim measures are executed via a rogatory letter, following the rules of the Brazilian CPC, Inter-Ministry Rule 501/2012, and STJ’s internal rules.

In the absence of a specific treaty, the foreign court sends the rogatory letter to a central authority in the foreign country, which forwards it to the relevant Brazilian embassy. The Brazilian embassy then submits the letter rogatory to the Ministry of Foreign Relations in Brazil, which delivers the documentation to the Ministry of Justice.

The Ministry of Justice then sends the documents to the STJ, which, after homologation proceedings, may grant the exequatur. If the STJ grants the exequatur, the proceeding is transferred to a lower federal court, where the judge enforces the foreign decision.

4. Emergency awards: enforceability

a. Domestic awards

Please refer to question I(3)(a).

b. International commercial arbitration awards

Please refer to question I(3)(b).

Part II: resisting enforcement

According to the Brazilian Arbitration Act, arbitral awards must be in writing and clearly identify the parties, and contain:

• A report with the names of the parties and a summary of the case.
• Findings of fact and law on which the award is based.
• An order resolving the issues submitted to the tribunal, and setting a time limit for compliance, if appropriate.
• The date and place where the award was rendered (see question I(2)).

5 a. How are awards set aside?

Brazilian courts do not have jurisdiction to annul foreign arbitral awards. Foreign arbitral awards may only be set aside during the homologation proceeding before the STJ, which does not assess the merits of the award but only its recognition.

Once the plaintiff files for recognition before the STJ, the defendant is served with a copy and has 15 days to present its defence.

According to the Brazilian Arbitration Act and the Convention on the Recognition and Enforcement of Foreign Arbitral Awards (1958) (New York Convention), recognition of a foreign award will be denied in narrow circumstances, such as:

• Lack of capacity of the parties.
• Invalidity of the agreement under applicable law.
• Improper notice or inability to present the case.
• Non-compliance with the agreement on the composition of the arbitral authority or procedure.
• The award addresses matters not covered by the arbitration agreement, and it is impossible to separate the decision on these matters.
• The award is not yet binding or has been set aside or suspended by a court in the country where it was made.
• The subject matter is not arbitrable under Brazilian law.
• The award violates Brazilian public policy or sovereignty.

Domestic arbitral awards can be set aside under Brazilian Arbitration Act Art 32 in the following circumstances:

• The arbitration agreement is null.
• The award was rendered by an unqualified person.
• The award does not meet Article 26 requirements.
• The award exceeds the limits of the arbitration agreement.
• The award was rendered due to corruption.
• The award was rendered after the agreed time limit without the arbitrator curing the delay (Article 12, III).
• The tribunal disregarded due process, equal treatment, arbitrator impartiality, or freedom of decision (Article 21(2)).

There is a legal debate on whether domestic arbitral awards may also be annulled on the grounds of violating Brazilian public policy. The STJ has allowed this possibility in at least two cases but rejected the applications for annulment in both.

The limitation period for challenging domestic arbitral awards is 90 days from the notification of the award or the decision regarding a request for clarification.

b. Can enforcement be resisted if the respondent has not formally applied to set aside the award?

During enforcement, the defendant cannot argue grounds set forth in Brazilian Arbitration Act Arts 32, 38, and 39 or New York Convention Art V, as these are exclusively arguable during the recognition proceeding or a nullity action.

However, during enforcement, the defendant may argue: (i) lack of standing; (ii) excess in the amount being enforced; or (iii) any cause modifying or extinguishing the arbitral award obligation, such as payment, performance, novation, set-off, settlement, or statute of limitation.

c. Can non-parties seek annulment?

Under Article 506 of the Brazilian CPC, res judicata generally affects only the parties involved in a litigation proceeding. Therefore, non-parties lack standing to seek annulment of an arbitral award, as it only produces effects and is enforceable between the parties to the arbitration.

d. Grounds to seek setting aside

Please refer to question II(5)(a).

e. Timelines to seek setting aside

As per Article 33(1) of the Brazilian Arbitration Act, the limitation period for challenging domestic arbitral awards is 90 days from the notification of the award or the decision regarding a request for clarification. For international awards, the defendant has 15 days to file its defence in the homologation proceeding.

f. Grounds to resist enforcement

Please refer to question II(5)(b).

g. Which court to go to for setting aside?

The competent court for setting aside arbitration awards is the state court where the arbitration was seated, unless otherwise provided in the arbitration agreement. For foreign awards, the STJ has the authority to deny homologation based on the objections described above.

h. Formal requirements before a court can grant setting aside

The STJ must serve the defendant with a copy of the homologation action and provide 15 days to present its defence. If contested, the proceeding is sent to the Special Court of the STJ, unless there is firm jurisprudence on the matter, in which case the chief justice decides. The chief justice typically grants the Federal Prosecutors Office an opportunity to file an opinion on whether the homologation action satisfies all legal requirements. After this, the STJ issues a decision on the homologation. The interested party may file a motion for clarification and, if any constitutional law is violated, file an extraordinary appeal to the Federal Supreme Court (STF).

