In Brazil, the main laws and regulations of the product safety legal regime are the following:

• Brazilian Consumer Protection Code, enacted in 1990, establishing rules to meet consumer requirements, namely: to respect the dignity, health and safety of consumers; to safeguard their economic interests; to improve the quality of their lives; and to transfer and harmonise consumer relations. The Brazilian Consumer Protection Code governs all legal aspects of consumer relations, including safety requirements with which products must comply;
• Decree no. 2181/1997, establishing arrangements for the organisation of the National System of Consumer Protection (SNDC) and establishing general rules for application of administrative sanctions related to the Brazilian Consumer Protection Code;
• Ministry of Justice Ordinance No. 618/2019, which regulates the procedure for recall of all kinds of products; and
• Law 8,137/1990, which establishes crimes against consumer relations and respective sanctions.

The Brazilian Consumer Protection Code and Ordinance No. 618/2019 apply to all consumer relations. Apart from these, there are some specific safety regulations according to the kind of product. Some examples are:

• Board Resolution No. 625/2022 of the Brazilian Health Surveillance Agency (ANVISA), applicable to medicines;
• Board Resolution No. 551/2021, also of ANVISA, applicable to medical products/devices (other than medicines);
• Board Resolution No. 655/2022, also of ANVISA, which regulates the collection of food and packaging or any other materials in contact with food, among others;
• Board Resolution No. 727/2022, also of ANVISA, which regulates the labelling of packaged foods; and
• General Telecommunications Law (Law No. 9,472/1997), which prohibits the use of radiofrequency emitting equipment without the certification of the Brazilian Telecommunications Agency (ANATEL).

The main regulator for product safety in Brazil is the National Secretary for Consumer Protection (SENACON), responsible for (i) examining claims involving relevant general and national interests, (ii) applying administrative penalties, and (iii) undertaking preliminary investigations and administrative proceedings, among other measures.

The Federal Government, States and/or Federal District and cities may also have a Consumer Protection Office (PROCON), which has the power to carry out administrative proceedings and apply administrative penalties to suppliers within the scope of its jurisdiction.

In addition, there are various rule-making and regulatory authorities with the power to establish standards to be complied with by suppliers. Each sector has its own regulatory authorities, and we list some examples below:

• Brazilian Health Surveillance Agency (ANVISA), responsible for promoting the population’s health by means of sanitary control of several products, such as medicines, food and cosmetics. It has the power to (i) establish rules and standards limiting the use of contaminants, toxicants, disinfectants, heavy metals and other substances that may cause damage to health, and also (ii) prohibit the manufacture, distribution and storage of products that may cause damage to health;
• Brazilian Telecommunications Agency (ANATEL), responsible for supervising the provision of telecommunications services, applying penalties and issuing rules to be complied with by the suppliers;
• Brazilian Civil Aviation Agency (ANAC), responsible for supervising civil aviation activities in Brazil, specifically the economic aspects and technical safety of the sector;
• Brazilian Agency of Oil, Natural Gas and Biofuels (ANP), responsible for supervising activities that involve oil, natural gas and biofuels;
• Brazilian Electric Power Agency (ANEEL), which aims to regulate the production, transmission and marketing of electric power, in accordance with the policies and guidelines of the federal government;
• Brazilian Agency of Supplementary Health (ANS), which regulates the market for private health plans;
• National Data Protection Authority (ANPD), responsible for ensuring the protection of personal data, pursuant to the law, and for issuing regulations and procedures on personal data protection and privacy, and other roles provided in the law;
• National Institute of Metrology, Quality and Technology (INMETRO), responsible for implementing national metrology and quality policies and for assessing and supervising compliance with technical and legal standards as regards measurement units, measurement methods, materialised measures, measuring instruments and pre-measured products; and
• Brazilian Association of Technical Standards (ABNT), responsible for drafting technical standards for the production, marketing and use of goods and services in a competitive and sustainable way in domestic and foreign markets, contributing to scientific and technological development, environmental protection and consumer protection.

Note that compliance with the normative standards established by these bodies is mandatory by law, pursuant to article 39, VIII of the Brazilian Consumer Protection Code.

According to the Brazilian Consumer Protection Code, products and services placed on the consumer market may not pose a health or safety hazard to consumers.

If a supplier acknowledges the harmful and/or hazardous nature of a product or service only after it has been placed on the consumer market, it will be responsible for a recall campaign immediately after the defect is discovered in order to correct the defect or replace the product.

