Aviation Finance & Leasing 2024 Comparisons

Last Updated July 23, 2024

Contributed By Basch & Rameh

Law and Practice

Authors



Basch & Rameh was founded in 2000 and specialises in international transactions, mainly project, corporate and asset-based finance (aircraft, vessels and oil rigs). It also focuses on corporate law matters, technology, foreign investment in Brazil, litigation and arbitration, representation of Brazilian companies with foreign investments, joint ventures, banking, insurance, shipping, aeronautical and maritime law. Clients are foreign companies with interests in Brazil, and Brazilian companies with interests abroad. The firm is headquartered in São Paulo and opened a branch office in Rio de Janeiro in 2011. The team comprises 11 attorneys who all have extensive experience of both domestic and international matters across a broad range of legal subjects.

No taxes are due based on the execution of a sale agreement for an aircraft or engine. Taxes may become payable upon the completion of a sale, depending on the circumstances (eg, if the buyer or seller is Brazilian or an individual, or if the seller has realised a capital gain). Capital gains rates vary from 15% to 25%. If neither the seller nor the buyer is Brazilian but the aircraft is located in Brazil, capital gains tax might be due; however, the tax authorities have not assessed capital gains on sales since 2004.

There is no clear definition of “location of the aircraft‟ for capital gains tax purposes. It might refer to a physical location or include any aircraft registered on the Brazilian register. Neither the sale of corporate interests in non-Brazilian special purpose vehicles that hold title nor the sale of beneficial interests in owner trusts is subject to tax.

In most cases, sale agreements between non-Brazilian parties do not need registration for purposes of admissibility and enforceability. For formalities related to Brazilian buyers, see 2.3.8 Requirements for Documents Concerning Registration.

Although sale agreements usually do not require registration, bills of sale do (see 1.2.1 Transferring Title).

To transfer title to an aircraft, a bill of sale must be registered with the Brazilian Aeronautical Registry (RAB). An aircraft is presumed to include engines and parts, unless the bill of sale expressly indicates otherwise. To transfer title to a spare engine, registration of a bill of sale with the RAB is advisable but not required. Auxiliary power units (APUs) and other parts require written documentation; however, RAB registration is not possible. The sale of an ownership interest in an entity that owns an aircraft or engine would not alter the details of its registered owner.

When aircraft are owned by owner trusts, the trust agreement, including amendments, must be submitted to the RAB, although such agreements are not registered and do not fall into the public domain. Aircraft bills of sale must follow the requirements listed in 2.3.8 Requirements for Documents Concerning Registration. In addition, bills of sale must be:

  • executed by each of the seller, buyer and two witnesses; and
  • notarised or digitally signed on the execution date.

Due to the special notarisation requirement, the practice of signing and delivering undated bills of sale to be held in escrow does not usually work in Brazil.

The Brazilian Aeronautical Code stipulates that rights in rem over aircraft are governed by the nationality of an aircraft. Consequently, aircraft bills of sale governed by New York or English law might not effectively transfer title; see 1.2.1 Transferring Title.

See 1.2.1 Transferring Title.

Depending on the gross revenues of the seller and buyer, the approval of the Brazilian antitrust authority might be required; see 1.2.1 Transferring Title.

No taxes or duties are payable for the execution and registering of bills of sale. Nominal translation costs will be due.

Note that most registration services have been made free of charge by the National Agency of Civil Aviation (ANAC) as part of an ongoing federal programme to reduce bureaucracy.

There are no express limitations based on the lease type. Dry, wet, operating and finance leases are all permitted in Brazil, provided they abide by importation, registration, foreign exchange and other applicable Brazilian law regulations. There are restrictions on operators in Brazil, so cross-border wet leases are rare.

Due mainly to tax considerations, most commercial aircraft are on operating leases. Local airlines occasionally enter into financial leases, and some spare engine finance is structured through mortgages.

Leases governed by foreign law are recognised and enforced in Brazil, provided they do not violate Brazilian sovereignty, good customs or public morality. Typically, aircraft finance documents do not violate these criteria, with the exception of:

  • self-help remedies; and
  • unilateral option provisions in certain cases (eg, provisions subject to the sole discretion of the lessor).

There are no material restrictions on lessees making rent payments to foreign lessors, but there are foreign currency exchange controls in certain types of transactions (see 2.1.4 Exchange Controls).

Brazil continues to be subject to foreign exchange controls. For decades, lessees have been required to register the terms of all leases with the Brazilian Central Bank, except for leases with terms of less than 360 days. In early 2023, the Central Bank eliminated the requirement for the registration of operating leases. Central Bank registrations are still required for finance leases and other financial acquisition transactions (eg, mortgage financing).

The Central Bank registration is commonly referred to as an “ROF”. ROFs include the amount the debtor may remit and the party to whom the remittances may be made.

ROFs approve regularly scheduled payments due under the finance lease or loan agreement. Irregular payments such as default interest or damages must be approved by the Central Bank on an ad hoc basis before remittance.

Payees under all leases (including operating leases) or loan agreements (including the current or future holders of registered security interests) are obliged to obtain taxpayer registration numbers from the Brazilian Revenue Service (SRF), even though lessors may not be subject to Brazilian tax. Such numbers are called CNPJs. Obtaining a CNPJ does not create tax liability per se.

Since 2016, the process of obtaining a CNPJ requires the registrant to:

  • appoint an agent in Brazil to undertake the process from the SRF; and
  • identify its ultimate beneficial owner to the SRF.

This process can be expensive and time-consuming. When aircraft are leased through trusts, the trustee must have a CNPJ number. Prior to 2016, the process was simpler and did not require compliance with these requirements.

Nominal local fees apply to notarisation. It is customary for Brazilian airlines to bear the costs of registering leases; see 1.2.5 Taxes/Duties Payable Upon Execution of a Bill of Sale.

Except for the CNPJ requirement mentioned in 2.1.4 Exchange Controls, there is no prior qualification or licensing requirement for lessors in Brazil to do business with a local lessee.

The Aeronautical Code requires a description of the aircraft, confirmation of the registry (which must be Brazil for Brazilian operators), the amount of rent and other charges, the lease term and whether there are purchase or extension options. These terms tend to be included in most New York and English law leases.

Gross-up provisions are permissible and enforceable.

On 31 December 2021, the President issued an Executive Order (later converted into a Law in May 2022) re-establishing the 0% rate on rents paid from 1 January 2022 until 31 December 2023, and established the following progressive tax rates:

  • 1% from 1 January 2024 to 31 December 2024;
  • 2% from 1 January 2025 to 31 December 2025; and
  • 3% from 1 January 2026 to 31 December 2026.

