The Brazilian Vice-President, Michel Temer, acting as the President of the Republic, sanctioned on 26/05/2015 Law nº 13.129, of May 26, 2015, which amends Law No. 9.307, of September 23, 1996 (Arbitration Act) in several aspects.
Among the main changes brought by the new law, the following stand out:
- The possibility of the direct and indirect public administration using arbitration to resolve conflicts related to proprietary rights derived from contracts entered thereby;
- The parties opting for arbitration made by an institutional arbitration entity may, by mutual consent, have disregarded provisions from the institution's regulations that limit or restrict the choice of arbitrators;
- Once the arbitration is commenced, the arbitrators are given the authority to maintain, modify or revoking provisional remedies granted by a court of law before commencing the arbitration;
- With respect to corporate conflicts, the new law introduces a change to Law No. 6.404, of December 15, 1976 ("Corporations Act"), determining that in case the required quorum for insertion of an arbitration clause is observed, under the terms of article 136 of the referred law, the presence of an arbitration convention in the bylaws will bind all of the company's shareholders.
- The commencement of the arbitration procedure will interrupt the status of limitation of the lawsuit.
The following provisions of the bill approved by the Brazilian Congress were vetoed:
- In adhesion contracts, the arbitration clause will only be in force if printed in bold or in a separate document. In consumer relationships governed by adhesion contracts, the arbitration clause will only be valid if the consumer himself takes the initiative to commence the arbitration or upon his express consent;
- In individual employment agreements, the use of arbitration will be admitted as long as the employee has the position of administrator or director and provided that the arbitration clause is set forth in the contract and that the initiative to commence arbitration has been taken by the employee or by the employee's express consent.
The new Arbitration law will enter into force 60 (sixty) days after its official publication.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.