Brasil

Brazil's adhesion to the Vienna Convention on International Sale of Goods

On 5 December of the present year, the Brazilian Congress approved a bill of decree ("Projeto de Decreto Legislativo 73/2012") establishing the adhesion of Brazil to the United Nations Convention for Contracts on International Sale of Goods - CISG. The bill shall be sanctioned by the President of the Republic shortly and thus, the CISG shall be officially part of the Brazilian legal system. About CISG Signed in Vienna in 1980, the CISG is an international treaty developed by the United Nations Commission on International Trade Law - UNCITRAL, aiming to promote international trade by removing legal barriers in international trade and to unify international sales law. It came into force as a multilateral treaty on 1 January 1988, after being ratified by 11 countries. At present, this treaty has been ratified by a total of 78 countries that account for a significant proportion of world trade. The CISG is divided into four main parts. Part I defines the Conventions' sphere of application and contains general provisions as to interpretations, usages and requirements of contractual form (Articles 1-13). Part II deals with the formation of the contract (Articles 14-24). Part III contains the main body of rules on sale of goods (Articles 25-88), and Part IV provides the public international framework (Articles 89-101). Application of CSIG in Brazil prior to formal adhesion It is important to note that, even though Brazil has not yet formally ratified the CISG, in practice this treaty has already been applied to international contracts with Brazilian parties and has been also used as a source of inspiration by the Brazilian courts. In accordance with Article 1, the CISG applies to contracts of sale of goods between parties whose places of business are in different States: (a) when the States are Contracting States; or (b) when the rules of private international law lead to the application of the law of a Contracting State. Thus, CISG was already applicable to Brazilian parties when: a) the applicable law is the law of a Contracting State in connection with Article 9 of the Introductory Act to the Brazilian Civil Code; and b) the parties choose the Convention as the applicable law in arbitral procedures. Furthermore, Brazilian courts have already referred to the CISG in their decisions as an auxiliary means of interpretation. For instance, in May 2008, in case no. 379.981-4/0, the 4th

Civil Division of the Appeal Court of São Paulo cited Article 72 of the Vienna Convention in reference to an anticipated breach of contract. Also, in July 2007, in case no. 1.170.013-1, the 16th Civil Division of the Appeal Court of São Paulo referred to seller's duty to mitigate loss in order not to cause further losses to the debtor in light of article 77 of the CISG. Advantages and criticisms of the adhesion As a matter of fact, over its twenty years of application, the CISG has not been exempt from criticism. Amongst others, critics have argued that the CISG is incomplete; there is no mechanism for updating the provisions, and no international panel to resolve interpretation issues Nevertheless, in a world where relations among nations become increasingly more intense, it is of utmost importance to have an unified code of rules and regulations, making importing and exporting and other facets of international trade easier. Instead of dealing with the domestic laws for international trade in several foreign countries, companies can readily apply CISG. In this respect, the CISG promotes freedom of contract over the regulation of private international behavior by replacing potentially national litigious legal regimes with a set of laws that allows for self-regulation. In view of the relevant role of Brazil in world trade, the adhesion of the country to this Treaty shall contribute, without any doubt, to an improved legal certainty and stability in international sales of goods, and a more adequate legal landscape for the regulation of international sales contracts than that provided by internal national law, given the peculiarities of this type of contract.

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