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1. What is the structure and organisation of local courts dealing with commercial claims?

In Brazil, commercial disputes are adjudicated by the State Courts, which include specialized district and federal commercial courts in several states. In São Paulo, for example, where most significant corporate disputes are concentrated, the competence of the specialized Federal Courts for Corporate Law (Câmaras Reservadas de Direito Empresarial) is based on the Court's Internal Rules (Articles 32, §4, 103, and 105) and Resolution no. 623/2013. The National Council of Justice (CNJ) also encourages this kind of specialization (CNJ Recommendation nº 56/2019).

2. What are the main procedural rules governing commercial litigation?

For commercial disputes, Brazilian law applies both the Code of Civil Procedure (Law no. 13,105/2015) which regulates matters such as rules of cognizance (Article 318 et seq.), interlocutory relief (Articles 300–311), evidence (Articles 369–484), and enforcement of judgments/executions (Articles 513 et seq. and 771 et seq.) and the Arbitration Act (Law no. 9,307/1996). In the latter case, the procedure is regulated by the terms agreed by the parties in the arbitration clause (Articles 4, 10, and 11).

3. What pre-action considerations apply?

There are no mandatory "pre-action protocols" as often found in common law systems. Best practices include: - conciliation and mediation (Articles 3 §3 and 165, Code of Civil Procedure); - preserving evidence (early production of evidence, Articles 381–383, Code of Civil Procedure); and - complying with the ADR clauses, when agreed upon.

In contracts containing an arbitration agreement, the terms of the arbitration clause, like the existence of any tiered dispute resolution clauses, must be observed.

4. What are the main alternative dispute resolution (ADR) methods used to settle large commercial disputes?

In Brazil, arbitration is the predominant method for resolving major commercial disputes. This is mainly because the eligibility criteria for arbitrators allow for the appointment of highly qualified professionals, and because arbitral proceedings tend to be faster and conducted with confidentiality. For these reasons, judicial proceedings are considered a secondary alternative.

5. How long, on average, do court proceedings take to reach trial?

There is no official metric for commercial cases nationwide. The time can vary depending on the court, workload, and complexity of the case (ancillary proceedings, expert examinations, and provisional remedies). The National Council of Justice publishes general case-processing indicators but does not have a consolidated indicator for commercial disputes. In summary, the schedule is determined on a case-by-case basis.

6. What disclosure obligations apply? Are parties required to disclose unhelpful documents as well as those on which they rely?

The Brazilian legal system does not have a "discovery phase" like the United States. However, a party may request the disclosure of documents or other evidence (Article 396–404, Code of Civil Procedure). An unjustified refusal may result in the court's presumption of untruthfulness (Articles 400, Code of Civil Procedure) and impose coercive measures such as a fine. There is no general obligation for parties to disclosure unfavourable documents, except when they are common to both parties or subject to a court order.

7. Can witnesses be required to attend trial and face cross-examination?

Yes. As a rule, the lawyer is responsible for summoning their own witnesses (Article 455, Code of Civil Procedure), and unjustified absences may result in forced summoning and fines. Questions are asked directly by the parties (cross-examination) and may also be asked by the judge, who exercises control over their relevance (Article 459, Code of Civil Procedure).

8. What discretion do the courts have in making costs orders?

Courts may order the parties to bear costs as a result of losing the case (Articles 82–85, Code of Civil Procedure). As a general rule, loss of suit fees range from 10% to 20% of the amount of the judgment or the economic benefit obtained (Article 85, §2º), with the possibility of an increase in higher courts (Article 85, §11) if the appeal is unsuccessful. There is also the possibility of the losing party being ordered to reimburse the prevailing party for expenses such as court costs, expert fees, travel expenses etc.

9. What are the main types of interim remedies available?

In arbitration, there is the possibility of provisional or urgent measures before the arbitration (Article 22-A, Arbitration Act). In judicial proceedings, there is urgent relief (which can be anticipatory or precautionary in nature), which require elements that prove the probability of the alleged claim and a risk of harm (Article 300–310, Code of Civil Procedure). Additionally, within the judicial process, there are regular measures such as the freezing of funds (Article 854), search and seizure orders, asset unavailability orders, and injunctive relief.

