Constitutional Foundation and Early Development

Collective redress mechanisms in Brazil have deep constitutional roots, with the Federal Constitution of 1988 establishing access to justice and collective rights protection as fundamental principles. The Brazilian system was designed to address mass violations of rights and facilitate access to justice for diffuse and collective interests that would be impractical to litigate individually.

The foundational legislation was established prior to the current Constitution. Law 7.347/1985, also known as the Public Civil Action Act (LACP), established the first comprehensive framework for collective actions aimed at protecting the environment, consumers, cultural heritage and other collective interests. This legislation was groundbreaking in Latin America, establishing a procedural mechanism specifically designed for collective litigation at a time when such concepts were still developing internationally.

The Consumer Protection Code Revolution

The landmark Consumer Defence Code (Law 8.078/1990 – CDC) significantly expanded and refined the collective redress system. It introduced a sophisticated classification of collective rights into three categories: diffuse rights (indivisible rights of undetermined persons connected by factual circumstances), collective rights stricto sensu (indivisible rights of a determined group connected by legal relationships) and individual homogeneous rights (divisible rights arising from a common origin). This tripartite classification remains a distinctive and innovative feature of Brazilian collective litigation, influencing how courts analyse standing, res judicata and remedies.

Integration With Modern Civil Procedure

The Civil Procedure Code of 2015 (CPC/2015) further modernised collective litigation by incorporating provisions on group litigation, creating the “incident of resolution of repetitive demands” (IRDR), and establishing rules for representative appeals. These mechanisms complement the specialised collective action legislation and address mass litigation more efficiently by creating binding precedents that prevent repetitive litigation on identical legal issues.

Policy Drivers Behind the Legislative Regime

The development of Brazil’s collective redress regime was driven by several policy considerations. First, it was recognised that individual lawsuits would be inadequate for addressing mass harm affecting large groups, particularly when individual damages were minimal but aggregate harm was significant. Second, enhancing the efficiency of judicial administration necessitated mechanisms to consolidate similar claims and prevent the proliferation of identical individual lawsuits. Third, ensuring access to justice for claims that would be economically unviable individually became paramount, especially for consumers facing powerful corporate defendants.

Additionally, the system was designed to deter illegal conduct through comprehensive enforcement mechanisms beyond individual suits. Ensuring the protection of fundamental rights enshrined in the 1988 Constitution, particularly consumer rights, environmental protection and cultural heritage, necessitated the implementation of robust collective enforcement mechanisms. Finally, the recognition that certain interests (such as environmental quality and public health) are inherently collective and indivisible necessitates procedural frameworks that differ from traditional bilateral litigation.

Comparative Law Influences

The Brazilian collective redress system draws from a variety of international models, adapted to suit Brazil’s civil law tradition and constitutional framework. The US class action system, particularly Federal Rule 23, provided the foundation for representative litigation and the aggregation of claims. However, Brazilian legislators have adapted these mechanisms, resulting in significant structural and philosophical differences.

Fundamental Differences From the US System

In contrast to US class actions, Brazilian collective actions do not necessitate class certification. There is no preliminary stage in which courts determine whether an action may proceed collectively based on number of claims, commonality, typicality, and adequacy of representation. Instead, the focus is on the legitimacy of the plaintiff entity (is this organisation authorised by law to file collective actions?) and the nature of the rights at stake (are these truly collective rights?). This reflects a fundamentally different approach: the US system focuses on representativeness, while Brazil focuses on institutional legitimacy.

The Brazilian system operates primarily on an opt-out basis for diffuse and collective rights, automatically including all affected parties. However, for individual homogeneous rights, the system establishes an asymmetric res judicata regime where favourable judgments benefit all absent class members, but unfavourable judgments do not prejudice individuals’ rights to file separate actions. This “secondary” res judicata (secundum eventum litis) does not have a direct parallel in US law.

Standing rules also differ dramatically. In the USA, class representatives are typically members of the affected class. In Brazil, entities such as the Public Prosecutor, Public Defender, government agencies and qualified associations bring actions on behalf of affected groups without being members themselves. Individual citizens, even if directly harmed, generally cannot file collective actions individually.

European and Civil Law Influences

Brazilian law draws inspiration from European civil law tradition, particularly regarding the role of the Public Prosecutor (Ministério Público) as a guardian of collective interests. This institution, with its foundation in French and Portuguese legal traditions, has constitutional independence and a mandate to protect social and individual interests that are unavailable. The robust role of public entities in bringing collective actions aligns more closely with civil law traditions than with the adversarial system characteristic of common law.

