Business law and the updating of the Code of Civil

On September/23, at the initiative of the president of the Federal Senate, Rodrigo Pacheco, the Commission of Jurists responsible for reviewing and updating the Civil Code was created, chaired by the minister of the STJ, Luis Felipe Salomão.

The Commission of Jurists concluded on 4/5/241 the analysis of the final report, which was presented to the plenary of the Federal Senate on 4/17/242. From now on, the Senators will analyze the proposal sent by the committee of Jurists, which will be filed as a bill by the president of the Federal Senate.

To update the aspects involving Business Law, the subcommittee on Business Law was established, which sought to promote adjustments in the discipline and interpretation of business, with reinforcement of private autonomy, taking into account aspects that are typical of these businesses, seeking legal certainty and greater predictability, adopting the theses that are consolidated by the STJ to settle understandings of the Superior Court.

Among the suggestions for innovations and updates proposed in the final report3, it is worth mentioning the creation of an article that brings principles of business law, inserted in Article 966 – A, which thus provides:

• “Art. 966-A. the provisions of this book should be interpreted and applied with a view to stimulating entrepreneurship and increasing a favorable environment for business development in the country, observing the following principles:

• freedom of initiative and the enhancement and improvement of human capital;

• freedom of Organization of entrepreneurial activity, in accordance with the law;

• of private autonomy, which will only be removed if there is a violation of legal norms of public order;

• of equity autonomy, of legal entities, according to their corporate type;

• limitation of the liability of the partners, according to the corporate type adopted, in accordance with the legal terms

• majority resolution of the share capital, unless otherwise provided in the articles of incorporation;

• of the mandatory force of the conventions, provided that they do not violate norms of public order.

• preservation of the enterprise, its social function and stimulation of economic activity;

• of the observance of uses, practices and customs when the law and the interested parties refer to them or in situations not legally regulated, provided that they are not contrary to law;

• of simplicity instrumentality of forms.”

In the same vein, specific rules for business contracts were created, in addition to their own rules of interpretation, in harmony with the principles transcribed above, as provided for in Article 421-C:

“Art. 421-C. civil and business contracts are presumed to be equal and symmetrical, if there are no concrete elements that justify the removal of this presumption, and are thus interpreted by the rules of this code, subject to the legal regimes provided for in special laws.

Sole paragraph. For their interpretation, enterprise contracts require the following additional parameters of consideration and analysis:

• the contractual types that are naturally disparate or asymmetric, typical of some business relationships, must receive the specific treatment that is contained in special laws, as well as the contracts that arise from the incidence and functionality of General Clauses specific to their modalities;

• business good faith is also measured by the common expectation that the agents of the economic sector of activity of the contractors have, as to the nature of the business concluded and as to the loyal behavior expected of each party;

• in the absence of specific wording of clauses necessary for the execution of the contract, the judge will use the uses and customs of the place of its conclusion and the common way adopted by entrepreneurs for the conclusion and execution of that specific type of contract;

• in general, post-contractual non-competition clauses are lawful, provided that they do not violate the economic order and are consistently limited in space and time, by reasonable and well-founded contractual clauses;

• the natural atypical nature of business contracts;

• business secrecy must be preserved.”

As noted, there is a clear intention to reinforce, through Express and specific foresight, the need to respect the principle of private autonomy in business relations, which consists of the power recognized by the legal order to individuals to dispose of their interests, especially economic ones (negotiating autonomy), freely conducting legal business and determining the respective effects (PRATA, Ana. Constitutional protection of private autonomy. Coimbra: Almedina, 1982, p.11)4.

Private autonomy, although modernly it has given way to other principles (such as good faith and the social function of the contract), is still presented as the cornerstone of the system of private law, especially in terms of Business Law.

Its immediate presupposition is freedom as a juridical value. Mediately, ethical personalism also appears as a foundation, with the conception that the individual is the center of the legal system and that his will, freely expressed, must be protected as an instrument for achieving justice (AMARAL NETO, op.cit. p. 17).

The principle is embodied, fundamentally, in contract law, through a threefold dimension: contractual freedom, the binding force of pacts and the relativity of contracts.

Contractual freedom represents the power given to the parties to choose the business to be concluded, with whom to contract and the content of the contractual clauses. It is the wide range of autonomy granted by the legal system to the manifestation of the will of the contractors.

On the other hand, the binding force of contracts is the counterpoint of contractual freedom. If the agent is free to carry out any legal business within civil life, he must be responsible for the acts carried out, since contracts are concluded to be fulfilled (pacta sunt servanda).

Judicial control over clauses in business contracts is more restricted than in other sectors of private law, since negotiations are initiated between professionals in the business area, observing rules usually followed by members of this sector of the economy.

This is the consolidated understanding that has been adopted repeatedly by the state courts and by the STJ, which is also a consensus in the doctrine on the subject, so it is commendable the intention of the committee of Jurists to reinforce such points, through the express provision of these issues in the Civil Code, in order to achieve greater security and predictability in business relations.

Finally, just for information, the draft amendment to the Civil Code also changed the regulations of foreign companies operating on national soil, requiring them to have headquarters and legal representative in Brazil for their regular operation.

The State Council of Commercial Law of FEDERAMINAS will continue to monitor the legislative process involving the reform of the Civil Code, with regard to Business Law, in order to keep the commercial and Business Associations of the state of Minas Gerais informed and updated on the subject.

1 available in: https://www12.senado.leg.br/noticias/audios/2024/04/comissao-de-juristas-para-revisao-do-codigo-civil-conclui-relatorio-final

2 https://www12.senado.leg.br/noticias/audios/2024/04/anteprojeto-do-novo-codigo-civil-e-apresentado-em-plenario

3 https://legis.senado.leg.br/comissoes/comissao?codcol=2630

4 AgInt nos EDcl no REsp n.1.902.149/DF, rapporteur Minister Paulo de Tarso Sanseverino, Third Class, judged on 3/4/2023, DJe of 27/4/2023.