10. What approach do the local courts adopt with respect to arbitration? What arbitration law applies and is it based on the UNCITRAL Model Law?

As a rule, courts in Brazil uphold arbitration: the competence-competence principle prevails, and judicial proceedings are dismissed when an arbitration agreement exists (Article 485, VII, Code of Civil Procedure). The Arbitration Act (Law no. 9,307/1996), amended by Law no. 13.129/2015, incorporates principles consistent with the UNCITRAL Model Law.

11. Can arbitrators grant interim relief?

Yes. Before the arbitration is constituted, urgent measures may be requested from the courts (Article 22-A, Arbitration Act); thereafter, such measures fall within the jurisdiction of the arbitrators, who may uphold, modify, or revoke the judicial relief (Article 22-B, Arbitration Act), and may request judicial assistance for enforcement purposes (Article 22-C, Arbitration Act).

12. On what grounds can an arbitration award be appealed?

There is no possibility of appealing an arbitral award under Brazilian law. There is only the possibility to request clarification without the review of the ratio (Article 30, Arbitration Act). In addition, the parties can file an annulment action against the arbitral award, based on the hypothesis set forth in Article 32 of the Arbitration Act (for example, if the arbitration agreement is null or void, ultra/extra petita decisions, or violation of public policy). A review of the merits is prohibited.

13. What international conventions and agreements on enforcement of judgments or arbitral awards is this jurisdiction a party to?

Brazil is a party to the main international instruments for the recognition and enforcement of arbitral awards and foreign judgments. In the field of arbitration, Brazil has acceded to the 1958 New York Convention (enacted by Decree no. 4.311/2002) and the Inter-American Convention on International Commercial Arbitration (Decree no. 1.902/1996). At the regional level, there is the MERCOSUR Agreement on International Commercial Arbitration (Decree no. 4.719/2003).

Regarding judicial decisions and arbitral awards, Brazil is also a member of the Inter-American Convention on the Extraterritorial Validity of Foreign Judgments and Arbitral Awards (Decree no. 2.411/1997), as well as the Las Leñas Protocol (Decree no. 2.067/1996). In addition, there is the Protocol on Provisional Measures (Decree no. 2.626/1998) within MERCOSUR, which facilitates the cross-border enforcement of reliefs, complementing the enforcement stage.

Finally, Brazil maintains bilateral treaties with countries such as Italy (Decree no. 1.476/1995) and France (Decree no. 3.598/2000) containing recognition and enforcement provisions. However, Brazil has not yet ratified the Hague Convention on Choice of Court Agreements or the Hague Convention on the Recognition and Enforcement of Foreign Judgments.

14. What types of judgments in commercial matters are enforceable and what types are excluded?

In commercial matters, enforceable instruments include the ones listed in the Code of Civil Procedure (Article 515) such as condemnatory and homologatory judgments (including settlements), as well as foreign judgments duly recognized in Brazil. A domestic arbitral award has the same enforceability as a judgment (Article 31, Law no. 9,307/1996 and Article 515, VII of the Code of Civil Procedure) and, if unliquidated, must first pass for a liquidation phase (Article 509, Code of Civil Procedure). A foreign arbitral award, however, must be recognized by the Superior Court of Justice (STJ) before it can be enforced in Brazil (Article 105, I, Constitution of the Federative Republic of Brazil; Articles 960–965, Code of Civil Procedure; and Article 216-A to 216-D, Internal Rules of the STJ). As a rule, declaratory judgments (including arbitral ones) are not independently enforceable, demanding judicial intervention to give them effect (Article 22-C, Law no. 9,307/1996).

15. What is the process for registration of foreign judgments and arbitral awards?

Firstly, the recognition of foreign judgments and arbitral awards is attributed to the Superior Court of Justice (Article 105, I, Constitution of the Federative Republic of Brazil), as established in Articles 960–965, Code of Civil Procedure and Article 216-A to 216-D, STJ's Internal Rules). The review is limited to formal aspects (summoning, translations, etc.), without any re-examination of the merits; after this, the enforcement is legalized by the first instance federal court (Article 109, X, Constitution of the Federative Republic of Brazil).

