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September 08 2010
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Allocation of jurisdiction in Brazil in a Exclusive distribution agreements- Jurisdiction clauses- Place of performance
Notes the Brazilian Superior Court of Justice decision in RS Components Ltd v RS do Brasil Comercio Importacao Exportacao Consultoria e Representacoes Ltda on whether the Brazilian courts had jurisdiction to rule on disputes involving a distribution agreement exclusively performed in Brazil, despite the contract expressly providing for these to be submitted to the jurisdiction of a foreign court.
*N1 Agreements exclusively performed in Brazil are subject to the jurisdiction of the Brazilian courts
FN1. Special Appeal (Recurso Especial) No.804.306--SP (2005/0207126-3), having RS Components Ltd as Plaintiff in Error (Recorrente) and RS do Brasil Comércio Importação Exportação Consultoria e Representações Ltda as Respondent (Recorrido), and as Reporting (Relatora) Justice Nancy Andrighi, of the Brazilian Superior Court of Justice (Superior Tribunal de Justiça--STJ). The Third Panel of the STJ decided unanimously to deny the appeal according to the vote of the Reporting Justice that was followed by Massami Uyeda, Sidnei Beneti and Ari Pargendler JJ. FN2. The basic principles of private international law were incorporated into Brazilian law by Law of Introduction to the Civil Code (Lei de Introdução ao Código Civil--LICC (Decree-law No.4657 of September 4, 1949. The rules relating to choice of venue (forum) in Brazilian private international law are to be found in the LICC and in the Civil Procedure Code (Código de Processo Civil--CPC (Law No.5869 of January 11, 1973). Article 12 of the LICC provides that "the Brazilian judicial authorities are competent, when the defendant is domiciled in Brazil or when the obligation has to be performed here". Article 88 of the CPC establishes that "the Brazilian courts are competent when: (i) the defendant, whatever his nationality, is domiciled in Brazil; (ii) the obligation has to be performed in Brazil; and (iii) the action arises from an event or action that took place in Brazil". Therefore, in all three cases, the jurisdiction of the Brazilian courts is not exclusive, the parties being free to choose their venue, subject to the conditions as to public policy, morality and national sovereignty. FN3. These rules are contained in items (ii) and (iii) of art.88 of the CPC, already commented on in fn.2. JIBLR 2009, 24(1), N1 END OF DOCUMENT
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Notes the Brazilian Superior Court of Justice decision in RS Components Ltd v RS do Brasil Comercio Importacao Exportacao Consultoria e Representacoes Ltda on whether the Brazilian courts had jurisdiction to rule on disputes involving a distribution agreement exclusively performed in Brazil, despite the contract expressly providing for these to be submitted to the jurisdiction of a foreign court.