At the time of writing, the applicable rate is 1%.

Many different import-related taxes are reduced to zero for commercial aircraft on operating leases, including:

  • federal import tax;
  • federal excise tax; and
  • state circulation of goods and services tax (similar to VAT).

Another tax on imports called “COFINS” did not apply to aircraft imports in prior years. In late 2021, the government passed a law imposing the COFINS tax at the rate of 1%, currently effective until 31 December 2027.

Operators regularly check the jurisdictions of the lessors or other finance providers, as the treatment given to payments to lessors/creditors located or established in “tax havens” (defined as jurisdictions with annual corporate income tax rates under 20%) may be subject to higher withholding tax. The SRF also publishes a list of countries (currently including Ireland) that are deemed to be tax havens.

A lease may include parts installed or replaced during its term. Leases should be precise in determining when replacement parts and engines become subject to a lease. Whenever an engine or APU is replaced, the lease should be amended, and that amendment should be registered with the RAB.

Brazil does not adhere to the concept of title annexation of engines installed on airframes. Nonetheless, leases should be exact in determining if and when the title is removed and replacement engines transferred.

Brazil is a civil law country and the concept of a trust, as found in common law jurisdictions, is foreign to the Brazilian legal system. Brazil is not a party to the 1986 Hague Convention on Trusts.

However, the RAB and other Brazilian agencies are familiar with trust structures, and aircraft may be registered in the name of and leased by owner trustees. The trustee is considered the owner for all legal purposes. The trust beneficiary would have no registered interests in the aircraft. Owner trusts have been and continue to be commonly used with aircraft registered in Brazil. Since 2013, ANAC has required parties using owner trusts to submit copies of the trust agreements to the RAB. The filing is for ANAC’s internal purposes only, and trust agreements do not fall into the public domain.

In bankruptcy proceedings, airline debtors have occasionally confused the individuality of trusts and lumped together the aircraft held by a particular owner trustee. These misunderstandings have been resolved without difficulty. Commencing in late 2020, trust agreements relating to aircraft on operating leases must also be filed with the Brazilian customs authorities.

The RAB is an owner register, and the registration of the name of an aircraft owner confers title to an aircraft. When an aircraft title transfer occurs, registration with the RAB is necessary to perfect it. A lessor’s interest under a lease with a Brazilian operator must be noted through the registration of the lease.

The RAB has no nationality requirements. Foreign owners of Brazilian-registered aircraft should always be registered. The RAB registers the respective interests of owners, lessee operators and mortgagees (when applicable).

The RAB organises its register on a per aircraft basis. It also maintains engine registers, but this applies mainly to spare engines. In respect of engines, the RAB registers contracts and documents, rather than the object itself.

Aircraft lease agreements executed by a Brazilian operator with respect to a Brazilian-registered aircraft must be filed with the RAB for registration. The Brazilian Aeronautical Code provides that if an aircraft lease or, if applicable, a sublease is not registered with the RAB, the lessor, sublessor and sublessee shall be liable for any damages and losses caused by the aircraft. Assuming an aircraft lease is registered, the lessor should not be liable for operations.

Aircraft leases are not subject to any consent from government entities; however, the RAB assesses whether an aircraft lease meets the requirements listed in 2.3.8 Requirements for Documents Concerning Registration. If not, the RAB may refuse to register the lease or may ask the parties to arrange for the missing formalities to be completed.

Leases do not need to be in any specific form. Since leases must be registered with the RAB, they must be translated and comply with the requirements listed in 2.3.8 Requirements for Documents Concerning Registration.

There are no fees to register leases with the RAB.

Aircraft habitually based in Brazil are typically Brazilian-registered. Brazilian carriers have generally been required to operate Brazilian-registered aircraft. Recently, however, ANAC allowed the registration of interchange agreements (increasingly referred to as sublease for hours agreements) for aircraft with foreign registration marks where the interchangee is Brazilian. Aircraft interchange agreements between air carriers based in different states must be approved by each relevant civil aviation authority through a bilateral agreement.

General Requirements

In order to be admissible in Brazilian courts and governmental agencies, any agreement that is not written in Portuguese or that is executed abroad must adhere to the following formalities:

  • it must be notarised and, if executed outside Brazil, apostilled (if signed in a state that is a signatory to the Hague Convention Abolishing the Requirement of Legalisation for Foreign Public Documents);
  • it must be translated into Portuguese by a public translator in Brazil (called “sworn” translations); and
  • it must be registered with a public registry.

A document that is signed in a jurisdiction that does not adhere to the Hague Convention must be legalised by a Brazilian Consulate abroad.

To simplify and expedite RAB filings, most leases, bills of sale, security assignments (including notices and acknowledgements of assignments) and subordination agreements are signed in Brazil by local attorneys who are authorised to execute transaction documents under powers of attorney. The powers of attorney must comply with the formalities described above.

RAB Requirements

The foregoing are general rules for admissibility. The RAB recently abolished its longstanding requirement that registration documents must be signed by two witnesses. In practice, many documents are still witnessed for other reasons.

The RAB accepts documents that are digitally signed, provided that these signatures comply with the technical standards of ICP-Brasil (a cryptographic platform developed by the Brazilian Institute of Information Technology). Documents digitally signed and compliant have the same authenticity value as notarised documents (the digital user must obtain a digital certificate embedded in a USB token issued by ICP-Brasil). The implementation of digital signatures is not recent, but its usage increased throughout the pandemic.

Documents that have not been signed with signatures that are compliant with the ICP-Brasil can be registered with the RAB, but such documents must undergo an authentication process that adds unnecessary cost and delay to transactions.

The RAB filing system for commercial aircraft is also electronic, allowing parties to file aircraft documents for registration remotely.

Other Brazilian Registration Requirements

In addition to the RAB, there is another relevant type of registry, called a Registry of Deeds and Documents (RTD). Unlike the RAB, which is a singular specialised aircraft register, many RTDs in Brazil deal with documents of any nature. There is ongoing debate in Brazil concerning the need to register a RAB-registered document with an RTD. The majority view seems to accept that RAB registration is sufficient.

Not all aviation-related documents are registered with the RAB. Bills of sale, leases, local law mortgages and related amendments must be registered. Lease security assignments, notices and acknowledgements of assignment may also be registered. Documents not registered with the RAB should be registered with an RTD to be enforceable in Brazil.

