Brazilian institution CAM-CCBC issues new set of rules to administer corporate law disputes

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The Brazilian arbitral institution CAM-CCBC (Câmara do Comércio Brasil-Canadá) follows the Swiss Arbitration Centre in issuing new rules dedicated to corporate law disputes. The Corporate Arbitration Rules (Regulamento de Arbitragem Societária) provide an efficient additional procedure tailored for companies that decide to arbitrate their corporate law disputes under the rules of the institution.

The Corporate Rules

Following the example of the Swiss Arbitration Centre, which enacted on 1 January 2023 the innovative "Supplemental Swiss Rules for Corporate Law Disputes", the CAM-CCBC issued on 26 April 2023 Supplementary Rules no. 02/2023 (Norma Complementar 02/2023), which supplement the CAM-CCBC Arbitration Rules ("Arbitration Rules") and apply to corporate law disputes whenever the arbitral award is likely to affect third parties to the arbitration.1

The Brazilian institution is now set to efficiently administer future corporate law disputes involving uniform multi-party interests submitted to arbitration proceedings under its rules. This was long-awaited considering that, in Brazil, 61 per cent of limited liability companies by shares (sociedades anônimas) provide arbitration clauses in their by-laws. In addition, 158 companies (41 per cent of all listed companies) have shareholders' agreements, of which 122 (77 per cent) contain an arbitration clause.2 In 2022, CAM-CCBC registered that 45 per cent of the disputes submitted to arbitration under the CAM-CCBC rules were disputes involving shareholders' agreements and share purchase agreements.3

The Corporate Arbitration Rules ("Corporate Rules") will apply to any arbitration initiated on or after 26 April 2023 pursuant to a statutory arbitration clause that designates CAM-CCBC rules in a company's articles of association or by-laws.4

Overview of the Rules

Supplementary Rules no. 02/2023 set out 14 articles:

  • Articles 1 – 3 and 13 – 14 lay out the scope of application of the Corporate Rules
  • Articles 4 – 5 provide a procedure for notification of the commencement of the arbitration
  • Article 6 gives powers to the CAM-CCBC presidency to consolidate arbitrations, in accordance with Article 19 of the Arbitration Rules
  • Articles 7 – 11 govern the joinder of additional parties to the arbitration proceedings
  • Article 12 gives powers to the CAM-CCBC presidency to suspend the arbitration proceedings whenever a party brings a new claim that falls within the scope of the Corporate Rules

Scope of application

The Corporate Rules supplement the Arbitration Rules and apply to new arbitrations under three

(cumulative) conditions:

  • The arbitral award may affect not only Claimant(s) and Respondent(s) but also the legal entity or its shareholders and/or directors ("Affected Third Parties").
  • The nature of the dispute subject to arbitration requires a uniform decision for all Affected Third Parties.
  • The by-laws or articles of association of the legal entity include a clause by which the parties agree that the arbitration will be administered by the CAM-CCBC and governed by the CAM-CCBC Arbitration Rules, under Article 1 of the CAM-CCBC Arbitration Rules.

Therefore, the Corporate Rules do not need to be explicitly referenced to apply as long as the arbitration clause refers to the Arbitration Rules.5
The Corporate Rules seem to apply only to three types of entities: limited liability companies by shares (sociedades anônimas), limited liability companies (sociedades limitadas) and partnerships (associações).6 Under Article 3 of the Corporate Rules, the CAM-CCBC has exclusive jurisdiction to decide on the application of the Corporate Rules, ex officio or at the parties' request.

Corporate law disputes may relate to: (1) the nullity of shareholder and/or board meetings or of decisions taken at such meetings; (2) the dissolution of the company, the withdrawal or exclusion of quota-holders, shareholders or members of the association, and the liquidation of assets; (3) liability of members of the governing bodies of the company; and (4) liability of shareholders, quota-holders or members of the association for the abusive exercise of their voting rights.7

Affected Third Parties

Whereas, in principle, arbitral awards only bind and produce effects vis-à-vis the parties to the arbitration, corporate law dispute awards may affect third parties. The Affected Third Parties shall be notified of the commencement of arbitration proceedings under Article 4, Section 2, of the Corporate Rules – and will be bound by the arbitral award regardless of whether they join the proceedings.

Parágrafo Segundo. Caberá à parte que tenha apresentado o requerimento de arbitragem realizar a Notificação dos Terceiros Afetados, na forma do artigo 5º deste Regulamento, devendo juntar a comprovação da realização de todas as notificações aos autos.

Claimant is required to notify all Affected Third Parties using a model notice prepared by the CAM-CCBC Secretariat, which contains the name of the parties, the amount/assets/rights in dispute and the relief sought. Claimant is also required to submit evidence of each applicable notification.8
Although the Corporate Rules do not expressly foresee it, a notification to the legal entity itself seems to be required whenever it is not a party to the arbitration. For publicly held companies which are required to publish the notice of corporate resolutions, the notice of arbitration shall be disclosed in the way such publication prescribes, pursuant to the regulations of the Brazilian Securities and Exchange Commission. As far as other legal entities are concerned, the procedure to be followed should be the one provided for in the respective by-laws and/or articles of association or, in their absence, in the law governing the legal entity.

The reason behind the notification to Affected Third Parties is to allow them to join the arbitration. Under Article 7 of the Corporate Rules, Affected Third Parties will have 30 days to react to the notice of arbitration and may request:

  • To join Claimant, and adhere to the relief sought
  • To join Respondent, and object to the relief sought
  • To join the arbitration as a non-party

Only after this 30-day period has elapsed will the CAM-CCBC Secretariat offer Respondent the opportunity to submit its Answer to the Request for Arbitration.

Affected Third Parties may nonetheless join the arbitration at a later stage, provided that they accept the arbitral proceedings in the state in which they are found at the time of the request for joinder, including the choice of arbitrators, if already made, as well as the submissions filed by the parties.9

Finally, Affected Third Parties may request the CAM-CCBC Secretariat to provide them with a link to access the entire records of the proceedings at any time, and will in that case be bound by the same confidentiality duties as the parties.10

1 See:
2 Mariana Pargendler, Viviane Muller Prado, Ezequiel Fajreldines Santos, Dalila Martins Viol, "Cláusulas arbitrais em números no mercado de capitais brasileiro", in Revista Brasileira de Arbitragem, CBAr, Volume XIX (2022), Issue 75, pp. 59-69. 
3 See:
4 CAM-CCBC, Corporate Rules, Article 14. 
5 CAM-CCBC, Corporate Rules, Article 1.
6 CAM-CCBC, Corporate Rules, Article 1.a.
7 CAM-CCBC, Corporate Rules, Article 2.
8 CAM-CCBC, Corporate Rules, Article 4.
9 CAM-CCBC, Corporate Rules, Article 10.
10 CAM-CCBC, Corporate Rules, Article 11.

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