With the enactment of Constitutional Amendment N.º 45 (dated 31 December 2004), the jurisdiction to hear requests for recognition and enforcement of foreign judgments (including arbitral awards) was transferred from the Brazilian Supreme Court of Justice (Supreme Court) to the Brazilian Superior Court of Justice (Superior Court).

The Supreme Court has jurisdiction to hear all claims that raise questions about the constitutionality of decisions rendered by lower courts (including the Superior Court), by means of an extraordinary appeal. However, any extraordinary appeal must first be confirmed by an admissibility trial. This procedure ensures that the proposed extraordinary appeal relates to a possible violation of constitutional principles and is of general significance. If the lower court finds the appeal admissible, the Supreme Court may nevertheless rule again on that issue.

The foreign arbitration award in question involved a Brazilian company and a French company, the respondent and claimant respectively. The parties were counterparties in an international consortium involving electrical supply in an African country. An arbitration was undertaken according to the ICC Arbitration Rules and an award was issued in May 2003. The arbitral tribunal found the respondent liable for the damage caused to the claimant, who requested recognition and enforcement of the award before the Superior Court. The Superior Court granted recognition of this foreign arbitration award through an unanimous decision on 3 October 2007 (Case SEC N. º 831).

After the Superior Court had confirmed the recognition of the foreign award, the respondent filed requests for clarification, which were all denied. As a last resort to reverse the Superior Court's decision, it filed an extraordinary appeal to the Supreme Court alleging constitutional violations. Never before had an extraordinary appeal passed the admissibility trial and reached the Supreme Court.

The respondent alleged that the Superior Court's decision harmed the principles contained in Articles 1º, I and 5, XXXV, XXXVI and LIV of the Federal Constitution. These provisions are highly general articles which contain very broad principles:

The Justice acting as Vice President of the Superior Court, in a sole decision issued on 29 September 2008, found that the decision might indeed harm the Constitution and that it was reasonable to conclude that it raised issues of general significance. Thus, it admitted the extraordinary appeal and submitted the case to the Supreme Court.

This was the first case in which an extraordinary appeal was admitted before the Superior Court and sent to the Supreme Court. The Supreme Court then re-examined the issue of admissibility.

On 20 January 2009, the Vice-President of the Supreme Court found by a sole decision that the extraordinary appeal (Case RE N.º 595276) was not admissible. The Supreme Court reasoned that the appeal did not fulfil the procedural admissibility requirement, in that constitutional violations had not been raised before the Superior Court, and the Superior Court had not addressed such matters. Furthermore, the Supreme Court held that, even if the issue had been raised before the lower court, the matters relied upon did not amount to direct violations of the Constitution. The respondent has applied to review that decision, but no final decision on that issue has yet been made.

The question of whether decisions on enforcement might be challenged by way of extraordinary appeal had been the subject of some debate in the Brazilian arbitration community. Case SEC N.º 831 was the first extraordinary appeal to be admitted before the Superior Court and to reach the Supreme Court. However, the Supreme Court's denial of the admissibility of the extraordinary appeal illustrates that, while in theory such appeals are a possibility, the threshold for such appeals is extremely high. Thus, the Superior Court's decisions on recognition of foreign arbitral awards are most likely to remain the final word on the subject, and award debtors are most unlikely to be able to use the extraordinary appeal procedure as a means of evading enforcement.

Cases SEC N. º 831 and RE N.º 595276