The inquisitorial aspects of Brazilian procedure, in which judges actively manage cases and may order evidence production sua sponte, also reflect civil law influences. This stands in contrast to the more party-driven discovery seen in common law jurisdictions.

Distinctive Brazilian Features

Several features distinguish the Brazilian system from both US and European models. The tripartite classification of collective rights (diffuse, collective, individual homogeneous) is unique to Brazil and provides a sophisticated framework for analysing different types of collective litigation. The broad legitimacy for public entities to bring collective actions, combined with the mandatory participation of the Public Prosecutor in actions brought by private entities, creates strong public oversight.

The absence of contingency fee restrictions, combined with the exemption of public entities and qualified associations from court costs, creates a different litigation financing landscape than in many other jurisdictions. The “fluid recovery” mechanism, in which unclaimed damages fund projects benefiting affected communities, addresses distribution problems differently than cy-près settlements in the USA.

Not applicable. Brazil is not a member of the European Union and therefore does not implement EU directives. However, Brazilian legal scholars and policymakers monitor EU developments in collective redress as a form of comparative law that may inform future reforms.

The Brazilian collective redress system is governed by a series of complementary statutes that, when taken together, form a comprehensive framework:

Statute 7.347/1985 (Public Civil Action Act – LACP)

This foundational statute establishes the procedural framework for civil actions aimed at protecting diffuse and collective interests. It covers environmental protection, consumer rights, cultural and artistic heritage, urban planning, economic order and other collective interests. The LACP applies to actions seeking injunctive relief, compensatory damages, or both. It establishes fundamental rules regarding standing, jurisdiction, injunctions, damages and remedies. The LACP has undergone several amendments to broaden its scope and modernise its procedures.

Statute 8.078/1990 (Consumer Defence Code – CDC)

The CDC comprehensively regulates consumer relations and includes extensive provisions on collective defence of consumer rights. It established the foundational classification of collective rights into diffuse, collective and individual homogeneous categories, which now applies beyond consumer law to all collective litigation. The CDC’s procedural provisions complement and expand upon the LACP, creating an integrated system. Articles 81–104 specifically address the collective defence of consumer rights, while other provisions establish substantive consumer protections that are frequently enforced through collective actions.

Statute 13.105/2015 (Civil Procedure Code – CPC/2015)

The current procedure code contains provisions applicable to collective actions, including rules on joinder of parties, concurrent jurisdiction and special procedures. Notably, it established the “incident of resolution of repetitive demands” (IRDR), a mechanism to address mass litigation involving repetitive legal issues by selecting representative cases and creating binding precedents. The CPC also oversees representative appeals (recursos repetitivos), with the aim of creating precedents in appellate courts, and it establishes modern case management powers for judges.

Statute 12.529/2011 (Competition Defence Act)

This statute governs antitrust enforcement in Brazil and includes provisions for collective actions seeking damages from competition law violations. It addresses both standalone actions (independent of prior administrative findings) and follow-on actions (based on decisions by the Administrative Council for Economic Defence – CADE). The law co-ordinates administrative enforcement with private litigation, establishing rules on burden of proof, passing-on defence and damages calculation in competition cases.

Statute 13.709/2018 (General Data Protection Law – LGPD)

Brazil’s data protection law, modelled partly on the EU’s GDPR, establishes rights for data subjects and obligations for data controllers. It provides for both administrative enforcement by the National Data Protection Authority (ANPD) and judicial remedies, including collective actions for data breaches and privacy violations. The LGPD is becoming increasingly important for collective litigation involving technology companies and data processors.

Statute 8.429/1992 (Administrative Improbity Act)

This law governs actions against public officials and private parties for acts of administrative misconduct. While these actions centre on issues of corruption and public administration, they frequently serve to protect collective interests and adhere to procedural rules similar to those observed in other collective actions. Recent reforms (Law 14.230/2021) modified the improbity framework while maintaining collective action mechanisms.

Complementary Legislation

Additional statutes address specific sectors or rights, including environmental law (Law 6.938/1981 establishing the National Environmental Policy), protection of children and adolescents (Statute 8.069/1990 – ECA), elderly persons (Law 10.741/2003) and persons with disabilities (Statute 13.146/2015), racial equality (Statute 12.288/2010), and others. Each includes provisions for collective enforcement of the rights they protect.

Consumer Protection

This is the most common and developed area for collective actions. The scope of cases encompasses defective products resulting in physical harm or economic loss, unfair commercial practices, misleading or deceptive advertising, abusive contract clauses in standard-form contracts, banking services disputes (fees, interest rates, contract terms), telecommunications services (service quality, billing errors, unauthorised charges), healthcare plan disputes (coverage denials, contract rescissions), insurance claim denials, product recalls and consumer credit issues. The Consumer Code Act offers streamlined procedures for consumer collective actions, including the possibility of inverting the burden of proof.