In proceedings seeking to declare a domestic arbitral award null, the defendant has 15 days to present its defence. Both parties may present evidence, after which the court issues a decision. The decision may be appealed through the Brazilian appellate system (state court, STJ, and STF).

i. Do courts grant stay on enforcement as an interim measure?

As a rule, enforcement measures are not stayed due to the filing of a defence. However, if the court finds the defence has legal plausibility (fumus boni iuris) and there is a risk of great harm to the defendant (periculum in mora), it may grant an interim measure to stay the enforcement proceeding until the judgment of the merits of the defence.

j. What is the appellate mechanism against the decision of the court of first instance?

The defeated party may appeal to the state court, and then to the STJ and STF. A special appeal to the STJ or an extraordinary appeal to the STF is restricted to matters of law. The main role of the STJ is to ensure uniform interpretation of federal law, while the STF addresses violations of the Federal Constitution.

Part III: enforcing foreign awards

6. New York Convention applicability

The New York Convention was ratified on 7 June 2002 and incorporated into Brazilian law on 24 July 2002 through Decree No. 4.311/2002. It governs the recognition and enforcement of international commercial arbitral awards in Brazil, alongside the Brazilian Arbitration Act, the Brazilian CPC, and the STJ’s internal rules.

7. Timelines for enforcement

• Homologation of arbitral award: there is no specific limitation period for filing a request for the recognition of a foreign arbitral award under Brazilian law and the New York Convention. However, the Brazilian CPC provides a statutory bar after 10 years, unless a lesser period is specified.
• Commencement of enforcement proceedings: the winning party has the same amount of time to initiate enforcement proceedings as it had to exercise a certain right (eg, three years to pursue extracontractual damages claims, and the same period to initiate enforcement after a final decision).

8. Which court to go to? Relation with location of assets?

Brazilian Federal Constitution Art 109, X and Brazilian CPC Art 965 state that enforcement of a foreign award recognised by the STJ takes place before a federal civil court at the trial level. Parties may choose a different venue for convenience if both agree or there is no jurisdictional dispute.

9. Can non-parties resist enforcement?

Non-parties whose assets are improperly attached in enforcement proceedings can challenge the enforcement. Articles 674 to 681 of the Brazilian CPC outline motions available for third parties affected by attachment orders. These motions are usually filed by spouses, partners, buyers, or others mistakenly affected. They must prove ownership of the affected assets to obtain their release.

10. Compelling disclosure of local assets? How to identify assets available for enforcement?

The defendant’s assets can be disclosed through public sources like land registries, vehicle registries, commercial registries, and aircraft registries. A court can order disclosure of assets through measures like breaching fiscal and banking secrecy, SISBAJUD (freezing bank accounts), and RENAJUD (freezing vehicles). Judges access SISBAJUD and RENAJUD systems through secure online platforms.

11. Are third-party funded awards enforceable?

There is no difference in enforceability between third-party funded and non-third-party funded awards.

12. What interim reliefs are available pending enforcement of awards? Which of those reliefs are granted ex parte?

Claimants may petition for preliminary injunctions or seizure orders to prevent asset dissipation or concealment. Brazilian courts consider the strength of legal arguments, evidence, and potential harm when assessing such requests. Preliminary injunctions can be granted ex parte in exceptional circumstances to prevent frustration of the proceeding. Urgency, necessity, or exceptional circumstances justifying the absence of the other party must be demonstrated.

13. Formal requirements for enforcement application: what documents need to be filed in court?

A foreign arbitral award recognised by the STJ is treated as a national court award and follows the Brazilian CPC for enforcement. Typically, the creditor will need to file the award in court, its sworn translation and the homologation decision by the STJ. If the award consists of a money judgment, the judgment creditor must support the complaint with an updated statement of the debt.

14. Enforcing awards that have been annulled/set aside at other courts. Enforcing when an annulment application is pending at a foreign court

To the extent the award has been homologated by the STJ and there are no orders recognised in Brazil suspending its effects, the award can be enforced regardless of any potential annulment applications pending at a foreign court.

15. Once application for enforcement is allowed, how does the actual enforcement against assets work? What are the remedies available for tracing assets during enforcement proceedings including for assets disposed of by fraud?

As described in question III(10), some debtor’s assets information is obtainable via public sources, ie: (i) land registry–holds information on real property ownership; (ii) registry of vehicles–holds information on vehicle ownership; (iii) commercial registry (trade board)–holds information on share ownership; and (iv) aircraft registry–holds information on aircraft ownership.

Besides those public sources, the claimant in an enforcement proceeding may also request a court order to the defendant to disclose their assets and notify third parties to provide any information available about the assets held by the defendant.

The enforcement of a debtor’s assets typically involves obtaining attachment orders, which are obtainable through the plaintiff’s request, demonstrating the nature and location of the assets they seek to attach and ownership by the defendant.