See 2.2.2 Tax and Withholding Gross-Up Provisions regarding the withholding tax applicable since 2022. The Brazilian lessee is responsible for withholding and paying such tax when remitting the rent payments. The withholding is usually accomplished automatically by the bank handling the wire transfer.

Foreign lessors are not deemed tax residents in Brazil, although they must obtain Brazilian corporate identification numbers to enable the Brazilian lessee to remit rent abroad (see 2.1.4 Exchange Controls). Applicable Brazilian taxes, if any, would be imposed on the Brazilian lessee.

A lessor would not be liable in respect of aircraft or engine maintenance and operations if the lease was registered as described in 2.3.4 Registration of Leases With the Domestic Aircraft Registry.

When financing an asset on a lease, a foreign aircraft or engine owner, lessor or financier would not be liable under the doctrine of strict liability as a result of damage or loss caused by the asset, provided the lease has been registered as described in 2.3.4 Registration of Leases With the Domestic Aircraft Registry.

The lessee’s indebtedness does not apply to an asset that belongs to a third party.

However, from time to time, airport authorities in Brazil have threatened to impose a lien or hold leased aircraft grounded for overdue and unpaid airport charges; see 3.3.1 Third-Party Liens.

Generally, owners’ or lessors’ interests have not been subordinated to third-party interests, with the possible exception of tax, airport and air traffic control authorities (see 3.3.1 Third-Party Liens).

Brazilian operators must purchase primary insurance from Brazilian underwriters.

The Brazilian Aeronautical Code states a minimum obligatory level of liability insurance, which does not meet industry standards. Lease agreements usually require industry-standard cover to complement the statutory insurance.

A minimum of 40% of all reinsurance risks must be offered by Brazilian primary insurers to Brazilian-based reinsurers (who typically take considerably less).

Cut-through clauses are valid only if the primary insurer is insolvent. Otherwise, proceeds must be processed through the primary underwriter. Nevertheless, cut-through clauses are common in aviation insurance policies.

Assignments of insurance/reinsurance are permitted in relation to aircraft leases or finance agreements. Increasingly, parties rely on loss beneficiaries named in policies in lieu of assignments.

Upon an event of default under a lease agreement, the lessor has the right to exercise remedies provided thereunder, including, without limitation, terminating the lease. This right is covered by the Brazilian Civil Code, the Code of Civil Procedure and the Cape Town Convention (Articles 10 and 13). Termination must be preceded by a notice of default extending a last opportunity to cure the default. Subsequently, if the lessee does not remedy the event of default, a new notice should be sent, unilaterally terminating the lease agreement.

Other than the irrevocable deregistration and export request authorisation (IDERA), self-help remedies are not valid or enforceable in Brazil. If an operator does not voluntarily tender the aircraft in Brazil, then a lessor would have to file a lawsuit seeking repossession. If the aircraft is physically located in another jurisdiction, then the repossession rules of that jurisdiction might apply for the taking of physical possession.

Since the implementation of the Cape Town Convention, it has been important to separate the deregistration and exportation processes. For deregistration through IDERAs, ANAC acts expeditiously and issues the deregistration confirmation within five working days. For the exportation process, the tax authorities have never issued regulations relating to export clearances. Therefore, export authorisation must be considered on a case-by-case basis.

There are no restrictions on a lessor’s ability to sell the aircraft following termination of the lease; however, a sale would not necessarily relieve the buyer of export authorisation requirements.

Aircraft do not need to be physically located in Brazil for deregistration purposes.

If a lessor requires a certificate of airworthiness for export to the next jurisdiction of registration, it must be obtained prior to deregistration.

See 2.6.1 Restrictions on Lessors’ Abilities.

No specific specialised courts decide aviation disputes and enforcement, which are adjudicated in state courts in Brazil as disputes between private parties.

A summary judgment is possible but rare in Brazil, and almost unheard of in aircraft repossession cases. It is common to obtain an interim repossession order quickly if the lease default is objectively demonstrated. These orders are not equivalent to summary judgments because they are issued before the lessee has had an opportunity to present a defence. According to Brazil’s Cape Town Convention Declarations, lessors are entitled to “speedy relief”, defined as ten working days.

In theory, a pre-judgment attachment for a monetary award based on a lease default should be possible, but they have only been sought or obtained by a lessor in a small number of cases.

Brazil’s declarations to the Cape Town Convention reinforce the principle of the parties’ contractual freedom to elect the governing law for lease agreements.

Likewise, a submission to a foreign jurisdiction should be binding and upheld by domestic courts. Notwithstanding the Cape Town Convention’s express recognition of exclusive jurisdiction for certain disputes, it is not clear whether the Brazilian judiciary would stay a similar action first filed abroad. The procedure to enforce foreign judgments (described in 2.6.6 Domestic Courts’ Recognition of Foreign Judgments/Awards) is slow and rarely appropriate in aircraft lease disputes.

In June 2024, the Brazilian Code of Civil Procedure was amended to stipulate that courts adjudicating contractual disputes should have a relationship to the parties or the location where the contractual obligations are to be performed. This requirement of a contact is contrary to the terms of Article 42 of the Cape Town Convention, which expressly provides that parties’ freedom to elect a jurisdiction is complete regardless of whether the venue has a relationship to the transaction.

Most aircraft leases include exclusive or non-exclusive elections of courts located in New York or England to resolve disputes. Under the new drafting of the Brazilian Code of Civil Procedure, it is possible that a Brazilian court might not recognise the validity of such a choice if none of the parties is domiciled or otherwise located in New York or England (as applicable), or if none of the contractual obligations, such as payments, are due to be performed in the chosen jurisdiction.

Considering that the Cape Town Convention is a specific law intended to apply narrowly to particular types of aircraft contracts, its terms should have primacy over the new law. However, as the change is still very recent, there have not yet been any tests to determine how Brazilian courts might consider the applicability of the new provisions of the Code of Civil Procedure to aircraft agreements.

See also 2.6.11 Lessees’ Entitlement to Claim Immunity.

A foreign judgment will be valid in Brazil only after ratification by the Superior Court of Justice. The procedure does not re-examine a judgment's merits, provided it meets the following formal requirements:

  • compliance with formalities under the laws of where it was rendered;
  • proper service of process on the parties or after sufficient evidence of the parties’ absence, pursuant to applicable law;
  • not subject to appeal;
  • not conflicting with Brazilian sovereignty, public policy or morality;
  • apostilled or authenticated by the competent Brazilian Consulate and accompanied by a sworn translation into the Portuguese language; and
  • not covering any matter over which the Brazilian judiciary has exclusive jurisdiction.