The Brazilian Consumer Protection Code and Ministry of Justice Ordinance No. 618/2019 establish several formal requirements that suppliers must observe during a recall procedure. The main formal requirements are immediate notice to (i) the Consumer Protection and Defence Department (DPDC) and (ii) the pertinent rule-making or regulatory body. Besides this, the suppliers are responsible for the publicity campaign and the follow-up reports.

With regard to the publicity campaign, the law establishes that, besides informing the relevant authorities, suppliers should immediately make consumers aware about the hazardous nature of the product by means of a publicity campaign broadcast on the radio, television, print media or internet (YouTube, podcasts or elsewhere) including the suppliers’ websites, at the suppliers’ expense.

The warnings must contain very specific information about the product, the defect and its possible effects, among other requirements. The publicity campaign’s size should be based on the number of consumers affected by the recall, and the suppliers may choose the means of communication in accordance with the consumers’ profile, justifying to the DPDC how they aim to reach consumers and run an effective recall campaign.

In turn, follow-up reports must be sent once every four months to the DPDC. The reports must specify the number of products collected from the market so the authority may analyse the effectiveness of the procedure.

Current regulation does not specify a risk level for applicable corrective actions to be taken. Even if there is a remote risk to consumer health, the suppliers will be responsible for commencing corrective actions and running mandatory warning campaigns.

The above-mentioned regulation is applicable to all products, but ANVISA also has specific rules on recall of medicines and food (Board Resolutions No. 625/2022 and No. 655/2022). In this regard, it is also mandatory to notify ANVISA if the supplier acknowledges the harmful and/or hazardous nature of medicines or food.

In Brazil, the obligation to notify the authorities in respect of product safety issues is based solely on the existence of a risk. Thus, should a defective product pose a health or safety hazard to consumers, the reporting obligation will be triggered, regardless of the level of the risks.

Under Brazilian law, “supplier” means any individual or legal entity (including unincorporated entities), public or private, Brazilian or foreign, engaged in the production, assembly, creation, construction, transformation, import, export, distribution or marketing of goods, or in the provision of services. Any such individual or entity that participated in the placement of a product or service on the market must perform the recall upon becoming aware of the danger of that product or service.

It is worth noting that should a supplier suspect the existence of products or services placed by it on the consumer market that may be harmful or hazardous to consumers’ health or safety, the supplier must inform the DPDC within 24 hours, and start an internal investigation in order to verify whether the suspected defect has grounds or not. Such investigation must be completed within ten days, but the supplier can request an additional term if it proves to be necessary. The outcome of the investigation must be informed to the authority (ie, the reasons why the recall is not necessary or that the recall will be performed).

If the supplier decides to not perform a recall, it is important for it to present documents and technical support to justify that there is no risk to consumers’ health and safety.

It is important to note that, regardless of the timeframe to investigate, if the supplier already has knowledge that the product is defective or concludes that there is defect before finishing the investigation, the supplier must immediately inform the consumer protection authorities and the consumers. In other words, the warning to consumers and to the public authorities must be provided promptly and immediately after the supplier becomes aware of the defect. Of course, it is always tricky to establish exactly when the supplier became aware of the defect, but when informing the relevant authorities about the recall campaign, the supplier must inform them when it became aware of the defect and can argue that it had to conduct a proper investigation by performing technical analysis and seeking expert opinions when it first was informed about the possibility of a defect.

If the supplier decides to perform the recall, the notification to the DPDC must be written in Portuguese and include detailed information, such as:

• the company’s name;
• the defective product;
• the defect identified;
• the risks and implications for consumers;
• the number of defective products on the Brazilian market;
• the number of consumers affected;
• the geographic distribution of the defective products in Brazil and the countries to which the products were exported;
• the measures already adopted and those proposed for correcting the defect and mitigating the risk;
• a description of any accidents related to the defective product prior to the recall;
• a media plan;
• a consumer support plan; and
• the form of risk warning notice to consumers.

The notification to the authorities must be signed by the company’s legal representative, whose powers must arise from the company bylaws or from a power of attorney attached to the records of the administrative procedure.

Brazilian law does not establish that the local entity must be involved in the recall procedure. Thus, a foreign entity may issue the notification to the authorities and to consumers. Nevertheless, it is possible – and quite common – that authorities issue notifications requesting information about the recall specifically from the local entity, if there is one.

It is worth mentioning that there is a recommendation from the Group of Permanent Studies of Accidents of Consumption (GEPAC) (not mandatory but rather just informative) asking that the subsidiaries or importers of suppliers of products and services subject to recall abroad inform the Brazilian authorities about those recalls, even if such products have not been distributed in the Brazilian market.