Environmental Protection

Collective actions address a wide range of environmental issues: environmental damage to air, water, soil or ecosystems; industrial and urban pollution; deforestation and illegal logging; protection of natural resources and biodiversity; violations of environmental licensing requirements; failure to conduct environmental impact assessments; climate change-related issues; and protection of endangered species. These actions may seek both remediation of damage and compensation for collective environmental harm.

Competition Law and Economic Order

This expanding area involves actions seeking damages from cartels (price fixing, bid rigging), abuse of dominant market position, anti-competitive mergers and acquisitions, and other violations of competition law.

Securities and Capital Markets

Collective litigation involving misrepresentation in securities offerings, prospectus fraud, insider trading affecting multiple investors, violation of disclosure duties by publicly traded companies, market manipulation, and abusive practices by financial intermediaries.

Urban Planning and Housing

Actions involving irregular urban development, housing rights, public infrastructure failures, real estate consumer disputes, irregular subdivisions and violations of city master plans.

Cultural and Historical Heritage

Protection of historical sites and monuments, preservation of artistic heritage, protection of archaeological findings, cultural property disputes and enforcement of preservation obligations. These actions typically involve government entities and civil society organisations dedicated to cultural preservation.

Public Health

Actions seeking access to medications and medical treatments, enforcement of health service standards, public health policy implementation, sanitary surveillance matters and healthcare facility regulation. The Brazilian Unified Health System (SUS) faces a significant number of collective lawsuits regarding access to treatments and medications.

Data Protection and Privacy

This emerging area involves violations of the Data Protection Act, including unauthorised data processing, inadequate security measures leading to data breaches, lack of transparency in data collection, improper cross-border data transfers, and failure to respect data subject rights. As data protection enforcement matures, this area is experiencing rapid growth in collective actions.

Labour and Employment Rights

While labour law has specialised procedures, collective labour rights can be protected through collective actions, particularly when affecting categories of workers or involving violations with collective impact, such as systemic discrimination or widespread violations of workplace safety.

Disability Rights and Accessibility

Actions enforcing accessibility standards in buildings and public spaces, non-discrimination in services and employment, rights of persons with disabilities to education and healthcare, and compliance with inclusive design requirements.

Brazilian law does not use the term “class action” (ação de classe) but rather “collective actions” (ações coletivas) or “public civil actions” (ações civis públicas). The CDC provides the fundamental classification system that defines and categorises collective rights as (i) diffuse rights (Article 81, Paragraph I); (ii) collective rights stricto sensu (Article 81, Paragraph II) or (iii) individual homogeneous rights (Article 81, Paragraph III).

Collective actions in Brazil may be filed before federal or state courts, depending on the subject matter and parties involved. Federal courts have jurisdiction when the Union, federal agencies or federal public companies are parties, or when the case involves international treaties, indigenous rights, human rights of federal interest, or constitutional matters under federal jurisdiction. State courts handle most collective actions, including consumer, environmental and local disputes, as well as actions against states, municipalities or private entities.

Territorial Jurisdiction

Under Article 2 of the LACP, venue is determined by the location where the damage occurred. If the alleged harm is national, the action may be filed in any federal court; if statewide, in any district within that state. The territorial scope of judgments depends on the jurisdictional level – local, state or national.

Specialised Chambers

Some courts, such as the São Paulo Court of Justice, have specialised chambers for collective and diffuse rights. Major cities also have judges with experience in collective litigation.

Initiation

Collective actions require a detailed initial petition identifying parties, establishing standing under the LACP/CDC, classifying the collective right (diffuse, collective or individual homogeneous), and providing specific allegations of fact and legal grounds.

Pre-Action Civil Investigation

The Public Prosecutor can conduct administrative investigations (inquérito civil) prior to filing, gathering evidence through document requests, witness testimony and inspections. Results may lead to litigation, settlement (TAC – see 3.12 Settlement and ADR Mechanisms) or archiving.

Admissibility and Service

Judges conduct an initial review of standing, jurisdiction and procedural compliance. Following admission, defendants have 15 days to file a comprehensive answer addressing all allegations and defences. Uncontested facts are deemed admitted.

Evidence and Case Management

The judge identifies and organises the various pieces of evidence, including documentary evidence, expert reports, witness testimony and inspection reports. Court-appointed experts play a pivotal role in technical matters. Judges actively promote settlement and efficient case progression.

