Section III Brazilian Courts and WTO-Related Matters
C) The Brazilian Judiciary Power and Jurisdiction over WTO-Related Matters
This sub-section presents an overview of the Brazilian Judiciary Power (1), centred on the aspects which improve understanding of distribution of jurisdiction over WTO-related matters among different courts (2). Hence, it does not provide an exhaustive account of the different courts and their jurisdiction. Rather, this section refers to those aspects relevant to adjudicating WTO-related matters. Finally, it provides an overview of the amount and types of litigation in WTO-related matters before Brazilian courts, setting the scene for the empirical investigation (3).
1) Overview of the Brazilian Judiciary Power and WTO-related matters
367 BRAZIL. Supremo Tribunal Federal (Supreme Court). ADPF 101. Petitioner: President of Brazil.
Rapporteur: Justice Cármen Lúcia. Brasilia, 24 June 2009, 98 <
http://redir.stf.jus.br/paginadorpub/paginador.jsp?docTP=AC&docID=629955 > Accessed 06 August 2019.
368 BRAZIL. Supremo Tribunal Federal (Supreme Court). ADPF 101. Petitioner: President of Brazil.
Rapporteur: Justice Cármen Lúcia. Brasilia, 24 June 2009, 272-3 <
http://redir.stf.jus.br/paginadorpub/paginador.jsp?docTP=AC&docID=629955 > Accessed 06 August 2019.
As a federal country, Brazil has both state and federal courts. The Brazilian Judiciary Power comprises the following bodies: the Supreme Court; the National Council of Justice; the Superior Court of Justice; the Superior Court of Labour; the Superior Electoral Court; the Superior Military Court; Federal Courts of Appeal and federal judges; Labour Courts of Appeal and labour judges; Electoral Courts of Appeal and electoral judges; Military Courts of Appeal and military judges; and finally, State and Federal District Courts of Appeal and judges. The Judiciary Power’s institutional framework is established in the third chapter of the Brazilian Constitution.
Except for state courts and those of the Federal District, which have residual jurisdiction, the Constitution enumerates fields of jurisdiction for all other bodies. Generally, whenever private persons sue state governments or agencies, state courts must handle the case. When they sue federal government or federal agencies, federal courts have jurisdiction. When private persons sue both state and federal bodies, the Federal Justice prevails.
Article 102 of the Constitution regulates the Supreme Court’s jurisdiction. As the last word on constitutional matters, it can rule on extraordinary appeals on constitutional matters filed against the decisions of State and Federal Courts of Appeal, and of the Superior Court of Justice.
Similarly, Article 105 of the Constitution regulates the Superior Court of Justice’s jurisdiction. It may examine appeals – known as ‘special appeals’ – against rulings of the Federal or State Courts of Appeals, or the Court of Appeals of the Federal District. These can be filed in three situations: first, if the appealed decision contradicts or denies effectiveness to an international treaty or a federal law; second, if it validates an act of the local government contested in relation to a federal law; and third, if it interprets a federal law in a manner divergent from another court’s interpretation. As such, the Superior Court of Justice may rule on special appeals filed against decisions of both State and Federal Courts of Appeal.
It also has the last word on interpreting federal law; such rulings may only be challenged on constitutional grounds before the Supreme Court.
Within the aforementioned contexts, the Supreme Court or the Superior Court of Justice may hear appeals of rulings from Federal or State Courts of Appeal. Depending on the grounds of appeal, such rulings can be the object of one single appeal, either to the Superior or the Supreme Court. However, they can also be simultaneously appealed to both Courts. Here, two appeals challenge the same ruling, one directed to the Supreme Court, and the other to the Superior Court of Justice. None of the superior courts, however, can examine factual matters, only legal ones.
Therefore, the Federal and State Courts of Appeal give the last word on facts and evidence.
