Choice of Law in International Contracts and Efficiency: Insights from the Brazilian System and Correspondent Case law (2004-2015)

Abstract

While discussing efficiency in international contracts choice of law, one approach prescribes three elements as guidance: (i) party autonomy; (ii) allocation of the burden of proof of foreign law to parties; and (iii) protection of certain categories in asymmetric information situations. However, the way that the “efficient framework” relates to the Brazilian system has been practically ignored. Thus, this paper submits a set of cases, gathered from the author´s prior empirical research, to hypothetical efficient elements in choice of law. The paper suggests that the Brazilian system reflects mixed elements: (i) choice of law is rigid, but it does not necessarily impair efficiency; (ii) burden of proof follows the prescribed orientation; and (iii) the potential interpretation of protected categories (e.g. consumers) can affect the internalization device of information asymmetry. However, whereas Courts interpret these rules in tandem, most decisions resulted in efficient choice of law outcomes.