Failure to comply with the reporting obligations mentioned above may carry administrative, criminal and civil penalties.

In the administrative sphere, should the authorities hold that the supplier violated the provisions of the Brazilian Consumer Protection Code, such as the obligation to commence a recall or the obligation to market safe and adequate products, an administrative proceeding can be initiated. If a violation is confirmed following such administrative proceeding, the supplier is subject to penalties that can be imposed separately or together. The penalties that may be imposed are the following:

• fines;
• seizure of the defective products;
• destruction of the defective products;
• cancellation of product registration at the competent authorities;
• prohibition from product manufacturing;
• suspension of product or service supply;
• temporary suspension of the activity;
• revocation of authorisation or permission for use;
• cancellation of permit for the establishment or activity;
• total or partial shutdown of the establishment, work or activity;
• administrative intervention; and
• counter-advertising.

Suppliers are also subject to criminal investigations in the case of lack of communication, late communication or insufficient communication of a recall campaign. Failure to inform the competent authorities or to withdraw harmful or hazardous products from the market is a crime carrying a prison sentence from six months to two years, and a fine.

Regardless of the administrative and criminal proceedings, consumers, public bodies and associations may also file civil and class actions seeking compensation for property and/or moral damage caused by the defective product.

In addition to such penalties contemplated in the Brazilian Consumer Protection Code, depending on the product, each sector has its own regulators with the power to impose penalties. As an example, in relation to medicines, failure to run recall campaigns in accordance with ANVISA Board Resolution No. 625/2022 can subject the company to the penalties set forth in Law No. 6,437/77: (i) warning; (ii) fine; (iii) seizure of defective products; (iv) destruction of defective products; (v) interdiction of defective products; (vi) suspension of sale and/or manufacture of the defective products; (vii) cancellation of product registration; (viii) partial or total shutdown of the establishment; (ix) prohibition from advertising; (x) cancellation of authorisation for business operation; (xi) cancellation of the establishment permit and intervention in the establishment receiving public funds from any source; (xii) imposition of rectifying message; and/or (xiii) suspension of advertising and publicity.

It is worth noting that the majority of case precedents have established that a supplier that takes all the measures established by the law in order to conduct a recall campaign remains liable for individual lawsuits relating to the defective product even if the consumer did not comply with the recall campaign and did not take the product for repair or replacement (Case no. 1010392 / RJ).

The Brazilian Consumer Protection Code governs all consumer relations in Brazil. According to the law, “consumer relations” refers to the processes for production and placement of goods and services on the market, and their subsequent acquisition and use by the public. Consumer relations occur between purchasers and/or end users, and suppliers.

The law defines a “consumer” as any individual or legal entity that acquires or uses products or services as an end user.

In turn, a “supplier” means any individual or legal entity (including unincorporated entities), public or private, Brazilian or foreign, engaged in the production, assembly, creation, construction, transformation, import, export, distribution or marketing of goods, or in the provision of services.

There are two types of liability under the Brazilian Consumer Protection Code:

• liability as regards a product or service which arises when the product or service causes harm to the consumer (personal injury product liability); and
• liability for a flaw in a product, which arises from a defect that renders the product improper or inadequate for consumption, or reduces its value or quantity, but does not pose any risk to consumer health and safety (property damage product liability).

In relation to product liability claims (ie, personal injury), the law attributes strict liability to Brazilian and foreign manufacturers, producers, builders and importers. In other words, they are liable, regardless of fault, for redress of damage caused to consumers by defects resulting from the design, manufacture, construction, assembly, formulas, handling, presentation or packing of their products, as well as damage caused by insufficient or inadequate information as to the use and risks thereof (article 12 of the Brazilian Consumer Protection Code).

In relation to liability for a flaw in the product, all suppliers of durable or non-durable consumer products are held jointly and severally liable for defects in quality or quantity that render those products unfit or inadequate for the mode of consumption for which they are designed, or that decrease their value, and for defects resulting from any misinformation provided on the container, packaging, labels or advertising message, with due regard for variations ensuing from the nature of the products (article 18 of the Brazilian Consumer Protection Code).

Any consumer suffering property and/or moral damage due to a defective product may bring an individual lawsuit against the supplier.

In addition, court precedents have established that relatives or persons maintaining strong affective ties with the victim may also file a lawsuit and seek compensation if they prove to have been personally affected. In fact, the case precedents from the Superior Court of Justice are in favour of the “préjudice d’affection” doctrine, which allows close family members of a consumption accident victim to pursue indemnification for moral damages against suppliers (Case no. 876448 / RJ).

