Brazil: Maritime Arbitration: Recent Developments In Brazil

Last Updated: 9 November 2015
Article by Carbone Law Office

As widely known, arbitration is the most efficient means of modern alternative dispute resolution. As such, maritime arbitration is deeply rooted in shipping practice through arbitration clauses appearing in contracts or being voluntarily adopted by the parties in other circumstances.

It is also a fact that in some countries maritime arbitration has been facing some criticisms due to its high costs and/or the time expended for the arbitral awards to become final. Even in the countries where these criticisms are made, they have been assessed to reflect a decrease, to a certain degree, in the efficiency of arbitration as a means of dispute resolution, however never enough to make it lose its precedence over court litigation in most, if not all, jurisdictions as a more adequate tool to achieve a just solution for controversies.

Until the late nineties and early years of the new century, Brazil was apart from the developments of arbitration then taking place in the rest of the world. But in 1996 the Brazilian Congress enacted Law no. 9.307 which removed the legal obstacles to effectiveness of arbitration in Brazil, thus bringing Brazilian law in line with the most modern legislations in this area. Further, in 2002 Brazil ratified the 19581 New York Convention , therefore definitely joining the modern legal regimes on arbitration.

In an unexpected manner, Brazilian market and legal practice reacted very rapidly and strongly to the legal innovation. It took only five years for Brazilian arbitration to grow exponentially to such an extent to rank in the fourth position of ICC International Court of Arbitration's statistics. Ever since Brazil has held this position, coming after only USA/Canada, Germany and France. On top of that, 188 arbitrations were filed in 2013 with the other six major Brazilian arbitration entities other than ICC-Brazilian branch and the amounts at dispute in these six entities totaled R$ 4,8 billion.

Brazilian arbitration is now widespread. Its main areas are corporate, infra-structure and energy disputes.

The central reason for this extraordinary development lies, certainly, in overwhelming workload that Brazilian Judiciary has been facing, especially since the enactment of new Constitution in 1988. Although this Constitution has greatly expanded the federal Court system and some States have done the same with State systems, the democratic access guaranteed to all under the new constitutional regime combined with the increasing growth of civil society segments have channeled to all branches of the Judiciary a quantity of work that the system has in general been unable to cope with. Litigation increased and it continues to grow on a yearly basis. In 2013 around 95 million cases were in progress before Brazilian Judiciary, a growth of 3,3 % in relation to 2012. The congestion percentage rose from 70,0 % to 70,9 % 2.

Notwithstanding this exceptional development of Brazilian arbitration in general, maritime arbitration strangely did not follow the trend of all other areas. Although arbitration solution is highly familiar to shipping activity, almost all standard forms incorporating arbitration clauses, Brazilian shipping did not develop, at first, a national arbitral culture and, hence, Brazilian parties in the shipping sector did not refer their disputes to local arbitrations. But, paradoxically, at the same time Brazilian parties kept the long tradition of often referring matters to foreign arbitration.

The negative consequences were obvious. Whenever foreign arbitration did not apply, Brazilian parties resigned themselves to letting local disputes to proceed to the Courts, where litigation, in average, can easily take eight or more years to come to an end. Another negative alternative became quite a common practice: the amicable settlement by the defending party and/or their insurers even when the party's right is good, with positive prospects of defence. Particularly P&I Clubs and other foreign insurers choose this otherwise unjustifiable settlement avenue as the lesser of two evils, due to the punishing rates of Brazilian monetary correction (around 6 % p.a.) and legal interest (12 % p.a.), much higher than any rate of return of US and EC investments.

However, this landscape is now changing. Last year, Brazilian Maritime Law Association Chamber of Arbitration, the only specialized entity in Brazil for maritime arbitrations, received arbitration applications of two cases, which when added to one pre-existing case still in progress, totaled 3 cases simultaneously processed — a number never achieved before. Also in 2014, the Chamber of Arbitration of Getúlio Vargas Foundation in Rio de Janeiro — a very reputable academic institution, which, amongst other things, is also devoted to arbitration — instituted 4 proceedings on maritime disputes. So, in all, at least 7 maritime arbitrations were brought before arbitral entities in Rio de Janeiro. Although still shy in absolute numbers, 2014 definitely marked a remarkable beginning for Brazilian maritime arbitration 3.

In last January, 2015, another initiative showed the intensity with which maritime arbitration is now becoming a part of the overall picture of Brazilian arbitration. Several companies, including Transpetro — the greatest Brazilian shipowner and Petrobras' shipping branch —, local law firms and marine adjusters have joined together to found the second specialized Brazilian arbitration chamber for maritime disputes. Re-enacting the same format of the well-succeeded experience of Singapore International Arbitration Centre (SIAC), the newly incorporated Brazilian Centre of Maritime Arbitration (in Portuguese, CBAM – Centro Brasileiro de Arbitragem Marítima) is an arbitral entity designed to be managed by the very potential users of arbitration services .

