Mandatory Arbitration of Intra-Corporate Disputes in Brazil: A Beacon of Light for Shareholder Litigation?

TILEC Discussion Paper No. DP2020-008

European Corporate Governance Institute - Law Working Paper No. 525/2020

Cambridge International Handbook of Class Actions (Brian Fitzpatrick & Randall Thomas, eds.) (Cambridge University Press, 2020, forthcoming).

33 Pages Posted: 6 Apr 2020 Last revised: 9 Jun 2020

See all articles by Patricia Gil Lemstra

Patricia Gil Lemstra

Tilburg University Law School

Joseph A. McCahery

Tilburg University - School of Law; European Banking Center (EBC); Tilburg Law and Economics Center (TILEC); European Corporate Governance Institute (ECGI)

Date Written: April 2, 2020

Abstract

We survey law firms, firms and institutional investors to better understand their preferred method of intra-corporate dispute resolution in Brazil. Consistent with a number of theories, we find that these organizations prefer arbitration to judicial claims as the method of intra-corporate dispute resolution. Our findings suggest that their choice of arbitration is based on the parties’ preferred ranking of objectives: quality of the decision; time to resolution; and costs. We find that parties choose to resolve disputes involving up to US$ 2.5 million through mediation or conciliation. We also find that arbitration and mediation or conciliation are almost equally preferred methods for intra-corporate dispute resolution involving values above US$ 2.5 million.

Keywords: Arbitration, Shareholder Litigation, Mandatory Arbitration Provisions, Mediation

JEL Classification: K22, K41, K42

Suggested Citation

Gil Lemstra, Patricia and McCahery, Joseph A., Mandatory Arbitration of Intra-Corporate Disputes in Brazil: A Beacon of Light for Shareholder Litigation? (April 2, 2020). TILEC Discussion Paper No. DP2020-008, European Corporate Governance Institute - Law Working Paper No. 525/2020, Cambridge International Handbook of Class Actions (Brian Fitzpatrick & Randall Thomas, eds.) (Cambridge University Press, 2020, forthcoming)., Available at SSRN: https://ssrn.com/abstract=3566985 or http://dx.doi.org/10.2139/ssrn.3566985

Patricia Gil Lemstra (Contact Author)

Tilburg University Law School ( email )

Tilburg, 5000 LE
Netherlands

Joseph A. McCahery

Tilburg University - School of Law; European Banking Center (EBC) ( email )

Warandelaan 2
Tilburg, 5000 LE
Netherlands
+31-(0)13-466-2306 (Phone)
+31-(0)13-466-2323 (Fax)

Tilburg Law and Economics Center (TILEC)

Warandelaan 2
Tilburg, 5000 LE
Netherlands

European Corporate Governance Institute (ECGI)

c/o the Royal Academies of Belgium
Rue Ducale 1 Hertogsstraat
1000 Brussels
Belgium

HOME PAGE: http://www.ecgi.org

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