Moreover, there is also the possibility to file class actions to defend consumer rights. Class actions may be filed by the Public Prosecutor’s Office; the Public Defender’s Office; the federal government, States, Municipalities and the Federal District; the entities and bodies of the direct or indirect public administration, even if they have no separate legal identity, when specifically intended to protect diffuse and collective interests and rights; and associations legally organised for at least one year, and whose institutional purposes include the protection of diffuse, collective and/or homogeneous individual rights.

According to the Brazilian Consumer Protection Code, the right to claim indemnification for damage caused by a defective product or service becomes time-barred within five years from the date the damage and its perpetrator became known (article 27).

It is also worth noting that in Brazil there are circumstances that can suspend or interrupt the statute of limitation. In general, the statute of limitation is suspended when (i) the interested person is absent from Brazil on public duty, (ii) there is a suspensive condition to the obligation, or (iii) the claim arises from a fact that must be entertained by the criminal courts (article 197 et seq of the Civil Code). Also in general, the statute of limitation is interrupted by (i) a judge, even if incompetent, when he or she orders the service of process on the defendant, (ii) a protest claim, (iii) any judicial act that declares a debtor in default, or (iv) any act that unequivocally entails recognition of a right by the debtor (article 202 of the Civil Code).

According to Decree No. 4,657/1942, Brazilian courts will have jurisdiction over product liability claims if the consumer is domiciled in Brazil or the contracted obligation has to be fulfilled in Brazil. Lawsuits are usually filed in Brazil to obtain redress on behalf of Brazilian citizens, but in theory they could also include foreign plaintiffs.

Nevertheless, unlike what happens in other jurisdictions, Brazilian law does not offer particularly favourable options for foreign plaintiffs, so cross-border actions are possible but rare in practice.

Pursuant to article 83 of the Brazilian Civil Procedure Code, foreign plaintiffs may be required to post a bond when bringing suits in Brazil.

According to the Brazilian Federal Constitution, the law shall not exclude any injury or threat to right from the assessment of the Judiciary Branch. Thus, there are no mandatory steps to be taken before the consumer files an indemnification action related to product liability.

However, there is increasing discussion in Brazil over whether consumers should commence conciliatory proceedings at administrative level before bringing lawsuits, as a way to reduce the number of ongoing proceedings and reach solutions for cases with efficiency.

We highlight that Brazil is increasingly setting up online dispute resolution methods. SENACON is responsible for the website www.consumidor.gov.br, which suppliers can choose to join and use to address consumer complaints.

Also, the Brazilian Civil Procedure Code – in force since 2016 – establishes that conciliation, mediation and other consensual dispute resolution mechanisms must be encouraged by judges, lawyers, public defenders and members of the Public Prosecutor’s Office, even during the course of a judicial proceeding.

In product liability claims, the supplier usually bears the burden of proof that the product complies with technical standards and is not defective. The consumer will only have the burden of proving the damage and the chain of causation.

There is no specific rule on preservation of evidence, but non-preservation places a direct burden of counterproof on whoever had a duty to safeguard that evidence. In this regard, if a consumer brings a product liability claim, the consumer has the duty to preserve the allegedly defective product. If the consumer does not take the necessary measures and the defective product is lost, the burden will be upon the consumer to produce counterproof.

Despite the lack of a specific remedy in such situation, any party is entitled to file a motion for anticipated discovery where:

• there are grounded reasons to believe that it will become impossible or very difficult to ascertain certain facts while the lawsuit is pending;
• the proof to be produced is capable of enabling consensual dispute resolution or other suitable dispute resolution methods; or
• previous knowledge of the facts can justify or avoid filing of a lawsuit.

As a general rule, the parties are responsible for providing and producing their own evidence, according to their position on the case. Under the Brazilian Civil Procedure Code, the burden of proof rests (i) with the plaintiff, with respect to facts supporting its alleged right and (ii) with the defendant, with respect to facts impairing, modifying or extinguishing the plaintiff’s alleged right. In relation to product liability claims, the supplier has the burden of proving that the product is not defective while the consumer has the burden of proving the damage and chain of causation.

However, should a request for disclosure of evidence be filed by a party, the judge may command the adverse party to disclose documents or things in its possession. Such request must contain (i) a detailed description, as complete as possible, of the document or thing to be disclosed; (ii) the purpose of the evidence, with a statement of the facts related to the document or thing; and (iii) the circumstances supporting the requesting party’s claim that the document or thing does exist and is in possession of the adverse party.

In that case, the adverse party will have five business days to answer such request. The adverse party may either disclose the document or thing or refuse to do so.