Trial and Judgment

Professional judges (no juries) decide cases after hearings and closing arguments. Judgments specify the collective right type, territorial scope, compliance obligations and enforcement mechanisms.

Appeals

Three are three appellate levels: Appeal (Apelação) reviews facts and law; Special Appeal (Recurso Especial) reviews federal law; and Extraordinary Appeal (Recurso Extraordinário) reviews constitutional issues. Multiple parties may file an appeal, including the Public Prosecutor and interested associations.

Brazilian law restricts the ability of individual citizens to file collective actions, allowing only specific entities to do so. The following are legitimate parties:

Public entities:

• Public Prosecutor (Ministério Público) – primary and most active plaintiff in collective litigation, with a constitutional mandate to protect collective interests.
• Public Defender’s Office (Defensoria Pública) – represents economically disadvantaged groups.
• Federal, state and municipal governments – through their respective executive branches.
• Autonomous government agencies and public foundations – including consumer protection agencies (PROCONs).

Private entities:

• Legally constituted associations – must: (1) have been formally incorporated for at least one year; (2) have institutional purposes related to the subject matter of the action; and (3) demonstrate adequacy of representation.
• Trade unions and professional associations – for matters affecting their members or professional categories.

Key Restrictions

Individual citizens and ad hoc groups lack standing. Standing is verified at filing and throughout proceedings. Associations must prove institutional connection to the disputed matter and organisational capacity. The Public Prosecutor is involved in all collective actions, either as plaintiff or as mandatory intervenor (custos legis), ensuring protection of collective interests.

Class membership in Brazilian collective actions is determined by the type of collective right asserted in the initial petition:

• Diffuse rights: Class includes all persons affected by indivisible harm (eg, environmental damage, consumer safety). Membership is automatic and cannot be opted out of; beneficiaries need not be identifiable at filing.
• Collective rights: Class comprises members of a defined group, category or class of persons linked by a common legal relationship (eg, residents of a neighbourhood, subscribers to a service). Membership is automatic based on group affiliation.
• Individual homogeneous rights: Class consists of victims suffering divisible damages from a common origin (eg, defective product purchasers). Membership is determined by proving individual harm stemming from the collective event.
• Opt-in vs opt-out: Brazilian collective actions operate on an opt-out basis for individual homogeneous rights. Judgments automatically bind all class members unless they expressly exclude themselves. For diffuse and collective rights, there is no opt-out – all affected persons are bound by the judgment (res judicata).
• Class size limits: No numerical limits exist. Classes may encompass thousands or millions of people. The petition must classify the right type and describe the affected group, but need not identify individual members or provide precise figures.

Brazilian procedure allows parties to join ongoing collective actions through intervention mechanisms:

• Intervention by legitimate entities: Any entity with standing to bring collective actions (Public Prosecutor, Public Defender, government entities, qualified associations) may intervene as assistant plaintiffs (litisconsortes ativos) to support the collective claim. Intervention is permitted at any stage before judgment, subject to court approval.
• Mandatory Public Prosecutor participation: When the Public Prosecutor is not the original plaintiff, it must participate as custos legis (guardian of the law), monitoring proceedings and intervening to protect collective interests. This participation is automatic and mandatory.
• Joinder of defendants: Plaintiffs may request joinder of additional defendants during proceedings if they share responsibility for the alleged harm, subject to proper service and opportunity to defend.

Active Judicial Management

The CPC substantially expanded judicial case management powers, transitioning Brazilian civil procedure towards a more active judicial management model while preserving civil law foundations. Judges have both the authority and the duty to manage cases actively.

Procedural Management Powers

The judge acts as the “conductor of the process”, actively managing it rather than passively waiting for party initiatives. This reflects a blend of civil law traditions of judicial protagonism and modern case management concepts.

Evidence Management

In collective actions, judges may order defendants to produce documents and information, even if not specifically requested by plaintiffs, when necessary for adjudication; appoint expert witnesses for technical matters and formulate questions for expert analysis; conduct judicial inspections of locations, facilities or conditions; invert the burden of proof in consumer cases when technical complexity, consumer vulnerability or claim plausibility justifies placing the burden on defendants; and limit discovery to prevent abuse, fishing expeditions or disproportionate burdens.

The burden of proof inversion is particularly significant in consumer collective actions. Article 6, VIII of the CDC allows judges to invert the burden when the claim is plausible (verossímil) or the consumer is hypervulnerable. This shifts the burden to defendants to prove they did not cause harm, rather than requiring consumers to prove causation and fault. This powerful tool reflects the protective philosophy of consumer law and addresses information asymmetries.