Brazil has five Federal Courts of Appeals, each with jurisdiction over different Brazilian states. The First Region comprises the territories of the Federal District and of the states of Acre, Amapa, Amazonas, Bahia, Goias, Maranhao, Minas Gerais, Mato Grosso, Para, Piaui, Rondonia, Roraima and Tocantins. The Second Region covers the territories of Rio de Janeiro and Espirito Santo. Sao Paulo and Mato Grosso do Sul form the Third Region. The Fourth Region encompasses the states of Parana, Santa Catarina, and Rio Grande do Sul. The Fifth Region includes the states of Alagoas, Ceara, Paraiba, Pernambuco, Rio Grande do Norte, and Sergipe.
Each court encompasses various Judiciary Sections and Divisions, corresponding to the first instance of the Federal Justice. According to Article 109 (III) of the Constitution, federal judges have jurisdiction over cases grounded in international treaties. Federal Courts of Appeals of the respective region have jurisdiction to rule on appeals filed against first-instance decisions in such cases.
2) Jurisdiction Over WTO-Related Matters: The Problem of State Courts As shown previously, the federal courts have jurisdiction over cases based on international treaties. Therefore, whenever a case involves a
WTO-related matter, federal courts have jurisdiction over the matter.
Unfortunately, the vast majority of state courts continues to adjudicate on WTO-related matters whenever the respective states are sued for violations thereof – mostly, in cases affecting state taxes. They do not justify their jurisdiction, which indicates that they are possibly not aware of the fact that these matters are accorded to federal jurisdiction only.
Moreover, when adjudicating special appeals filed against state courts’ decisions on WTO-related matters, the Superior Court of Justice usually examines the merits of the case, taking for granted the jurisdiction of state courts. The appropriate response would be annulling the states’
rulings ex officio because of the lack of jurisdiction on the part of state courts. The Superior Court of Justice, however, seems to suffer from the same lack of awareness in relation to the fact that WTO-related matters are exclusively accorded to federal jurisdiction.
The Supreme Court has long ruled that the Federal Courts have sole jurisdiction over cases based on international treaties. These Supreme Court rulings have even been passed in individual369 appeals predating the Constitution of 1988. In such appeals, the court has repeatedly affirmed the jurisdiction of the Federal Justice over cases grounded in international treaties, even if they involve state taxes.370
In 2010, Justice Cármen Lúcia ruled on this matter once more, in a case filed by importers of codfish against the state of Pernambuco. The complainants based their arguments on the GATT, arguing that since a certain kind of domestic fish – dried and salted – benefitted from a state tax exemption, the imported codfish, which was a like product, should also benefit from it.
The Federal Court of Appeals of the Fifth Region had denied jurisdiction over the case and nullified a first-instance ruling on it. Its decision stated that, since the case concerned a state tax, a state court in Pernambuco should adjudicate it. The complainants appealed to the Supreme Court, arguing that the decision of the Federal Court of Appeals violated Article 109 (III) of the Brazilian Constitution. Since the complaint was based on the GATT, Justice Cármen Lúcia reversed the decision of the Federal Court of Appeals, affirming the jurisdiction of the Federal Justice.371 Justice Teori Zavascki decided an analogous case in the same manner in 2013.372
More recently, in 2015, the Second Chamber of the Supreme Court ruled on appeals filed by the Federal Union and the State of Pernambuco against a decision of the Federal Court of Appeals of the Fifth Region, which had accepted and tried a similar case. Once more, the Supreme Court affirmed the competence of the Federal Justice to adjudicate cases that are grounded on international treaties, such as WTO agreements.373
369 By ‘individual appeals’, this thesis means appeals on individual litigations. The effect of the rulings of the Supreme Court, on these cases, is limited to the parties of the case, as opposed to, for example, rulings on direct actions of unconstitutionality, or others, which have erga omnes effect.
370 On this, see Justice Cármen Lúcia’s ruling on (STF 9 March 2010 RE 475.616 <www.stf.jus.br >
371 BRAZIL. Supremo Tribunal Federal (Supreme Court). RE 475.616/PE. Appellant: Comércio e Representações Lacerda Ltda. Appellee: União Federal (Federal Union). Rapporteur: Justice
Cármen Lúcia. Brasilia, 10 February 2010. <
http://stf.jus.br/portal/jurisprudencia/listarJurisprudencia.asp?s1=%28%28475616%29%29+NAO +S%2EPRES%2E&base=baseMonocraticas&url=http://tinyurl.com/y6b54uje> accessed 06 August 2019.