According to law, the judge should not accept such refusal if (i) the adverse party is legally required to disclose the document or thing; (ii) the adverse party has referred to the document or thing in the proceeding with a view to bringing evidence into the records; or (iii) the document, by its content, is common to the parties.

Should the adverse party remain silent during the relevant period or fail to disclose the document after a court decision commanding its disclosure, the judge will hold as true the facts which the adverse party sought to prove by means of the document or thing.

The lack of an acceptable reason to refuse to comply with the disclosure order may give cause to a search and seizure warrant.

The Brazilian Consumer Protection Code, which governs consumer relations, does not have particular rules on expert evidence. Thus, the applicable rules are those established by the Brazilian Civil Procedure Code.

Whenever a case involves technical aspects, the court may be assisted by an expert with forensic knowledge. For example, it is very common to have accounting, engineering and medical evidence in product liability claims.

In such situation, the court appoints its own expert, and the parties are entitled to designate experts to assist in the production of evidence (technical assistant).

The court-appointed expert has the duty to issue an impartial technical opinion on the matter. After that, the parties may present their own expert opinions and commentaries on the opinion of the court-appointed expert.

As a rule, each party is responsible for paying the costs of its experts and the party that requested expert evidence is responsible for paying the fees of the court expert. If the expert evidence was requested by the judge or by both parties, the expenses will be shared between the parties. The judge, however, can determine that the supplier should pay the cost of expert examination when the burden of proof is shifted.

After the final decision, the losing party will refund the other party the corresponding amount.

In product liability cases, consumers usually qualify for legal aid, which means that suppliers will be responsible for paying the costs of expert evidence, or a publicly funded institution will be appointed to perform the expert examination where the supplier did not request the evidence.

Pursuant to the Brazilian Civil Procedure Code, in general it rests with the plaintiff to prove the facts supporting its alleged right. In turn, it rests with the defendant to prove facts impairing, modifying or extinguishing the plaintiff’s alleged right.

In cases involving consumer relations (such as product liability cases), the consumer (usually, the plaintiff) must prove the damage caused by the product and the chain of causation. The supplier, on the other hand, must prove that (i) it did not place the product on the market; or (ii) although it did place the product on the market, the product is not defective; or (iiii) the sole fault for the damage falls on the consumer or a third party.

According to the Brazilian Consumer Protection Code, the judge may shift the burden of proof to the supplier. Shifting of the burden of proof can occur if:

• the claim brought by the consumer is found to be plausible; or
• the supplier is found to hold a dominant position in its relationship with the consumer.

In Brazil, there are summary and ordinary proceedings.

Summary proceedings are aimed at affording a specific treatment to certain cases which, by their own nature, call for simplified and informal procedures, backed by oral arguments and procedural economy. Such cases run before the Small Claims Court, in which cases are resolved in a timely and speedy fashion.

By contrast, ordinary proceedings are generally more complex, in which issues of fact can only be properly analysed through production of evidence, and the amount in controversy is higher.

Regardless of the type of case, a consumer can file a lawsuit before a first-instance court (either summary or ordinary proceeding, specifically before a federal or state court, depending on the defendants involved in the case). Initially, a single judge will review and decide the case.

If an appeal is filed by any of the parties, the case is remitted to the respective second-instance court and a panel of judges will review the case. After that, in some cases, it is possible to file special appeal to the Superior Court of Justice and/or an extraordinary appeal to the Federal Supreme Court. After the second-instance court decision, cases filed before a Small Claims Court are only subject to an appeal to the Federal Supreme Court.

In Brazil, only specific criminal cases are subject to a jury trial.

In addition, the law does not provide for a specific threshold in awards of damages for product liability cases. Thus, the awards are calculated on a case-by-case basis and the courts usually take into consideration the amounts awarded in court precedents issued in similar previous cases.

The Brazilian legal system provides for summary and ordinary proceedings. In ordinary proceedings, the following types of appeals are available in product liability claims:

• Motion for clarification, filed before the court in which the case is ongoing, applicable when the court decision contains any omission, obscurity, contradiction or material error. The timeframe to file a motion for clarification is five business days after the decision is published in the official gazette.
• Interlocutory appeal, filed before the second-instance court against an interlocutory decision in some specific situations, such as a decision relating to shifting of the burden of proof. The timeframe to file an interlocutory appeal is 15 business days after the decision is published in the official gazette.
• Appeal, filed to challenge the lower court final decision within 15 business days after the final decision is published in the official gazette.
• Special appeal, filed to challenge a second-instance decision that is contrary to a treaty or a federal law. The timeframe to file a special appeal is 15 business days after the second-instance decision is published in the official gazette. Should the special appeal be accepted for judgment, the case will be reviewed by the Superior Court of Justice.
• Extraordinary appeal, filed to challenge a second-instance decision that is contrary to a provision of the Federal Constitution. The timeframe to file an extraordinary appeal is 15 business days after the second-instance decision is published in the official gazette. Should the extraordinary appeal be accepted for judgment, the case will be reviewed by the Supreme Court.