Interim Measures

Courts have extensive powers to grant interim relief (tutelas provisórias):

• Preliminary injunctions (tutelas de urgência) to prevent imminent harm or preserve the status quo pending final judgment.
• Asset freezing orders to ensure future enforceability.
• Mandatory conduct orders requiring or prohibiting specific actions.
• Anticipation of final relief (tutela antecipada) when the claim is legally and factually evident but formal judgment will take time.

Interim measures in collective actions often involve orders to cease selling defective products, cease misleading advertising, discontinue harmful environmental practices or maintain public services. These orders have immediate practical impact even before final the judgment.

Settlement Promotion

Judges must actively promote settlement, including scheduling mandatory conciliation hearings before or during proceedings; suggesting settlement terms and facilitating negotiations; referring matters to mediation with the consent of the parties; and approving consent agreements (TAC) when appropriate. In collective actions, settlements require approval by the Public Prosecutor when involved, and the judge evaluates whether the settlement adequately protects collective interests.

Sanctions for Abuse

Courts may sanction parties, attorneys and witnesses for frivolous claims or defences made in bad faith; dilatory tactics designed to delay proceedings; evidence spoliation or destruction; non-compliance with court orders; abuse of procedural rights; and other bad-faith litigation conduct.

Collective actions in Brazil are complex and time-consuming, typically taking many years from filing to final resolution. Based on empirical data and practical experience, their typical duration is as follows.

First Instance (Trial Court)

• Simple cases: 2 to 4 years from filing to first-instance judgment.
• Moderately complex cases: 4 to 7 years.
• Highly complex cases: 7 to 12 years or more.

Factors affecting duration include complexity of factual and legal issues; amount and nature of evidence required (particularly expert evidence); number of parties and attorneys involved; court workload and available resources; party co-operation versus obstruction; and whether interim appeals are filed.

Appellate Level

• Court of Justice/Federal Regional Court: additional 2 to 4 years for appeal review.
• Superior Court of Justice (STJ): additional 1 to 3 years if special appeal is filed.
• Federal Supreme Court (STF): additional 1 to 4 years if extraordinary appeal is filed.

Total duration from initial filing to final, unappealable judgment commonly ranges from 5 to 15 years, though some cases resolve faster through settlement or take longer if procedural complications arise.

Priority Processing

Certain cases receive statutory priority treatment:

• Cases involving elderly persons (over 60 years old) receive priority at all stages.
• Cases involving persons with serious illnesses receive priority.
• Cases involving persons with disabilities receive priority.
• Cases of special constitutional or social importance may receive priority at judicial discretion.

These priorities apply to scheduling hearings, issuing decisions and processing appeals. However, enforcement is inconsistent, and priority cases still face delays, though theoretically shorter than non-priority cases.

Summary Judgment

Courts may grant summary judgment (julgamento antecipado) when there are no genuine disputes of material fact requiring evidence; the legal issue is well established by precedent or clearly determined by law; the evidence is entirely documentary and conclusive; or the parties agree to forgo evidence and submit the case for immediate decision.

However, summary judgment is relatively uncommon in collective actions given their factual complexity and high stakes. Defendants often challenge factual assertions and request evidence production, preventing summary disposition.

Under Article 18 of the LACP and Article 87 of the CDC, all legitimate entities – including the Public Prosecutor’s Office, Public Defender’s Office, government bodies and duly qualified associations – are exempt from the advance payment of court fees, expert fees and other procedural expenses when filing collective actions.

Liability for Costs

Such entities are only liable for costs and attorneys’ fees if they act in bad faith. If the claim is dismissed for lack of evidence or merit without bad faith, no costs are owed.

Scope of the Rule

This exemption applies specifically to collective proceedings governed by the LACP or CDC. If an association acts as a private litigant in an ordinary civil case, general cost rules will apply.

Policy Rationale (Corrected Summary)

Brazilian collective litigation law eliminates financial obstacles by waiving advance costs and limiting liability to cases of bad faith, making collective actions effectively cost-free for good-faith plaintiffs and thereby encouraging public-interest litigation.

No General Discovery System

Brazilian civil procedure does not have discovery in the common law sense. There is no general duty to disclose documents or information, no interrogatories, and no depositions as in US procedure. Parties control what evidence they present, and there is no obligation to produce evidence harmful to their positions.

Document Production Requests

Courts may order production of specific documents upon party request or at the court’s initiative.

Requirements for Document Production

The requesting party must clearly specify the documents or categories of documents sought, not merely describe topics or areas of inquiry; demonstrate relevance to facts at issue in the case; show inability to obtain documents through other means (documents under the opposing party’s or a third party’s control); and establish that the request is proportionate to case needs and not unduly burdensome.

