INTERNATIONAL ARBITRATION 1/3LY
TECHNICAL 37
L ACK OF CONSENT Plexus Cotton Limited v. Santana Textil S/A 5 ; Indutech SPA v. Algocentro Armazéns Gerais Ltda. 6 ; Kanematsu USA Inc. v. ATS Advanced Telecommunications Systems do Brasil Ltda. 7 ; Oleaginosa Industrial Financeira Imobiliária Y Agropecuaria v. Moinho Paulista Ltda. 8 . In these four 2005 cases, the STJ refused to confirm the foreign arbitral awards on lack of consent grounds, specifically lack of signature, which was then considered a requirement in order to express consent. Recent cases have adopted a view that an agreement in writing, not signature is necessary to establish consent. See L’Aiglon S.A. v. Textil União S/A 9 . RES JUDI C ATA / PARALLEL PROCEEDINGS Parallel proceedings and the effect of res judicata have taken centre stage in the recent jurisprudence of the STJ. The STJ has put to rest the notion that a party can resist confirmation on the grounds of domestic res judicata or parallel proceedings alone. In recent cases, the STJ has looked at the nature of the demand and the remedy sought to determine whether jurisdiction is concurrent or if it overlaps. If there is no complete overlap between the domestic and the international cases, the court will not consider the proceedings parallel. The STJ has confirmed foreign arbitral awards in situations where parallel proceedings existed in Brazil but the Brazilian court has not rendered a decision. See First Brands do Brasil Ltda. v. STP Petroplus Produtos Automotivos S/A PPA 10 (action to annul award is not obstacle where decision has not been rendered). The STJ has also confirmed foreign arbitral awards in cases where a Brazilian decision exists but is posterior to the foreign arbitral award. See Tristao Trading (Panama) S.A. v. Naumann Gepp Comercial e Exportadora, Ltda. 11 . On the other hand, the STJ has refused to enforce portions of an award covering topics that had already been decided by a Brazilian court in Kia Motors Corporation v. Lopes et al. 12 INVAL ID SERV I CE In Subway Partners CV v. HTP High Technology Foods Corporation S/A 13 , the majority of the STJ decided to refuse to confirm the foreign arbitral award on the grounds that the petition required service by letter rogatory. This precedent seems to be an outlier Recent jurisprudence is in agreement that letters rogatory are not necessary when confirming foreign arbitral awards 14 .
PUBL I C ORDER In Ssangyong Corporation v. Eldorado Indústrias Plásticas Ltda. 15 , the STJ refused to enforce an award on the grounds that the petitioner had already submitted to the jurisdiction of the Brazilian courts by filing a notice of claim in the judicial restructuring of the respondent Eldorado. Under the res judicata prong of the grounds, Brazil will also not confirm a foreign arbitral award that has been set aside by the court of the situs of the arbitration. In those cases, the STJ has pronounced that such award is a legal nullity and therefore has no res judicata effect. BAA, Article 38, VI. This does not mean that a double exequatur requirement exists. But once and if the foreign award has been set aside in the courts of the situs, the award is no longer enforceable in Brazil. NON-S IGNATORIES Recent cases have dealt with the binding nature of the arbitration clause in relation to third parties to the arbitration agreement. In Newedge USA LLC v. Manoel Fernando Garcia 16 , the STJ confirmed an award against a guarantor who was not party to the arbitration agreement. Noting that the guarantee made reference to the arbitration agreement as well as the fact that the award had already been “confirmed” by the courts of the situs of the arbitration (New York), the STJ rejected the argument that the enforcement of the award against a non-signatory violated Brazilian’s public order of sovereignty and confirmed the award. 17 CONCLUS ION We reviewed approximately 40 confirmation cases rendered since 2005. We identified only seven cases where the foreign arbitral award was not confirmed. Moreover, the reasoning behind most of these decisions has been rejected in more recent cases. Brazil is increasingly perceived as an arbitration-friendly jurisdiction in part based on the relative solid body of cases from the STJ confirming foreign arbitral awards.
UNL IKE US L AW, BRAZ IL I AN L AW DOES NOT LOOK INTO THE NAT IONAL I T Y OF THE PART IES TO THE ARBI TRAT ION TO DEF INE WHE THER AN ARBI TRAT ION I S DOMES T I C OR INTERNAT IONAL .
3 SEC 968 (2005/ 0053918-3) 4 SEC 3035 (2008/0044435-0) 5 SEC 967 (2005/0053998-0) 6 SEC 978 (200560173771-1) 7 SEC 885 (2005/0034898-7) 8 SEC 866 (2005/0034926-5) 9 SEC 856 (2005/0031430-2) 10 SEC 611 (2005/0055688-0) 11 SEC 9714 (2013/0247110-2) 12 SEC No. 1 EX (2007/0156979-5) 13 SEC 833 (2005/032212-5) 14 See Al-Gharafa Sports Club v. Clemerson de Araujo Soares, SEC 11529 (2014/0136915-1); Paladin PHHolmes Brazil Investors LLC v. Molnar Construtora e Incorporadora Ltda., SEC 8847 (2012/0244916-3); SEC 6760 (2011/0197514-1). 15 SEC 826 (2005/0031322-7) 16 SEC No. 5692 (20012/0246980-3) 17 See also, Converse Inc. v. American Telecommunication do Brasil Ltda., SEC No. 3709 (2008/0266915-8)(confirming foreign arbitration award against parties not original signatories of the arbitration agreement but that had brought counterclaims and had consented to be bound by the arbitration during the course of the arbitration.), LITSA Líneas de Transmisión del Litoral S/A v. SV Engenharia S/A, SEC 894 (2005/0203077-2) (confirming award against party that had succeeded the signatory of the arbitration agreement by acquiring all rights under all assumed contracts through acquisition).
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