An urgent interlocutory decision given by a competent foreign court against a Brazilian entity would be recognised and accepted by the Brazilian courts without re-trial or examination of the merits after ratification by a federal court with proper jurisdiction, provided these formal requirements (except for not being subject to appeal) are met.

Judgments can be rendered in foreign currency; however, defendants are entitled to satisfy such judgments by effecting payments in Brazilian currency at the exchange rate effective on the payment date. The foreign plaintiff needs to withdraw the amount in Brazilian currency and request authorisation from the Central Bank to wire the funds in foreign currency. Due to currency fluctuations, it is possible for there to be a discrepancy between the amount awarded and the amount finally wired.

Charging rent following the redelivery of an aircraft might be deemed unenforceable. Damages, however, should be enforceable.

No taxes are due in connection with lease enforcement, but there are court filing fees and bond requirements; see 2.6.13 Other Relevant Issues. In addition, the need for many services might arise, with significant expenses. For example, a customs broker might be needed to obtain an export authorisation. Aircraft parking fees and ground maintenance costs during litigation would be for the account of the lessor from the date of repossession. The legal fees can be significant.

To terminate a lease, a lessor must give a lessee written notice in a manner that complies with the lease and local law. In most cases, the notice should give the lessee a cure period of not less than two business days.

No commercial airlines or air taxi companies currently operating in Brazil are entitled to immunity.

Brazil adopted the New York Convention through Decree No 4.311 of 23 July 2002. However, foreign arbitration awards must still be ratified – see 2.6.6 Domestic Courts’ Recognition of Foreign Judgments/Awards.

Non-Brazilian plaintiffs seeking to enforce a lease in Brazil must file a bond in the court set by the judge, usually of between 10% and 20% of the cause of action’s value. This bond is intended to cover opposing counsel’s fees should the plaintiff lose the action. Court filing fees equivalent to 1% of the action’s value are also due. The Cape Town Convention allows parties to waive bond requirements.

Under Brazilian contractual law, the concepts of assignment and novation are recognised and habitual in aviation transactions involving aircraft on lease to Brazilian lessees.

Both a New York law assignment assumption agreement and an English law novation would be valid and upheld (see 2.3.8 Requirements for Documents Concerning Registration).

See 2.3.8 Requirements for Documents Concerning Registration.

Lease assignments, assignment assumption agreements and novations relating to aircraft must be registered with the RAB. Similar agreements relating to spare engines may be registered, but registration is not required. Failure to complete registration causes the document to be inadmissible in Brazilian courts or other governmental offices.

See 2.3.8 Requirements for Documents Concerning Registration, 1.2.4 Registration, Filing and/or Consent From Government Entities and 2.7.6 Recognition of Transfer of Ownership Interests regarding possible antitrust authority authorisation required for an aircraft sale that might be connected to an assignment assumption agreement or novation.

No taxes or duties arise in connection with an assignment assumption agreement or novation. There are translation costs. There is no consequence to an original or copy of any document being brought into Brazil per se.

Except for antitrust considerations regarding the sale (see 1.2.4 Registration, Filing and/or Consent From Government Entities), the transfer of ownership of an owner entity would not require any particular registration or disclosure to the RAB.

Brazilian operators usually obtain deregistration over leased aircraft. The current basic requirements to export and deregister an aircraft, upon either the expiration or termination of a lease, are as follows:

  • a termination agreement or relevant court order;
  • a single export registration issued by the customs authority (called a “DU-E”; see 2.8.12 Aircraft Export Permits/Licences);
  • the return of the original register and airworthiness certificates issued by the RAB;
  • certification from the authorised party that all prior interests against the object have been discharged or that interest holders have consented to the deregistration and export; and
  • a certificate showing that the aircraft has no amounts due in terms of taxes, expenses and airport fees.

It is also possible for the authorised party under an IDERA to request deregistration. IDERAs must be granted in accordance with Cape Town Convention terms and registered with the RAB. ANAC has promulgated procedures for exercising IDERAs and regularly honours them, even in cases of opposition from a Brazilian lessee. Some of the documents listed above are waived when deregistration is obtained pursuant to an IDERA.

If no IDERA has been granted, a lessor may try to deregister by applying to ANAC and demonstrating that the circumstances of the request are similar to those of an IDERA. The Brazilian Aeronautical Code stipulates that owners have the right to deregister aircraft, but deregistering aircraft without IDERAs is less certain and a Brazilian court order confirming the leasing terminated and deregistration might become necessary.

If the receiving aviation authority requires an export certificate of airworthiness, the lessor must obtain it prior to filing the deregistration request.

Deregistration through the use of an IDERA does not require lessee or operator consent. Authorised parties under IDERAs can also grant certified designee confirmation letters (CDCLs) to other parties, such as a mortgagee. For a mortgagee that is not an authorised party under an IDERA or a CDCL, it is advisable for an acknowledgement of assignment to extend to the mortgagee the ability to enforce the rights of the lessor against the lessee (see 2.3.8 Requirements for Documents Concerning Registration).

An IDERA registered with the RAB is required so that an authorised party is able to deregister an aircraft. The applicant signing the deregistration request will need evidence of being appointed to act for the authorised party.

If deregistration is requested by an operator, approximately two weeks are necessary to conclude deregistration. Using IDERAs, aircraft are typically deregistered within five business days. In accordance with the Cape Town Convention, the RAB will request evidence of the consent of any superior lien holders to confirm the deregistration process. If a lessor, owner or mortgagee is required to file a lawsuit, the period is less certain.

ANAC does not provide specific assurances as to the prompt deregistration of the aircraft. Deregistration pursuant to IDERAs is expressly covered in published ANAC regulations.

There are no fees applicable for the deregistration of an aircraft.

Since 2014, when the effectiveness of IDERAs was established, deregistration powers of attorney (DPOAs) have become less common in Brazil. They are valid in principle, but the five days stipulated for IDERAs might not apply.

See also 2.3.8 Requirements for Documents Concerning Registration.

Enforcement of DPOAs has rarely been tested in Brazil, and there is no specific rule for supporting documents.

See 2.8.1 Deregistering Aircraft in This Jurisdiction regarding IDERAs. It is advisable to stipulate that a DPOA be governed by Brazilian law.

The Brazilian Civil Code allows irrevocability clauses in powers of attorney, but there is some controversy regarding their effectiveness.

The process of physically exporting an aircraft, controlled by the SRF, is entirely distinct from the deregistration process. No SRF regulations have ever been issued in respect of the export of aircraft by parties other than Brazilian operators.