Vague or overbroad requests (“all documents relating to…”) are typically denied. Specificity is required. However, categories of documents may be requested if adequately defined (eg, “all board minutes from January to June 2022 discussing the challenged marketing campaign”).

Judicial Discretion

Courts evaluate production requests considering relevance and necessity to prove facts at issue; proportionality between the burden of production and the information’s value; protection of privacy and confidentiality; protection of business secrets and proprietary information; and constitutional rights to privacy and intimate life.

Judges balance the need for evidence against competing interests. Production orders are common when clearly necessary, but courts protect against fishing expeditions.

Scope of Production

Document production in Brazil is:

• Limited to specific identified documents or defined categories.
• Not a general exploration of the opposing party’s files.
• Subject to judicial control and proportionality limits.
• Focused on documents necessary to prove specific facts in dispute.

The requesting party must explain what facts each document will prove and why other evidence cannot establish those facts.

Electronic Discovery

Electronic documents and communications may be subject to production orders. Courts increasingly recognise electronic evidence including emails, digital documents and spreadsheets, database information, website content, social media posts and messages, and electronically stored information.

Authentication requirements apply, and parties may challenge the authenticity of electronic evidence. Digital forensic experts may be appointed to analyse electronic evidence, recover deleted files or verify authenticity.

Production From Third Parties

Courts may order third parties to produce documents or information relevant to collective actions. This is particularly important for:

• Banking records and financial information.
• Medical records and healthcare information.
• Government documents and administrative records.
• Corporate records from related entities or predecessors.
• Expert reports from consultants.
• Communications with third parties.

Third parties must comply with production orders on penalty of fines, though they may assert privileges or raise objections on valid grounds.

Privilege and Confidentiality

Attorney–client privilege

Communications between attorneys and clients are privileged under Brazilian law (Article 7, II, Law 8.906/1994 – Statute of the Brazilian Bar), extending to:

• Legal advice and opinions.
• Case strategy discussions.
• Documents prepared for litigation purposes.
• Attorney work product and mental impressions.
• Communications facilitating legal representation.

Courts cannot order disclosure of privileged communications. Evidence obtained in violation of privilege is inadmissible and cannot be used even if relevant. Attorneys may refuse to testify about client communications.

Professional secrecy

Other professionals have statutory secrecy obligations that create privileges:

• Physicians and healthcare providers: Medical information and patient communications are privileged.
• Accountants: Client financial information may be privileged.
• Psychologists and therapists: Treatment information is privileged.
• Journalists: Source protection privilege.
• Religious advisers: Confession and spiritual guidance are privileged.

These privileges may be invoked to resist production requests, though courts may require disclosure in limited circumstances when privilege is overcome by compelling need.

Business secrets and confidential information

Commercial and industrial secrets receive legal protection (Article 195, Law 9.279/1996 – Industrial Property Law). When disclosure is necessary for litigation, courts may:

• Order confidential treatment with access limited to attorneys, experts and the court.
• Permit redaction of particularly sensitive information not necessary for the case.
• Conduct in camera review to determine whether information must be disclosed.
• Impose confidentiality obligations on persons accessing sensitive information.
• Limit use of disclosed information to the specific litigation.

Requests for confidentiality must specify the information to be protected and provide a concrete justification. Broad or unsupported assertions of confidentiality are insufficient.

Sanctions for Non-Compliance

Failure to comply with production orders may result in:

• Daily fines (astreintes) accruing until compliance.
• Adverse inferences that facts the documents might prove are admitted.
• Reversal of burden of proof on issues the documents address.
• Contempt sanctions including higher fines.
• In extreme cases, presumption that the opposing party’s allegations about the documents’ contents are true.

These sanctions incentivise compliance while addressing situations where parties refuse production despite valid orders.

Burden of Proof

Generally, parties bear the burden of proving facts supporting their claims or defences (Article 373, CPC). Plaintiffs must prove facts establishing rights they assert; defendants must prove facts supporting defences or counterclaims.

However, in consumer collective actions, courts may invert the burden of proof (Article 6, VIII, CDC) when:

• The claim is plausible (verossimilhança) based on allegations and available evidence.
• The consumer is hypervulnerable due to age, health, education or other factors.
• Technical complexity makes proof unduly difficult for consumers while defendants have ready access to information.

Burden inversion is a powerful tool addressing information asymmetries in consumer litigation. When the burden is inverted, the defendants must prove they did not cause harm rather than the consumers having to prove causation and fault.

Brazilian collective actions may seek diverse remedies, often combining multiple types in single actions.