372 BRAZIL. Supremo Tribunal Federal (Supreme Court). AgRegREx 229.806/PE. Appellant: Comércio e Representações Lacerda Ltda. Appellees: União Federal e Estado de Pernambuco (Federal Union and State of Pernambuco). Rapporteur: Justice Teori Zavascki. Brasilia, 01 August 2013. <
http://stf.jus.br/portal/jurisprudencia/listarJurisprudencia.asp?s1=%28%28229806%29%29+NAO +S%2EPRES%2E&base=baseMonocraticas&url=http://tinyurl.com/y63bdg53 > accessed 06 August 2019.
373 BRAZIL. Supremo Tribunal Federal (Supreme Court). AgRegREx 781.136/PE. Appellant: Estado de Pernambuco (State of Pernambuco). Appellee: Comércio e Representações Lacerda Ltda.
Rapporteur: Justice Dias Toffoli. Brasilia, 27 October 2015. <
Without realising that this is a constitutional exception, state courts continue to follow the general notion that, whenever the complaint involves state courts or agencies, especially in relation to state taxes, they should handle the cases. Consequently, Brazil has, in total, thirty-four courts potentially exerting jurisdiction over WTO-related matters: the Supreme Court, the Superior Court of Justice, twenty-seven State Courts and five Federal Courts of Appeal. This entails a great risk of inconsistency, both internal and in relation to WTO case law, thus increasing the likelihood of fragmentation.
3)A general overview on repercussão geral, recursos repetitivos, súmulas vinculantes, and súmulas
In Brazil, there are different procedural techniques to deal with the high amount of cases before courts. Here, this thesis briefly explains the techniques found in the cases discussed in the empirical analysis.
The first technique is called repercussão geral- literally, ‘general repercussion’. This is a technique instituted by Constitutional Amendment 45/2004to limit appeals to the Supreme Court. Following the technique, appeals to the Supreme Court will only be reviewed if the Court first determines that the subject of the appeal has general repercussion.
Following this technique, once the Supreme Court admits an appeal, it can determine the suspension of all other appeals on the same subject matter in lower courts until it adjudicates the appeal. The Supreme Court’s ruling has a binding effect in all cases on the same subject matter.
Therefore, after the Supreme Court rules on the matter, the lower courts must lift suspension of the cases before them and rule them according to the Supreme Court’s ruling on the appeal with general repercussion.
A similar technique is used in relation to special appeals to the Superior Court of Justice that involve the same subject matter. Normally, it is the President or the Vice-President of lower courts who does the first admissibility analysis of appeals to the Supreme Court and the Superior Court of Justice. When receiving several appeals with the same subject matter, the President or Vice-President may select some of the appeals, which best represent the controversial matter at stake. These are the so called recursos repetitivos, literally ‘repetitive appeals’, which will then be sent to the Superior Court of Justice for adjudication. The selection is not binding on the Superior Court, which can select different appeals.
Moreover, the Superior Court Justices may also select appeals for this purpose, even when lower court judges have not done it.
Following the selection, all other special appeals on the same matter must be suspended in the lower courts. After the Superior Court of Justice rules on the matter, lower courts will lift suspension and adjudicate them according to the Superior Court’s ruling.
Súmula vinculante – literally ‘binding precedent’- is a kind of súmula issued by the Supreme Court on constitutional matters. Súmula refers to an entry in a register that reflects a court’s interpretation on a specific legal issue. All appeal and superior courts in Brazil have a body of súmulas, which are not binding but indicate the court’s jurisprudence on certain matters. Judges normally follow their court’s súmulas. Súmula vinculante, however, is a binding precedent, both on courts and all public bodies.
4) Setting the Scene
In the past five years, Brazilian courts issued over 400 rulings only on GATT-related matters. All cases have been filed by private persons against the federal or state government or agencies grounded on
http://stf.jus.br/portal/jurisprudencia/listarJurisprudencia.asp?s1=%28781136%29&base=baseAco rdaos&url=http://tinyurl.com/y4oqpnns > accessed 06 August 2019.
violations of WTO Law by acts of these entities. Interestingly, in Brazil, private persons are resorting to domestic courts to enforce their WTO-originated rights against government violations.