In principle, any party (mortgagee, owner or lessor) in possession of an aircraft by a court order or amicable redelivery may fly the aircraft out of Brazil – in the case of a court order, provided the international movement of the aircraft is not restricted. Whether the consent of another party is needed depends on the terms of the court order or, in the case of amicable redelivery, the terms of the relevant documents.

The best measures a mortgagee, owner or lessor can take when negotiating a lease or mortgage are to require and register an IDERA with the RAB and clearly stipulate in the lease or security agreements rights to repossess and remove the aircraft from Brazil.

See also 2.8.12 Aircraft Export Permits/Licences.

Temporary Admission

An aircraft operating under an operating lease (which is most aircraft in Brazil) is imported under a set of customs rules called “temporary admission”. Aircraft operating on finance leases and aircraft purchased by Brazilian parties are imported under definitive import rules. Regardless of whether an aircraft is operating under the temporary admission or definitive import rules, the only party that may deal with the SRF in relation to export matters is almost always the importer (ie, the Brazilian operator).

When an aircraft is exported, the import process should be closed through an export registration called a unified export declaration (DU-E). However, there are doubts about the ability of parties other than the original importer to obtain DU-Es.

Exporting Repossessed Aircraft

This has not prevented lessors and owners from exporting repossessed aircraft. In most cases, aircraft can be flown to locations outside Brazil without the prior issuance of a DU-E, which can be obtained after an aircraft has left Brazil. In 2019, this procedure was used with approximately 35 aircraft redelivered by a bankrupt airline. However, due to inconsistencies between the SRF offices in different locations in Brazil, some problems have arisen with repossessed aircraft that lessors intend to move out of Brazil prior to the issuance of a DU-E.

Most cases were resolved without litigation, but there is a chance a lessor might need to seek a court order for removal. According to the Cape Town Convention, the SRF should assist authorised parties named in registered IDERAs to export aircraft. This has not yet occurred. Consequently, export procedures should be carefully reviewed on a case-by-case basis.

A DU-E cannot be issued in advance; once issued, it is valid for a limited number of days.

There are nominal fees for DU-Es.

As mentioned in 2.6.1 Restrictions on Lessors’ Abilities, a lessor should confirm if it will need a certificate of airworthiness for export, since these can only be obtained prior to deregistration. Therefore, when dealing with repossessed aircraft, it is preferable for the next registry to be one that does not require a certificate of airworthiness for export.

Insolvency proceedings are regulated in the Brazilian Bankruptcy Law (2005; amended 2020), including restructurings, reorganisations, insolvencies and liquidations.

Article 199 of the Bankruptcy Law relates specifically to commercial aircraft leases, and stipulates that rights under aircraft (and engine) leases are not subject to suspension or stay due to a judicial recuperation proceeding. In addition, claims arising under such leases are excluded from judicial recuperation proceedings. Thus, a lessee under judicial recuperation may not prevent or delay lessors from repossessing leased aircraft unless the lessee is up to date with its obligations under the relevant lease.

Furthermore, the Cape Town Convention became effective in 2013 when Brazil adopted Alternative A. A close analysis of Cape Town Convention Aircraft Protocol Article XI(2) demonstrates that there is no applicable stay period against lessor repossession. This zero-day stay applies to leases only. Aircraft financed through other means, such as mortgages, are subject to the 30-day waiting period contained in Brazil’s Cape Town Convention Declarations.

There are two main types of insolvency proceedings provided by the Brazilian Bankruptcy Law:

  • reorganisation under the auspices of a bankruptcy court, called judicial recuperation (Brazil’s rough equivalent to the US Chapter 11); and
  • liquidation (similar to Chapter 7).

See 2.9.1 Overview of Relevant Laws and Statutory Regimes Governing Restructurings, Reorganisations, Insolvencies and Liquidations regarding the laws and articles relevant to a lessee domiciled in Brazil.

If a Brazilian airline seeks judicial recuperation protection, leases will not be set aside.

In a 2019 case (Oceanair, dba “Avianca Brasil”), however, lessors were erroneously stayed from repossessing aircraft for approximately 120 days, during which Oceanair paid one month′s rent. The last court decision on the merits in the Oceanair matter upheld the lessor's right to repossess aircraft, so there should be no erroneous decisions in future judicial recuperation cases.

Leased aircraft are not deemed part of a lessee’s property during a bankruptcy proceeding. If an airline is placed into liquidation, the aircraft or engines would be returned to the lessors/owners, as applicable. In liquidation, claims of lessors would usually be grouped with unsecured claims.

The liquidation of Brazilian airlines is a lengthy process that tends to persist for years. There are seven airlines currently in liquidation:

  • Transbrasil;
  • Varig;
  • VASP;
  • VarigLog;
  • BRA;
  • Pantanal; and
  • Oceanair.

Another Brazilian airline, Gol Linhas Aéreas, filed for protection with New York courts under the US Chapter 11 proceeding. There are no parallel proceedings in Brazil. The Gol insolvency proceeding is taking place entirely outside Brazil, with no participation or protection from the Brazilian judiciary.

The Gol Chapter 11 proceeding is the first time a Brazilian airline has sought to reorganise outside Brazil. The airline known as “Latam” also reorganised itself in New York using the Chapter 11 procedure, but the primary entity in that proceeding was a Chilean debtor that happened to own a Brazilian airline. Therefore, the Gol case is one of first impression. It is still ongoing at the time of publication.

Late in December 2020, the Brazilian Bankruptcy Law was amended to simplify and standardise cross-border insolvency proceedings. Brazil adopted the Model Law on Cross-Border Insolvency promulgated by the United Nations Commission on International Trade Law (the “Model Law”) (also corresponding to Chapter 15 of the United States Bankruptcy Code). This is intended to foment co-operation among Brazilian and foreign judges and to increase the legal security of cross-border business activities and investments.

The same definitions provided in Article 2 of the Model Law have been incorporated into the Brazilian Bankruptcy Law, which contemplates the following:

  • a foreign proceeding;
  • a foreign main proceeding;
  • a foreign non-main proceeding;
  • a foreign representative;
  • a foreign court; and
  • an establishment.

The scope of application of the Model Law is now mirrored in the Brazilian Bankruptcy Law, and a foreign representative may seek recognition of a foreign proceeding in a Brazilian court. Upon receipt of a legal representative filing, Brazilian courts should recognise the foreign proceeding as either the main or a non-main proceeding, depending on the country where the debtor’s centre of main interests (COMI) is located.