Injunctive Relief

Prohibitory injunctions

Prohibitory injunctions are orders requiring defendants to cease illegal conduct, for example:

• Cease manufacturing or selling defective products.
• Cease misleading or deceptive advertising.
• Discontinue unfair commercial practices.
• Cease environmental violations (pollution, deforestation, illegal activities).
• Halt anti-competitive conduct (cartel activities, abuse of dominance).
• Cease privacy violations or unauthorised data processing.

Prohibitory injunctions are common in consumer and environmental collective actions, addressing ongoing violations.

Mandatory injunctions

Mandatory injunctions are orders requiring affirmative conduct, for example:

• Recall defective products from the market.
• Implement safety measures or warnings.
• Provide information and disclosures to consumers.
• Restore environmental damage.
• Modify contract terms or practices.
• Implement compliance programmes.
• Provide access to services or facilities.

Mandatory injunctions often require ongoing compliance and monitoring. Courts may appoint monitors or require periodic compliance reports.

Structural injunctions

In complex cases, courts may order comprehensive structural changes to defendants’ operations, including ongoing monitoring, compliance reporting, third-party oversight, systematic reforms to policies and procedures, and training programmes for employees. Structural injunctions are more common in cases involving systematic violations or when simple prohibitory/mandatory orders are insufficient to address problems.

Monetary Relief

Compensatory damages are compensation for losses suffered collectively or by individual members, for example:

• Economic losses (lost money, property damage, out-of-pocket expenses).
• Lost profits and consequential damages.
• Costs of remediation or correction.
• Expenses incurred due to violations.

Settlements in Collective Actions

Settlement is strongly encouraged throughout Brazilian collective litigation, with courts actively promoting consensual resolution.

Consent agreement (Termo de Ajustamento de Conduta – TAC)

The TAC is a distinctive Brazilian mechanism with no direct foreign equivalent, created by Article 5, §6 of the LACP.

Nature and function

The TAC is an extrajudicial agreement entered into before litigation (or to terminate pending litigation) between defendants and legitimate public entities, typically the Public Prosecutor. It constitutes an enforceable title equivalent to a court judgment without requiring judicial approval, though courts may approve TACs to terminate pending litigation.

Key features

The agreement must include specific obligations the defendant commits to; compliance deadlines for each obligation; periodic penalty payments (astreintes) for non-compliance with specific obligations; monitoring and reporting mechanisms; and often payment of fluid recovery contributions for past violations.

TACs are negotiated between the parties. The Public Prosecutor or other public entity investigates violations, discusses remedial measures with defendants and formalises agreements through signed instruments.

Effects

TACs create immediately enforceable obligations – if breached, the beneficiary may directly execute against the defendant’s assets without filing a lawsuit to establish breach. They avoid litigation costs and delays for both parties and may include monetary payments, conduct obligations, or both. They have res judicata effects, preventing relitigation of resolved issues.

TACs are particularly valuable for resolving environmental violations, consumer protection issues, urban planning violations, and other matters where negotiated remediation may be preferable to prolonged litigation.

Judicial approval requirements

When entered into before litigation, a TAC does not require judicial approval and is immediately enforceable. When entered into to settle pending litigation, court approval is required. The judge evaluates whether its terms adequately protect collective interests.

Judicial settlements

Parties may settle collective actions at any stage. Settlement requires agreement between plaintiff and defendant; participation of the Public Prosecutor if involved as party or custos legis; and judicial approval after evaluation of terms.

Judicial approval process

The court evaluates whether the settlement protects collective interests; whether its terms are fair, reasonable, and sufficient to remedy violations; whether affected parties received adequate notice of the proposed settlement; and the Public Prosecutor’s opinion (mandatory, as the Public Prosecutor must opine on settlement adequacy).

The judge may reject settlements deemed inadequate or contrary to public interest. Unlike private bilateral contracts, collective action settlements require judicial scrutiny to ensure collective interests are protected, as settlors are not the actual beneficiaries.

Alternative Dispute Resolution

Mediation

Mediation is increasingly used in collective disputes. Court-annexed mediation programmes are expanding, with trained mediators facilitating negotiations. Mediation is effective in multiparty environmental disputes, consumer cases involving ongoing relationships, and matters where negotiated solutions may better address interests than adjudicated outcomes.

Mediation may occur pre-litigation during civil investigations or during proceedings when courts refer cases to mediation. Parties may voluntarily seek private mediation. The CPC encourages mediation and requires court mediators to be available.