Against this background, it is noteworthy that a high number of cases filed before Brazilian domestic courts concerns goods that do not correspond to top Brazilian imports. Moreover, certain types of goods come from various different countries. Thus, there is a significant amount of pulverised interests whose protection is being sought after before domestic courts - from frozen vegetables coming from Belgium, France and other countries, to spices and herbs originating from Turkey, India or Egypt, to fish, cars for disabled people, medical equipment, fertilisers, or parts of airplanes from other distinct countries.
The amount of litigation involving pulverised interests indicates a potential role for domestic courts in the application and enforcement of WTO Law. Although more empirical research should be made to confirm this hypothesis – which is outside the scope of this thesis -, it is possible that by their atomised, individually small nature, importers and exporters involved could hardly join forces to trigger an international dispute before the WTO.374 Since an international dispute before the WTO involves high costs and strategic considerations on the part of Members, it is conceivable that many pulverised interests can only be protected from violations of the multilateral trading system rules - and consequently benefit from that system - through resort to domestic courts.
When isolated, pulverised interests might look irrelevant, for they are small; however, when added up, they might amount to significant numbers in a country’s economy. Hence, there might be a vast group of trade interests for which domestic courts could represent the only resort against violations of WTO rules.
The Brazilian legal system creates an environment which seems favourable for fragmentation of international law – and WTO Law - to occur. There are five reasons for this.
First, in Brazil, international treaties incorporated into the domestic legal system have direct effect. Second, all incorporated treaties have an infra-constitutional status. Third, Brazilian courts can choose to apply a different body of law to a given case where WTO law could also be applicable. Fourth, a great number of courts exert jurisdiction over WTO-related matters. Fifth, in interpreting WTO Law, judges might find difficulties linked to language and lack of specific training.
International treaties are incorporated into the Brazilian legal system with their own translated texts via a Presidential decree, and private parties may invoke them before Brazilian courts. This is the case of WTO agreements, already incorporated into the domestic order. As such, Brazilian courts interpret the treaty texts themselves, albeit translated, opening the door for inconsistencies with international interpretation.
Second, international treaties are subordinate to the Constitution.
WTO agreements, as well as all other incorporated treaties, have the status of ordinary federal laws in Brazil. This renders them subject to Brazilian courts’ constitutionality controls, making fragmentation more likely.
Third, the Supreme Court’s approach in Brazil-Tyres indicates that Brazilian courts may apply a different body of law to cases where WTO Law would also be applicable. Differently from WTO adjudicating bodies, they do not have a mandate limited to the WTO agreements. Even if WTO adjudicating bodies can consider other bodies of law, they must do so through provisions of the WTO agreements. By contrast, the Brazilian courts’ jurisdiction is much broader, and so is their choice of laws.
Brazilian courts might assess and adjudicate disputes through the prism
374 Mancur Olson, The Logic of Collective Action, Public Goods and the Theory of Groups (Kindle Edition, Harvard University Press 1971); Peter Rosendorf, ‘Domestic Politics and International Disputes’ in Lisa L. Martin (ed), The Oxford Handbook of the Political Economy of International Trade (Kindle Edition, OUP 2015).
of Brazil’s international commitments regarding environmental protection, for example, instead of through the lens of international trade relations. This also opens the door to potential incoherence.
Fourth, although the Brazilian Constitution restricts competence to adjudicate cases grounded in international treaties to the Federal Justice, several state courts have been exerting jurisdiction over WTO-related matters. Indeed, such a large number of courts whose jurisprudence is not harmonized can yield serious inconsistencies in interpretation. While the Superior Court of Justice may play a role in harmonizing treaty interpretation, this may take a long time, during which inconsistencies might prevail.
Five, Brazilian judges are not trained in WTO Law and lack specialized knowledge of the subject. This, coupled with language barriers to access WTO adjudicating bodies’ rulings, is another factor that can contribute to inconsistency.