With regard to summary proceedings, it is possible to file the following appeals:

• Motion for clarification, to be filed within five business days after the decision is published in the official gazette.
• Appeal, to be filed to challenge the lower court final decision within ten business days after the final decision is published in the official gazette.
• Extraordinary appeal, to be filed within 15 business days after the second-instance decision is published in the official gazette.

The Brazilian Consumer Protection Code provides for two types of liability, namely: personal injury product liability and property damage product liability.

The first type concerns an accident caused by the product resulting in damage to the consumer. In this case, the supplier will only be exempted from liability if it proves: (i) that the product was not placed on the market by the supplier; or (ii) that although the product was placed on the market, it was not defective; or (iii) the sole fault of the consumer or a third party.

By contrast, the liability for a flaw in the product does not arise from any damage caused to the consumer. In this case, liability arises from the flaw itself, which renders the product improper or inadequate for consumption, or reduces its value or quantity, even if there is no possibility that the flaw may harm consumers.

The above-mentioned defences are expressly stated in the Brazilian Consumer Protection Code and shall be applicable to every consumer relation.

Moreover, after the Brazilian Consumer Protection Code was enacted, some scholars have argued that other circumstances, by virtue of the general principle of civil liability, could exclude supplier’s liability. According to such doctrine, despite not being among the defences specifically referred to as established by the Brazilian Consumer Protection Code, in the event of an act of God or of force majeure, the supplier would be exempted from liability in the event of an accident caused by the product. These are well-recognised defences established in the Brazilian Civil Code – applicable to private legal relations – by which to exempt one of the contracting parties from liability due to contractual breach.

At first, this was not a widely accepted theory and only the defences expressly established by the Brazilian Consumer Protection Code were applicable. Nowadays, however, the majority of scholars and the case precedents take the view that the supplier will not be liable in case of a force majeure or an act of God event, due to the absence of a chain of causation between the supplier’s conduct and the damage suffered by the consumer.

In fact, the Superior Court of Justice had already stated that although acts of God and force majeure are not explicitly provided for by the Brazilian Consumer Protection Code, such defences can be invoked as causes that thereby exclude responsibility of the service providers (Case no. 985888/SP).

It is also worth mentioning that the state of the art does not represent a liability exclusion provision expressly contemplated in the Brazilian Consumer Protection Code, and it was withdrawn from the first drafts before sending the bill to the Congressional houses back in the 1990s.

Nevertheless, in some cases we understand that it is possible to construct a no-liability defence substantiated on the limit of knowledge demanded by law. To the extent that the level of understanding that the law demands from the supplier to delimit product safety and the information that will be transmitted to consumers is on the level of what is known or should be known rather than what could be known, it is possible to argue that the law does not expect the supplier to have unlimited knowledge on the product, but rather reasonable knowledge that is precisely established by the rules imposed by regulatory agencies or inspection bodies. This is an argument that has still not matured and hinges on a more extensive debate and acceptance by the academic community, as also referred to in 2.13 The Impact of Regulatory Compliance on Product Liability Claims.

In Brazil, compliance with regulatory requirements is mandatory. A product that does not meet the applicable regulatory requirements cannot be placed on the market. In fact, placing on the market any product or service that does not comply with the rules issued by the competent regulators constitutes an abusive practice under article 39, VIII of the Brazilian Consumer Protection Code. Moreover, article 7, II of Law No. 8,137/1990 establishes that selling or displaying for sale a product whose packaging, type, specification, weight or composition is not consistent with legal requirements or does not correspond to its official classification is a crime against consumer relations.

However, compliance with applicable rules, in and of itself, might not suffice to release the supplier from liability.

Pursuant to the Brazilian Consumer Protection Code, a product cannot be deemed defective when another product of better quality has been placed on the market. The Brazilian Consumer Protection Code does not expressly address this matter, but some legal scholars defend the view that suppliers should not be held liable if a product defect was not discoverable within the limitations of science available at the time of the development and distribution of said product on the market.