Conciliation

Conciliation hearings are common and often mandatory in civil cases. A judge or court conciliator oversees negotiation, focusing on specific settlement proposals. Conciliation is more directed than mediation, with conciliators proposing terms and encouraging parties to accept reasonable offers.

In collective actions, conciliation hearings typically occur early in proceedings and may be repeated at later stages. While success rates vary, many cases are settled through conciliation.

Arbitration

Arbitration is typically unavailable for collective or diffuse rights, and even individual consumer claims of a homogeneous nature are usually non-arbitrable under consumer protection rules.

Arbitration may nevertheless be employed in corporate collective disputes among shareholders or other commercial matters where arbitration agreements exist and the rights are subject to party disposition. It may also be used to enforce collective judgments regarding individual claims, if the parties consent.

Public Civil Action Settlement Programmes

Certain courts and Public Prosecutor offices have established specialised settlement programmes for collective actions, promoting early resolution through structured negotiation, pre-litigation settlement conferences and dedicated mediators with expertise.

Nature of Judgments

Judgments in collective actions may be declaratory (establishing rights, legal relationships or interpretation of laws); constitutive (creating, modifying or extinguishing legal relationships); condemnatory (condenatório) (imposing monetary or conduct obligations); or mandatory (mandamental) (ordering specific conduct with immediate enforceability through coercive measures). Many collective action judgments combine multiple types, declaring rights while imposing conduct and monetary obligations.

Binding Effect and Res Judicata

Brazilian res judicata rules vary significantly by type of collective right and case outcome:

Diffuse and collective rights:

• If plaintiff wins – judgment binds erga omnes (everyone) nationwide, preventing relitigation.
• If plaintiff loses – judgment binds erga omnes only if dismissal is on the merits with sufficient evidence. New actions arising from same facts are precluded.
• If dismissed for insufficient evidence – no res judicata effect; another legitimate entity may refile with new evidence.

Individual homogeneous rights:

• If plaintiff wins – judgment binds erga omnes (all class members can liquidate individual damages).
• If plaintiff loses – no binding effect on individual class members (secundum eventum litis rule). Individuals may still pursue separate lawsuits for their own damages.
• Individual class members who filed their own lawsuits before collective judgment may opt out and proceed independently.

The secundum eventum litis doctrine protects individual rights – unfavourable collective judgments do not prevent individuals from seeking justice, while favourable judgments benefit all class members.

The most distinctive feature of Brazilian collective actions is the variable res judicata regime depending on the type of collective right involved, as established in Article 103 of the CDC.

Enforcement of Collective Judgments

Diffuse and collective rights

Execution is collective – orders are enforced against defendants to benefit entire groups. Environmental restoration benefits everyone in the affected area. Injunctive orders protect all affected persons. Monetary awards go to fluid recovery funds if not specifically allocated to identified victims.

The legitimate entity that brought the action typically supervises execution, ensuring compliance with the judgment and pursuing enforcement if defendants fail to comply voluntarily.

Individual homogeneous rights

Execution occurs in two distinct phases:

• Phase 1: Collective judgment establishing liability: The judgment determines the defendant’s liability and establishes general criteria for calculating individual damages. It does not quantify specific amounts for each victim but creates the framework for individual quantification.
• Phase 2: Individual liquidation and enforcement: Individual victims may file individual execution proceedings (liquidação e execução individual) to quantify their specific damages using the criteria established in the judgment; prove their individual losses and circumstances; and collect their individual awards from the defendant. This process allows individualised recovery while avoiding the need to relitigate liability, which the collective judgment established definitively.

Collective enforcement option

If individual victims do not seek enforcement within one year after the judgment becomes final or after the publication notifying them of their rights (whichever occurs later), authorised entities (particularly the Public Prosecutor) may initiate collective enforcement to recover global damages for distribution to victims who come forward.

This collective execution uses procedures similar to class distribution in US settlements, with claims administration and distribution to eligible claimants.

Fluid recovery

Unclaimed amounts after a reasonable time for victims to come forward are deposited in fluid recovery funds for projects benefiting the affected community or similar collective interests; for example, unclaimed consumer damages fund consumer education, unclaimed competition damages fund market regulation and unclaimed environmental damages fund conservation.

This mechanism ensures defendants do not benefit from violations merely because individual victims fail to claim compensation.

Enforcement Mechanisms

Law 13.105/2015 (Article 139, X, CPC) requires a National Registry of Collective Actions (Cadastro Nacional de Ações Coletivas), though implementation has been slow. The registry aims to provide publicity about pending and decided collective actions; prevent conflicting judgments by informing courts of related actions; inform potential beneficiaries of pending actions; and facilitate co-ordination among courts handling related matters.