Law Office Carbone has taken a leading role in this unprecedented development of Brazilian Maritime Arbitration. One of its partners, Luis Felipe Galante, in his capacity as Legal Director of the Brazilian Maritime Law Association, is in charge of administering the arbitration services of the 3 cases now in progress in that Association. In addition, the Association under the presidency of Law Office Carbone's head partner, Artur Carbone, is enacting an entirely new set of Arbitration Rules and Code of Ethics, so as to keep pace with the most recent legal developments of Brazilian arbitration. In the other 4 maritime cases before the Arbitration Chamber of Getúlio Vargas Foundation, Luís Felipe Galante is acting as co-arbitrator in 3 of them and as president of the arbitral tribunal in the remaining one. Law Office Carbone is also co-founder of the CBAM and another firm's partner, Claudia Iabrudi, is a member of CBAM's Board of Directors. Finally, CBAM have just elected Luís Felipe Galante for a 6 year term as head of its Arbitration Commission, the body in charge of creating the legal/administrative structure of the Centre and subsequently manage arbitration services rendered to its users.

Further, in the course of 2015 a number of events will take place in São Paulo, Santos e Rio de Janeiro to promote maritime arbitration, by educating Brazilian lawyers acting in shipping area on the advantages, principles, procedural rules and ethics of arbitration. Law Office Carbone will co-sponsor or support these events together with Sammarco Law Firm from Santos. Support from Brazilian Bar – Santos Section and local companies is expected too.

Several reasons explain this sudden awakening of Brazilian maritime arbitration and its potential to follow the successful steps of Brazilian arbitration experience in general:

  • Modern domestic arbitration legislation;
  • Brazil has become party to the 1958 New York Convention, which makes Brazilian arbitration awards enforceable in over 140 countries worldwide.
  • Brazilian Courts are extremely supportive of arbitration;
  • Brazilian arbitration awards are final as a rule. There are no appeals to Civil Courts. Awards can only be challenged before the Courts in a few circumstances expressly contemplated in the Brazilian Arbitration Act, seeking to annul the judgment of the arbitration tribunal in case of serious formal irregularities;
  • Much lower costs than those charged in almost any other major centre of arbitration such as London, Paris and USA;
  • Availability of small claims procedures in almost all arbitral entities (including in Brazilian Maritime Law Association Arbitration Chamber and CBAM) to deal rapidly and in a cost-effective manner with lower disputes.

Therefore, Brazilian arbitration can now adequately solve a large number of disputes. By "adequate" we mean in significantly less time than the Brazilian Courts and at a much lower cost than foreign arbitrations, not to mention the inherent better quality of arbitral awards as a rule. Furthermore, it must be noted that the potential benefits of arbitration can be greatly expanded by the voluntary adoption of arbitration solution even when previous arbitration clauses are absent, such as cargo claims and tort cases, e.g., collisions. Given the congestion and other problems of Brazilian Courts, Brazilian lawyers may be favourably inclined towards a solution other than litigation in Judiciary. Besides, insureds and insurers may save considerable amounts by avoiding the protraction of punishing Brazilian monetary correction and legal interest.

In other words, while obviously not a panacea, maritime arbitration, given the problems of the Brazilian jurisdiction, can now be a very efficient and quite widespread remedy to solve local disputes in a faster, less costly and more qualitative manner.


1 - Convention on the Recognition and Enforcement of Foreign Arbitral Awards, New York, 1958.
2- Official figures from the National Council of Justice site at .
3 - The stewardship of SIAC is in the hands of the Singapore Business Federation ("SBF"), the apex business chamber that represents the interests of the Singapore business community of more than 15,000 companies.

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.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:
  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.
  • Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.
    If you do not want us to provide your name and email address you may opt out by clicking here
    If you do not wish to receive any future announcements of products and services offered by Mondaq you may opt out by clicking here

    Terms & Conditions and Privacy Statement (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

    Use of

    You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


    Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

    The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


    Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

    • To allow you to personalize the Mondaq websites you are visiting.
    • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
    • To produce demographic feedback for our information providers who provide information free for your use.

    Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

    Information Collection and Use

    We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

    We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to with “no disclosure” in the subject heading

    Mondaq News Alerts

    In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


    A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

    Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

    Log Files

    We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


    This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

    Surveys & Contests

    From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


    If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


    From time to time Mondaq may send you emails promoting Mondaq services including new services. You may opt out of receiving such emails by clicking below.

    *** If you do not wish to receive any future announcements of services offered by Mondaq you may opt out by clicking here .


    This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to

    Correcting/Updating Personal Information

    If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to

    Notification of Changes

    If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

    How to contact Mondaq

    You can contact us with comments or queries at

    If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at and we will use commercially reasonable efforts to determine and correct the problem promptly.

    By clicking Register you state you have read and agree to our Terms and Conditions