The applicant is entitled to obtain further enforcement measures, including: (i) attachment order to the Central Depositary of Shares, to register over shares of public companies, quotas of investment funds and/or other bonds in the name of the debtor; and (ii) attachment order to the real estate registry, to register over real estate in the name of the debtor.

Attachment of bank accounts is executed via the SISBAJUD system, while attachment of vehicles is executed by the RENAJUD system, both performed directly by the judge.

Once executed, the attachment order creates a lien over the attached assets. If multiple attachment orders are concurrent over the same assets, priority among creditors is generally determined by the date the attachment orders were issued, with a few exceptions.

Brazilian law provides effective mechanisms for tracing and recovering assets disposed of by fraud, such as:

• Fraud upon the execution of judgment–occurs when, at the time of the transfer or encumbrance of assets, there were lawsuits pending against the debtor. Any creditor that filed an enforcement proceeding (or any other legal action against the debtor that could lead the latter to insolvency) before the transaction may challenge the transaction and seek to reclaim the assets, provided certain requirements are met.
• Piercing of the corporate veil–which allows for shareholders, directors, officers and third parties within the same economic group to be held liable for the debts of a company, when they have committed an act of abuse of legal personality, which occurs when there is commingling of assets or deviation from the corporate purpose.

16. What is the procedure for repatriation of sums awarded after obtaining an order for enforcement?

The repatriation of sums awarded after obtaining an order for enforcement follows the same regime for repatriation of sums. This will typically involve remitting money abroad through a financial system authorised to operate in Brazil as well as complying with its due diligence requirements.

17. Do courts grant orders for security for costs?

Generally, plaintiffs are not required to post security for costs in enforcement proceedings.

Article 83 of the Brazilian CPC requires plaintiffs residing outside Brazil or emigrating during proceedings to post a bond to cover costs and opposing counsel fees. This does not apply, however, for enforcement proceedings, including actions to enforce arbitral awards.

18. Exchange control regulations: do they affect payments to foreign award holders?

Brazil has very strict exchange control regulations affecting any inflow or outflow of funds abroad. The payment process involves several steps to comply with Brazilian financial and exchange control regulations:

• Compliance with tax and regulatory requirements–the foreign award holder must comply with Brazilian tax laws, anti-money laundering regulations, and other relevant financial regulations. This typically involves providing necessary documentation and reports to the relevant authorities.
• Foreign exchange transactions–the financial institution handling the payment must conduct the foreign exchange transaction in compliance with Brazilian Central Bank rules. This includes converting the Brazilian reais (BRL) to the foreign currency of the award holder.
• Documentation–the award holder must provide all required documentation, such as proof of the STJ’s recognition of the award, identification documents, and any other information required by the financial institution and regulatory bodies.

These regulations ensure the legality and transparency of the payment process and prevent issues related to money laundering, tax evasion, and other financial crimes.

19. Enforcing awards from non-New York Convention places

The enforcement of awards from non-signatory countries to the New York Convention follows the same procedure described in question I(1).

20. Enforcing against sovereigns

Enforcing arbitral awards against sovereigns involves additional steps due to sovereign immunity. The STJ distinguishes between sovereign acts (jure imperii) and commercial acts (jure gestionis). Sovereign acts are public or government acts, while commercial acts involve private, commercial transactions. Enforcement is more likely for commercial acts. The STF holds that enforcement immunity is absolute, except when the foreign state waives sovereignty over its assets or when assets in Brazil are not allocated for diplomatic or consular activities.

21. Appellate mechanism available?

The defeated party can appeal to a federal court of appeals and ultimately to the STJ and STF (see question II(5)(j)). Enforcement measures are generally not stayed due to appeals.

Part IV: enforcing domestic awards

22. Timelines for enforcement

A domestic award is a judicially enforceable instrument. The limitation period is the same as for exercising the right (see question III(7)).

23. Which court to go to? Relation with location of assets?

Enforcement of domestic awards follows the Brazilian CPC, typically taking place where the defendant has its domicile or headquarters.

24. Compelling disclosure of local assets? How to identify assets available for enforcement?

Please refer to question III(10).

25. Are third-party funded awards enforceable?

Please refer to question III(11).

26. What interim reliefs are available pending enforcement of awards? Which of those reliefs are granted ex parte?

Please refer to question III(12).

27. Formal requirements for enforcement application: what documents need to be filed in court?

Please refer to question III(13).

28. Filing for enforcement when application for annulment is pending

Please refer to question III(14).

29. Once application for enforcement is allowed, how does the actual enforcement against assets work? What are the remedies available for tracing assets during enforcement proceedings including for assets disposed of by fraud?

Please refer to question III(15).

30. Do courts grant orders for security for costs?

Please refer to question III(17).

31. Appellate mechanism available?

The defeated party can appeal to a state court of appeals and ultimately to the STJ and STF (see question II(5)(j)). Enforcement measures are generally not stayed due to appeals.