Conversely, other legal scholars argue that even if the law does not expressly exclude liability of suppliers due to the development of the product in the state of the art, such liability could not be excluded. The main argument is that the Brazilian Consumer Protection Code adopts objective liability and the supplier holds the risk created by its economic activity, while consumers do not have the means to know the risks that a product poses.

In conclusion, compliance with regulatory requirements must be proven by the supplier in order to avoid the presumption that the product had a manufacturing or design defect. The supplier must also prove that the defect could not be identified when the product was developed, due to the state of the art and the scientific resources available. Those arguments, however, might not be accepted by the courts as sufficient to dismiss a product liability case since courts and most legal scholars hold that suppliers are liable for the risk of developing products.

As a rule, each party is responsible for paying its own expenses during the development of the case. After the final decision, the losing party will be obligated to fully reimburse the other party for all the expenses incurred, such as court fees and legal costs.

In the sphere of consumer relations, plaintiffs (consumers) usually qualify for legal aid. In Brazil, legal aid may be requested on the grounds of a personal statement of inability to pay court fees and legal costs.

Legal aid beneficiaries are not required to immediately reimburse the other party when they lose the case. If the beneficiary is defeated, enforceability of the obligations arising out of his or her defeat will be stayed and such obligations may only be enforced if, within five years, the insufficient income condition no longer exists.

Apart from public funding (legal aid), there is no regulation on other forms of litigation funding in Brazil.

Class actions in Brazil are regulated by Law No. 7,347/1985 and by the Brazilian Consumer Protection Code, being commonly used in Brazil to discuss product liability cases and environmental damage, among others.

With regard to product liability cases, class actions can be filed to protect homogeneous individual rights, consisting of landmark initiatives geared toward representing consumers collectively and expediting resolution of recurrent lawsuits involving common interests of a class.

Under Law No. 7,347/1985 (article 5) and the Brazilian Consumer Protection Code (article 82), the parties with standing to bring a class action to defend the rights of citizens in court are: (1) the Public Prosecutor’s Office; (2) the Public Defender’s Office; (3) the federal government, states, municipalities and the Federal District; (4) the entities and bodies of the direct or indirect public administration, even if with no separate legal identity, when specifically intended to protect diffuse and collective interests and rights; and (5) associations legally organised for at least one year, and whose institutional purposes include the protection of diffuse, collective and/or homogeneous individual rights. Further, the Public Prosecutor’s Office must also intervene in class actions as a law oversight authority (when it is not a plaintiff in the class action). In Brazil, there is generally no requirement for class-representative adequacy as to the parties with standing to file class actions.

In addition to class actions, the Brazilian Civil Procedure Code sets out specific rules on incidental proceedings for resolution of same-subject-matter lawsuits. Such proceedings were introduced in Brazil in 2016 to (1) expedite administration of justice and access to court relief; (2) reduce caseload; and (3) set uniform standards in court decisions. In general, they can be brought in the case of repeated disputes involving the same matters in controversy (matters of law only) and a risk of violation against equal treatment and legal certainty. As a rule, all lawsuits (including class actions) are stayed until this proceeding is adjudicated upon, and all subsequent judgments must follow the decision on the incidental proceeding for resolution of same-subject-matter lawsuits. Nevertheless, the Brazilian court precedent system is not meant to grant court relief directly to plaintiffs, but rather to define legal principles to be followed in all individual and class actions. Consequently, individual lawsuits or class actions will still be necessary to address threats or injuries to rights and interests.

Over the years and since the Brazilian Consumer Protection Code was enacted back in 1990, we have seen many product liability cases (some are still ongoing) such as tobacco litigation and many car product liability issues. Since then, case precedents have also been continually developing in relation to product liability issues.

In a noteworthy product liability decision, the Superior Court of Justice recognised that a supplier could not be held liable for adverse reactions caused to a consumer by a specific medicine if such adverse reaction was specifically and expressly referred to in a warning on the product leaflet (1599405/SP).

In a recent decision about the same subject, the Superior Court of Justice reversed a judgment imposed on a pharmaceutical company in an action for damages for adverse effects, recognising that the adverse effect caused to the consumer was a danger inherent to the product, since there was already information in the product leaflet about the possibility of developing the reaction (REsp 1402929/DF).

In another recent but worrying decision, the Superior Court of Justice stated that a Brazilian company could be held liable for a defective product sold by an affiliate company based abroad and that was purchased by the consumer in a foreign country. Invoking the apparent supplier doctrine, the Superior Court of Justice considered that a company that uses a renowned worldwide brand to market its products should be considered as an apparent supplier, and thus be held liable for the defective product manufactured abroad (REsp 1.580.432/SP). This is not a consolidated and binding decision of the Superior Court of Justice so far and we expect a lot of movement and discussion on this issue in the next years.

