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The change in understanding about arresting individuals with pending appeals and the economic consequences for Brazil

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Breno Torquato

The Brazilian Federal Supreme Court ruled, on November 7, 2019, by a narrow decision (6 votes in favor and 5 against), for revoking the possibility of arresting convicted defendants before all possible appeals are exhausted in court. Until such decision, the understanding of the Supreme Court was that the arrest after the denial of the defendants’ first appeal was possible (not mandatory, but possible).

Now congresspeople and senators rush to come up with proposals for bills and constitutional amendments in order to try to reverse such ruling and maintain the previously held understanding on the subject. However, such bills and amendments, if approved, may be discussed judicially and any new change may be revoked again.

Moving away from the political spectrum of the decision, one may conclude that legal uncertainty in Brazil remains large. In a very short time, two completely divergent decisions about the same matter were ruled by the same members of the country’s Supreme Court (in 2016 the Supreme Court had ruled that it was possible to jail an individual after the first appeal had been dismissed). In addition, another power (the Legislative branch) wishes to change this new understanding. After all, what is the final decision on the matter? How to explain this situation to a foreign investor? How do we Brazilians justify to a foreign national or country that our institutions are solid, and decisions are made based on law and not in the heat of the moment?

This jurisprudential instability is generally seen by foreign nationals as a source of uncertainty regarding the country, which cannot even define understandings in the last instance of the Judicial system. The investment risks are high when it comes to investing in a country where the Supreme Court is contradicting itself in such a short time.

For Brazil to regain its economy (and investment grade) and return to acceptable levels of economic growth, an effort is required from the Brazilian institutional powers. In other words, it is necessary to clean the house and show the world that the country and its institutions are serious and committed to democracy and institutional order.

Just as “Caesar’s wife must be above suspicion”, Brazil’s internal organization and solid institutions must also be above suspicion — and decisions such as this one demonstrates the exact opposite that is being made public to the world and to foreign investors.

Breno Torquato is a lawyer of Drummond Advisors in Belo Horizonte. He specializes in assisting multinational companies doing business in Brazil and migrating businesses to the country.