The new law confirmed the provision of the Brazilian Federal Constitution, which established that foreign judgments are valid in Brazil only after ratification by the Superior Court of Justice in Brazil; see 2.6.6 Domestic Courts’ Recognition of Foreign Judgments/Awards.

Both a DPOA and an IDERA should survive a bankruptcy restructuring. Conversely, in cases of liquidation, powers of attorney are usually deemed revoked but, according to the Cape Town Convention, IDERAs should remain valid. Since the Brazilian airlines that have been placed in liquidation no longer had possession of any aircraft, the validity of an IDERA after a declaration of liquidation remains untested.

See 2.9.2 Overview of Relevant Types of Voluntary and Involuntary Restructurings, Reorganisations, Insolvencies and Receivership.

Brazilian parties are rarely borrowers in aircraft transactions. In the few cases where the borrower is Brazilian, insolvency would result in the claims of the lender being grouped with other similar claims, secured or unsecured, depending on the loan terms. If a guarantor were to become insolvent, the lender would lose the benefit of the guarantee.

The Brazilian Bankruptcy Law contains a 180-day moratorium to protect debtors generally. However, as noted in 2.9.1 Overview of Relevant Laws and Statutory Regimes Governing Restructurings, Reorganisations, Insolvencies and Liquidations, Brazilian aircraft and engine leases are subject to a special article thereunder that prohibits any stay or moratorium.

See 2.9.2 Overview of Relevant Types of Voluntary and Involuntary Restructurings, Reorganisations, Insolvencies and Receivership.

There are no reported cases of ipso facto defaults forming the basis of a lessor request for repossession. Many practitioners doubt that ipso facto defaults alone are sufficient to obtain lessor relief. Payment performance defaults have been the most common causes of action.

To date, Brazilian airlines under liquidation were not operating when the liquidation orders were issued, so no impact on aircraft, rentals, security deposits and maintenance reserves has arisen. If a court determines that a lessee should be wound-up and liquidated, a liquidator is appointed. The liquidator has the discretion to terminate or preserve bilateral contracts (aircraft leases). If the liquidator elects to preserve them, the airline, acting through the liquidator, would be obliged to comply with all the terms thereunder, including payment obligations. In the context of airlines, the chances that a liquidator would maintain a lease for extended periods are remote, except possibly to continue operations for tickets already sold.

Since leased aircraft do not belong to a lessee, its creditors cannot encumber the aircraft to secure amounts due. The lessor would be entitled to repossess the aircraft. Thus, if the lessee does not redeliver the aircraft, the lessor may begin repossession action.

The Bankruptcy Law does not expressly deal with cash security deposits or maintenance reserves. In past airline insolvency cases, lessors were able to retain security deposits and maintenance reserves.

The Bankruptcy Law includes a claw-back provision that arises in cases of liquidation. Several types of transactions are subject to annulment after a company is placed into liquidation (eg, prepayment of obligations not yet due or gratuitous transfer of assets).

The Cape Town Convention and accompanying Aircraft Protocol have been in effect since May 2013. The RAB was appointed by Brazil as the State’s Authorised Entry Point (AEP), and AEP Codes are required to register international interests over airframes (the Convention does not require them to register international interests over engines).

To obtain an AEP Code, the applicant must be previously registered and have a valid power of attorney from at least one party in interest. Brazilian AEP Codes cannot be disclosed by the professional user entity (PUE) or transacting user entity (TUE) that obtains them. Consequently, international interests over aircraft registered with the RAB are almost always made by PUEs based in Brazil. The RAB needs, on average, between one and four business days to issue an AEP Code, depending on the backlog of requests.

The following declarations have been made by Brazil under the Cape Town Convention:

  • Article 39(1)(a) – priority of non-consensual rights and interests under local laws preserved;
  • Article 39(1)(b) – detention rights preserved;
  • Article 39(4) – priority of non-consensual rights in Article 39(1)(a) as of the accession date;
  • Article 53 – jurisdiction of Brazilian courts; and
  • Article 54(2) – self-help remedies (other than IDERAs) are not allowed.

The following declarations have been made by Brazil under the Aircraft Protocol:

  • Article XXX(1) – Brazil will apply the “choice of law‟ provision in Article VIII;
  • Article XXX(2) – Brazil will fully apply Article X (interim relief) provisions, with the following timeframes declared:
    1. ten calendar days (remedies in Article 13(1)(a), (b) and (c)); and
    2. 30 calendar days (remedies in Article 13(1)(d) and (e);
  • Article XXX(3) – Brazil adopted Alternative A of Article XI (remedies on insolvency) with a waiting period of 30 calendar days;
  • Article XXX(1) – Brazil will apply Article XII (insolvency assistance);
  • Article XXX(1) – Brazil will apply Article XIII (IDERA); and
  • Article XIX(1) – the RAB is the authorised entry point in Brazil.

According to Brazil’s Declarations under the Cape Town Convention, the RAB will recognise and honour a request for deregistration based on an IDERA without the need for a court order (see 2.6.1 Restrictions on Lessors’ Abilities).

See 2.3.8 Requirements for Documents Concerning Registration and 2.8.1 Deregistering Aircraft in This Jurisdiction regarding IDERAs’ requirements, and 2.8.4 Duration of Deregistration Process for the timing of the process. The authorised party in an IDERA should ensure it is registered with the RAB at the onset of the lease term or financing term.

The RAB does not countersign or stamp its acknowledgement of submitted IDERAs but will, on request, issue a certificate confirming registration. Thereafter, the original IDERA need not be retained.

After the Cape Town Convention came into effect, there were a few repossession cases where the plaintiffs pleaded application of the Convention and the courts issued repossession orders within Convention periods. In those early cases, however, the courts rarely cited the Convention as a basis for repossession orders.

In November 2018, civil courts in Brazil issued repossession orders against Oceanair within two days after requests were filed. Thus, these pre-insolvency cases complied with the Convention’s “speedy relief” provisions despite the lack of reference to the Convention in the repossession orders. The Oceanair case was the first test in Brazil of the insolvency provisions of the Cape Town Convention; see 2.9.2 Overview of Relevant Types of Voluntary and Involuntary Restructurings, Reorganisations, Insolvencies and Receivership.

In February 2020, a civil court from the State of Paraná expressly cited the Cape Town Convention as the legal basis for a preliminary injunction ordering the repossession of two aircraft in favour of a lessor.

Brazil is a party to the 1948 Geneva Convention and the 1933 Rome Convention on the Unification of Certain Rules relating to the Precautionary Arrest of Aircraft; however, implementation of the Cape Town Convention expressly states its prevalence over both previous conventions to the extent there is any overlap.

