For the past 10 years, arbitration has emerged as a successful out of court resolution for disputes in Latin America. Many countries in the region have adopted legislation that supports arbitration. Brazil is one of the South American countries that recently modified its laws to accommodate arbitration.
The Brazilian Arbitration Law was enacted in 1996. Under this law, there is a distinction between the arbitration clause and the arbitration agreement. If parties choose arbitration to settle their dispute, they must enter into an arbitration agreement. Such agreement may be part of the original contract and have an arbitration clause included in it. This law also holds that parties to arbitration must adopt the rules of an institutional arbitration body regardless of whether it is a Brazilian or foreign institution.
The Brazilian Arbitration Law further allows parties to a dispute to establish the place of arbitration, which can be in Brazil or abroad, as well as the preferred language for the arbitration proceedings. Some of the basic principles of the Brazilian Arbitration Law are as follows: the parties must be given notice of hearings and ample time to respond; the parties have the right to present all relevant evidence; the parties have the right to object or respond in the course of proceedings. The arbitrator must be non-partisan. He or she should adjudicate on the matter based on the evidence received.
The Brazilian Arbitration Law has significantly reduced the time it takes to close cases. Using arbitration to settle disputes can save time and allow parties to present their side of the story. Arbitration lawyers have a huge part to play in the arbitration process. Attorneys can influence what evidence is admissible, the date of the hearings, when and how the documents are to be submitted and whether or not to allow more time for a party to prepare their case. After all, at the end of the day, arbitration is a creature of contract.