Recently, the Ministry of Justice issued Ordinance No. 618/2019, which regulates the procedures that suppliers must follow during a recall campaign. This amendment of the former Ordinance (No. 487/2012) seeks to conform the recall procedure to the current reality of new technologies, making it more agile and consistent with the necessities of the digital age.

Apart from that, data protection and the Internet of Things (IoT) have been receiving growing and significant attention by regulators.

With regard to data protection, for many years, Brazil navigated in a scenario without a personal data protection law and a clear rule on the duties of the supplier after detecting data breaches. On 10 July 2018, that scenario changed with the approval by the National Congress of Bill No. 53/2018, which became Law No. 13,709/2018, called the Brazilian General Data Protection Act. In the same context of data protection and internet regulation, recently, there has also been extensive discussion about a legislative project (PL 2630/2020) to regulate fake news. The project, which is under discussion in the National Congress, aims to establish rules regarding the transparency of social networks and private messaging services, especially with regard to the responsibility of providers (suppliers) to combat misinformation and to increase transparency on the internet regarding sponsored content and the actions of public authorities, as well as to establish sanctions for non-compliance with the law.

There is also a trend of cities and states trying to enact specific State or City Consumer Protection Codes (for example, the State of Pernambuco and the Municipality of São Paulo enacted their own Consumer Protection Codes).

Contrary to the Federal Law (the Consumer Defence Code enacted in 1990), the State and City Consumer Protection Codes are being drafted in order to try to regulate specific sectors, such as supermarkets, transport, cinemas, gas, pharmacies, hotels and lodges, health plans, internet and auto insurance, public services, shows, events, among others.

The State or City Consumer Protection Codes are intended to have application in addition to the Brazilian Consumer Protection Code, which has a national character. It is worth recording, however, a possible debate over the constitutionality of these State and City Consumer Protection Codes. The Federal Supreme Court (STF) has already analysed at least two direct actions for unconstitutionality regarding the possibility of states/cities to enact supplementary rules regarding consumer law.

In the judgment of ADI 5745 / RJ, by majority vote, the STF considered that the legislative activity of the Member States by extending consumer guarantees would be valid.

Specifically in relation to the Consumer Protection Code of the State of Pernambuco, the STF has already concluded other judgments (ADIs 6.207, 6.086, 6.123, 6.214, 6.220 and 6.333), in which the understanding about the constitutionality of the State Consumer Protection Code and the obligations created by Pernambuco’s consumer legislation were confirmed, especially to expand the duty of information to consumers. In other words, the STF confirmed the legislative jurisdiction of the states over the defence of consumer interests, which should encourage the development of new state laws throughout the country.

With regard to City Consumer Protection Codes, the current prevailing understanding is that it is necessary to demonstrate a specific and local interest in order to authorise the creation of a municipal code, which should only contain supplementary provisions (ADI 2188592-33.2019.8.26.0000).

A bill is currently under discussion before the National Congress (PL 2.338/2023) which aims to regulate artificial intelligence systems in Brazil. The proposal intends to create rules for intelligence systems to operate in Brazil, establishing the rights of the people affected by their operation. It foresees the creation of risk classifications for the systems, deals with the rights of the people affected, the duty of transparency and the rules related to copyrights, besides stipulating penalties for any violations of the law and attributing to the Executive Power the prerogative to decide which agency will oversee the supervision and regulation of the sector.

As happened in several other countries, the COVID-19 pandemic severely affected the entire Brazilian legal system, and that included the product safety and liability regime. However, most of the changes have already been repealed as the pandemic situation has improved. We mention the cases below only for example.

One example of the impacts regarding product safety laws relates to recall proceedings. During the pandemic, the National Consumer Office stated that each case should be assessed individually and (i) for defects verified up until 10 March 2020, a two-step recall campaign should preferably be adopted (notice and then corrective/recall measures); and (ii) for defects verified after 10 March 2020, the deadlines for submitting the risk assessment report and recall campaign were suspended.

Moreover, with regard to the cancellation of a product or service, on 24 March 2020, the Executive Office of PROCON-SP issued a technical note by which consumers were recommended to preferably convert contracted services into credit for future use, without incurring any break-up fees, fines or other penalties, instead of simply cancelling the product or service and requesting a refund of any amounts already paid.

Authorities and the government also targeted specific areas of the economy, aiming to reduce the negative effects upon those that were deemed to be more impacted by the social isolation, such as education, tourism and the airline industry, among others.