There are no particular restrictions on foreign lenders financing an aircraft. However, financing aircraft and engines through loans is rare in Brazil for various reasons, including repossession precedent and tax efficiency.

The exchange controls and registration requirements applicable to finance leases also apply to loans; see 2.1.4 Exchange Controls.

Borrowers are permitted to grant security to foreign lenders.

Downstream, upstream and cross-stream guarantees are permitted in favour of lenders. Guarantees should be carefully drafted to ensure certain statutory benefits provided to guarantors are waived; see 2.3.8 Requirements for Documents Concerning Registration. Guarantees tend to be registered in an RTDs rather than the RAB.

Special purpose vehicles are rare in Brazil. Pledges over share agreements are recognised in Brazil; see 2.3.8 Requirements for Documents Concerning Registration. In addition, the pledge should be listed in the company’s share register. If shares are publicly traded, the pledge may be subject to additional registration and disclosure requirements.

Negative pledges are valid in Brazil.

If an intercreditor arrangement includes any Brazilian party (a rarity), the requirements listed in 2.3.8 Requirements for Documents Concerning Registration apply. Intercreditor agreements would usually be registered with an RTD.

Facility agents and security trustees are readily accepted as parties in interest in loan and lease transactions. The RAB frequently registers interests in aircraft in the name of such agents or trustees (rarely Brazilian).

Subordination is achieved through written agreements and consents. Most debt subordination relating to aircraft and engine financing is achieved outside Brazil. Lease Subordination Agreements should be registered with the RAB (see 2.3.8 Requirements for Documents Concerning Registration).

Assuming the debtor is Brazilian, the transfer or assignment of all or part of an outstanding debt under an English or New York law-governed loan is permissible and recognised in Brazil. If an ROF is required (see 2.1.4 Exchange Controls), it should be amended if the payee changes.

Usury rates are applicable in Brazil at twice the Central Bank of Brazil’s interbank rate. That rate is called the SELIC rate and at the time of writing is in the region of 10.5% per annum. Whether that rate would apply to a cross-border lease is uncertain. Charging a premium for holdover rent is not prohibited, but it is uncommon. Whether or not local usury restrictions apply to cross-border leases is also uncertain.

A combination of security deposits, maintenance reserves, security assignments of rights under leases, guarantees, letters of credit, promissory notes, mortgages and account pledges are typical in aviation finance transactions involving Brazilian-registered aircraft.

There are no specific restrictions on the forms of security that could be taken by a creditor over a Brazilian-registered aircraft.

See 2.2.5 Recognition of the Concepts of Trust/Trustee.

Pursuant to a mortgage, a borrower may assign its rights to an aircraft or under an aircraft lease (including insurance) to a security trustee; see 2.7 Lease Assignment/Novation.

Brazil allows for the assignment of rights and benefits without a lessor’s attendant obligations. For example, a foreign lessor of a Brazilian-registered aircraft on lease to a Brazilian lessee is allowed to assign its rights and benefits under the lease, including its rights and benefits under relevant insurance, by way of security, to a foreign security trustee located in the US (who may hold such security on trust for a changing pool of beneficiaries), without assigning the attendant obligations of the lessor under an aircraft lease.

See 2.2.1 Mandatory Terms for Leases Governed by English or New York Law,2.6.6 Domestic Courts’ Recognition of Foreign Judgments/Awards and 3.1.10 Transfer/Assignment of Debts Under Foreign Laws.

The Brazilian Aeronautical Code establishes that, when registered with the RAB, a mortgage creates a lien over a Brazilian-registered aircraft. Brazil is a contracting state under the Cape Town Convention, and qualifying mortgages should be registered in the International Registry. The Aeronautical Code further provides that rights in rem over Brazilian aircraft are to be governed by Brazilian laws.

Since the Cape Town Convention came into force in Brazil, it is arguable that parties are free to choose the governing law of a mortgage; however, the validity of foreign law mortgages in Brazil has not yet been tested. Nonetheless, lenders are increasingly relying solely on Cape Town Security Agreements as security, especially in ABS and warehouse transactions. If agreements do not take the form of Brazilian law mortgages, they are not registered at the RAB and do not establish liens under the Brazilian Aeronautical Code.

Aircraft lease security assignments usually have no Brazilian parties and are rarely governed by Brazilian laws; therefore, the question of the creation and validity of the contractual provisions must be addressed by counsel in the relevant jurisdiction.

To be enforceable in Brazil, a security assignment should be registered with the RAB or an RTD, with a notice of assignment to, and acknowledgement from, the Brazilian lessee; see 2.3.8 Requirements for Documents Concerning Registration.

A security assignment of rights under a lease and an acknowledgement of the security assignment from the Brazilian operator (describing, inter alia, the assignee’s right to exercise the lessor’s remedies thereunder, such as repossession) should be obtained and registered with the RAB.

Parties should also consider the need to take out a Brazilian law mortgage (see 3.2.6 Choice of Foreign Law).

Domestic law security instruments and/or local law filings are not mandatory to enable Cape Town filings, which follow the requirements provided for in the Convention and Protocol to determine whether a security instrument creates a registerable international interest.

The average costs of executing a domestic law security instrument and completing local law filings vary, and include:

  • notarisation costs, which are nominal and rise according to the number of signatures (not applicable for digitally signed documents);
  • costs related to apostille/consular legalisation if any party signed the instrument abroad;
  • costs related to sworn translations into Portuguese (see 2.3.8 Requirements for Documents Concerning Registration); and
  • RAB and RTD fees (see 2.3.1 Notation of Owner’s/Lessor’s Interests on Aircraft Register and 2.3.6 Taxes/Duties Payable for Registering a Lease).

A security assignment governed by English or New York law may be registered with the RAB; see 3.2.6 Choice of Foreign Law and 3.2.7 Formalities/Mandatory Terms to Create and Perfect Security Assignments.

The transfer of contractual rights is recognised if the provisions detailed in 2.3.8 Requirements for Documents Concerning Registration are met. As mentioned in 3.2.6 Choice of Foreign Law, Brazilian law mortgages are required to establish a lien under Brazilian laws. A transfer of security interest of a Brazilian law mortgage would require a written instrument filed with the RAB.

If the identity of a security trustee under a security assignment changes, the new security trustee and the lessor should serve a new notice to the Brazilian lessee, and obtain an acknowledgement from them. To be enforceable, each of these documents must be registered at the RAB; see 2.3.8 Requirements for Documents Concerning Registration.