16. Once the judgment or award is registered, what are the available methods of execution?

The debtor is notified to make voluntary payment of the debt within 15 days, pursuant to Article 523 of the Code of Civil Procedure. If payment is not made within the specified time, the enforcement mechanisms provided by the Code of Civil Procedure apply, including: - attachment orders (Article 835); - online seizure of assets (Article 854); - premonitory annotation (Article 828); and - protest of the judgment (Article 517).

Other measures may include the attachment of revenue (Article 866) and of corporate shares or stock (Article 861). Among other atypical enforcement measures, see Article 139, IV of the Code of Civil Procedure.

17. What interim measures are available pending enforcement?

Among the available provisional measures are the freezing of funds, seizure, and other reliefs depending on the case (Article 301, Code of Civil Procedure), as well as urgent relief (Article 300). The judge may also adopt atypical enforcement measures (Article 139, IV, Code of Civil Procedure) in a subsidiary and proportional manner — such as confiscation of a driver's license or passport. Within the framework of the typical enforcement mechanisms in the Code of Civil Procedure, the following can be applied: - attachment orders (Article 835); - online seizure of assets (Article 854); - premonitory annotation (Article 828); and - protest of the judgment (Article 517).

Attachment of revenue (Article 866) and of corporate shares or stocks (Article 861) are also permitted.

18. Case study

Proceeding on the assumptions outlined in the Model Answer, would a court in this jurisdiction recognise and enforce the arbitral award under the New York Convention?

In particular: - Does the award fall within the scope of Article V(1) of the Convention, or would any of the grounds in Article V(1) justify refusal on the assumed facts? - Is the subject matter of the dispute capable of settlement by arbitration under domestic law for the purposes of Article V(2)(a)? - Would recognition or enforcement of the award be contrary to public policy within the meaning of Article V(2)(b)?

The enforceability and validity of such a clause under Brazilian law fundamentally depends on the nature of the judicial enforcement title obtained from the state court, particularly whether the judgment is liquid or not.

In the first scenario, if the judicial decision is liquid (i.e., it specifies the exact amount to be paid), an arbitration clause designed to "verify" such payment is highly likely to be declared null and unenforceable. This is because, once the judgment is liquid, there is no longer a "dispute" to be resolved, only the need for compulsory enforcement. In this case, the clause would essentially seek to submit the enforcement phase to arbitration. In Brazil, enforcement is an act of the state's coercive power, not an act of jurisdiction (the power to adjudicate). Therefore, it is an exclusive and non-transferable prerogative of the Judiciary. Attempting to arbitrate the enforcement would violate Article 1 of the Arbitration Act.

However, in the second scenario, if the judgment is illiquid (for instance, if it orders the payment of "lost earnings to be determined"), the clause is entirely valid and effective. In this case, the objective of the arbitration is not enforcement but rather the liquidation of the judgment. This process of quantification is a cognitive activity involving disposable patrimonial rights. In this scenario, the arbitrator would act exactly as the clause provides: confirming that the court judgment has become final (a condition for its jurisdiction), without reopening the merits of the case (which are protected by res judicata), and focusing exclusively on determining the monetary component and interest.

Regarding the requirement of "security", the arbitrator has the authority to grant it as a form of urgent relief (Article 22-B, Arbitration Act). However, since the arbitrator lacks the coercive power to compel the debtor to provide such security, the arbitrator (or the requesting party) must resort to the cooperation mechanism of a Letter of Request (Article 22-C, Arbitration Act), requesting the Judiciary to exercise its coercive powers to enforce the provisional arbitral measure.

Finally, the arbitral award rendered (containing the liquid amount) will constitute an enforceable judgment (Article 515, VII, Code of Civil Procedure) and will be submitted to the Judiciary for the enforcement stage (final execution).

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