As noted in 2.2.5 Recognition of the Concepts of Trust/Trustee, trusts are not recognised in Brazil per se. A parallel debt structure established in a common law jurisdiction would be effective in Brazil since the trustee/agent would hold the security under the secured debt. Parties would not be able to create a trust under Brazilian law.

A security trustee will not be deemed resident or domiciled in Brazil as a result of being a party to or enforcement of a security assignment over Brazilian-registered aircraft; see 2.1.4 Exchange Controls and 2.4.2 Effects of Leasing on the Residence of a Foreign Lessor.

A domestic law mortgage is perfected through its registration with the RAB; see 2.3.8 Requirements for Documents Concerning Registration.

Aircraft mortgages registered with the RAB establish and perfect security interests over the aircraft (including its engines). The effect of registering a spare engine mortgage is less certain since engines themselves are not registered objects (see 2.3.3 Aircraft/Engine-Specific Registers).

International interests arising from security agreements over aircraft engines should be registered with the International Registry, according to the Cape Town Convention (see 2.10 Cape Town Convention and Others).

Receivables can be deposited in escrow accounts in Brazil. Parties can enter into receivables pledge agreements where a party would pledge its rights over receivables in favour of a creditor. In addition, parties can execute account management agreements, pursuant to which a bank receives instructions on how to release the account funds.

Since revenue coming into a Brazilian bank account will be in Brazilian currency, and most leases require payments in US dollars, account management agreements tend to be complex and include provisions for the bank to convert and remit funds to the foreign creditor and to subsequently credit the balance to the Brazilian operator.

A pledge over receivables and related security instruments must be registered with an RTD for security perfection purposes. Escrow arrangements of this nature are uncommon with commercial airlines but relatively common with helicopter operators and air taxi companies.

See also 2.3.1 Notation of Owner’s/Lessor’s Interests on Aircraft Register.

As covered in 2.4.5 Attachment by Creditors and 2.4.6 Priority of Third Parties’ Rights, airport and navigational authorities have not sought to exercise liens over aircraft but have occasionally sought to block the export of both commercial and business aircraft for unpaid airport navigation and parking fees (akin to a detention order). Lessor experience on this issue has been inconsistent. In most commercial aircraft repossession cases, lessors have not had the export of aircraft blocked by third parties.

There have been a few scattered cases where the SRF sought to confiscate private/corporate aircraft due to violations by lessees of customs and import regulations, with the expectation that Brazilian lessees would indemnify the owners.

Although not entirely settled, repairers generally do not have mechanic′s liens over aircraft, but there are a few cases of mechanic's liens being exercised against leased aircraft. As far as is known, a crew has never asserted a claim against an aircraft for unpaid wages.

See also 3.3.4 Statutory Rights of Detention or Non-consensual Preferential Liens.

Liens are considered discharged on the date a release is filed with the RAB.

Similar to leases, there is no separate mortgage or other security register; see 2.3.3 Aircraft/Engine-Specific Registers.

Brazil made a Declaration under Article 39 of the Cape Town Convention, preserving the supremacy of non-consensual claims under national law. No particular categories of non-consensual interests were mentioned in Brazil’s Declarations.

In Brazil, fleet liens have not been asserted in the past.

Certificates from the RAB and the International Registry enable a potential purchaser to verify that an aircraft is free of registered encumbrances.

There are relevant differences in enforcing a security assignment as opposed to a loan or guarantee.

Security assignments are typically accompanied by notices of assignment, and acknowledgements/consents from the lessee, given to a security trustee or the ultimate creditor, agreeing to redirect payments to a security trustee and recognising the exercise of lease remedies by the assignee.

The executed instrument must be registered with the RAB to produce effects. If there is a default under the lease or security assignment, the security trustee (assuming the rights of the lessor under the lease) is able to bring proceedings against the lessee.

Remedies available to enforce a loan or guarantee are different.

Under Brazilian law, lenders or creditors (whether secured or not) cannot generally apply for repossession of an asset pertaining to the borrower. The usual remedy is, therefore, to seek a money judgment; this would involve a court auction regarding the encumbered asset, the proceeds of which would be used to pay the secured party’s claim. For a variety of reasons, this remedy is ineffective with aircraft in Brazil.

Provided the security assignment, notice and acknowledgement of assignment have been registered with the RAB, the security trustee is able to exercise its rights thereunder.

See 2.6.6 Domestic Courts’ Recognition of Foreign Judgments/Awards.

See 2.6.6 Domestic Courts’ Recognition of Foreign Judgments/Awards and 2.6.12 Enforcement of Foreign Arbitral Decisions.

See 2.6.1 Restrictions on Lessors’ Abilities and 3.4.1 Differences Between Enforcing Security Assignments, Loans and Guarantees.

See 2.6.3 Specific Courts for Aviation Disputes.

See 2.6.4 Summary Judgment or Other Relief and 2.6.12 Enforcement of Foreign Arbitral Decisions.

See 2.6.7 Judgments in Foreign Currencies.

See 2.6.9 Lessor’s Requirement to Pay Taxes/Fees.

There are no other significant issues regarding the enforcement of lender rights.

There are no relevant material issues or court judgments.

There is a bill pending in the Brazilian Congress that, if ratified, would impose a new tax on aircraft due to their harmful impact on the environment. The tax would commence in 2027 and the rate is not yet known. As this is a draft bill pending in the Congress, its terms could change or the entire project could be cancelled before becoming law.

Also see 2.6.5Domestic Courts' Approach to Foreign Courts and Judgments regarding the recent amendments to the Brazilian Code of Civil Procedure, which might limit parties’ ability to freely choose courts to govern disputes.

Basch & Rameh

Rua da Consolação 3741 13º and CEP
01416-001
São Paulo, SP
Brazil

+55 11 3065 4455

+55 11 3064 6049

basram@baschrameh.com.br www.baschrameh.com.br
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Law and Practice in Brazil

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Basch & Rameh was founded in 2000 and specialises in international transactions, mainly project, corporate and asset-based finance (aircraft, vessels and oil rigs). It also focuses on corporate law matters, technology, foreign investment in Brazil, litigation and arbitration, representation of Brazilian companies with foreign investments, joint ventures, banking, insurance, shipping, aeronautical and maritime law. Clients are foreign companies with interests in Brazil, and Brazilian companies with interests abroad. The firm is headquartered in São Paulo and opened a branch office in Rio de Janeiro in 2011. The team comprises 11 attorneys who all have extensive experience of both domestic and international matters across a broad range of legal subjects.