E-commerce Law in Brazil

It is quite common for companies from other countries and also national companies to opt for the practice of e-commerce to act in the Brazilian market. Many of these commercial actors, especially foreigners, have doubts about the laws applicable to e-commerce in Brazil.

Although Brazil does not have a specific law on the matter, there are several provisions and legal instruments that constitute the regulation of this activity. Check out some important Brazilian legal system standards for e-commerce!

Applicable rules to e-commerce in Brazil

Brazil has no specific law regarding e-commerce. However, the e-commerce practice must comply with the consumer protection regulations, dispersed in diverse norms from the Brazilian legal system. Among them, we remark the following:

– Consumer Defense Code – CDC (Law 8.078/90): the CDC provides the basis for any consumer relation, whether it happens through the internet or not. It provides the concepts related to consumption relations, as well as duties and rights.

Legally, the Code is applied to consumption relations, that may include not only B2C (business-to-consumer), but also B2B (business-to-business) situations. The main concept involves the natural or legal person being the final user of the good or service being provided. That is to say, if an e-commerce client is a company (and not a natural person) it may also constitute a consumption relation, as long as it is the final user. If not, the relation is considered a commercial one and follows the legal regime of the Civil Code (Law 10.406/2002).

Among the most important consumer’s rights is the right to information (article 6 of CDC). It means that the e-commerce must provide specific, transparent and accurate information regarding the product or service provided, the offer, terms and conditions. The code also expressly prohibit discretionary action against consumers (article 4).

– Decree n. 7.962/2013: this is the only specific rule for e-commerce in Brazil. The Decree aimed to actualize the CDC, which is from 1990, but it does not revogate it. It also establishes mandatory information for the e-commerce websites:

1. Provider identification (complete legal or natural name);
2.  Web and physical address;
3.  As the CDC, clear and accurate information about the offers, products, services, delivery and availability;
4. Summary of the most important points of the contract (e.g. payment conditions and deadlines);
5. Full contract with detailed information;
6. Confirmation of the purchase;
7.  Information regarding customer service by email, chat or telephone.

A security system to avoid data breaches is also mandatory according to the Decree and the consumer also has the “right to regret”. It means that the consumer can give the contract up anytime before receiving the product and the cancellation must be confirmed by the provider, or after seven days from the receipt date. In both cases, the provider must communicate the payment agency immediately after the cancelation in order to reverse it.

– Brazilian Civil Framework of the Internet  (Law n. 12.9655/2014): it defines the principles to regulate the internet in Brazil. Therefore, they are applicable to e-commerce. The Internet Bill of Rights establishes privacy, data protection, consent and information security as rights to internet users (articles 3, 7 and 16 of the Bill).  According to article 11, the Brazilian Law system is applicable to any activity, including thus, international e-commerce:

Article 11. In any operation of gathering, storage, custody and treatment of records, personal data or communications by connection and internet application providers in which at least one of these acts occurs in national territory, the Brazilian law and the rights to privacy, protection of personal data and the confidentiality of private communications and records must be mandatorily respected.

– General Data Protection Law – LGPD (Law n.13.709/2018): The LGPD will come into force in 2020, and highlights the relevance of express consent, transparency and data protection online. Therefore, e-commerce must comply with the new rule.  

– Civil Procedure Code – CPC (Law n. 13.105/2015): according to the CPC, Brazilian courts are competent to judge cases involving consumption relations, if the consumer is domiciled or has habitual residence in the country (article 22, b, II). The rule is based on the consumer’s protection and best interest, as well as on the principle that the consumer is the most fragile, settled by the CDC. Therefore, Brazilian consumers have the option to sue an international e-commerce company at domestic courts, even if the company was constituted or has headquarters in different countries.

– Law n. 10.962/2004, which states about sales and ways to display the price of goods and services to the consumer, was altered by Law n. 13.543/2017, which establishes that in e-commerce it should be made highlighting its price in cash together with the product’s image or service description, in easily readable font and above size twelve.

How is e-commerce law in practice?

The applicable law to e-commerce in Brazil is mainly based on consumer protection. This is why companies must follow rules regarding information, transparency and security. There are special regulations for specific fields of e-commerce, such as those involving health, foodstuffs, marketing, and credit systems. Rules regarding intellectual property rights, mainly trademarks and copyright, also have to be observed.

The competence to fiscalize consumption relations in Brazil is of the Attorney’s Office (Ministério Público), according to the article 129, III of the Brazilian Constitution. The Attorney’s Office of each federal state in Brazil has an administrative program for the consumer protection and defense, called PROCON. PROCON (Programa Estadual de Proteção e Defesa do Consumidor) is responsible for receiving consumers’ complaints and investigating practices against consumers’ rights. If PROCON’s procedure indicates violation of the law, the Prosecutor of the state legally charges the company on the infraction, at criminal or civil justice, depending on the nature of the violated rule.

The majority of litigations regarding consumption are adjudicate by Special Courts  (Juizados Especiais) of each state. The Special Courts are competent to judge cases which value are up to 20 minimum-salaries, without a lawyer assistance, or up to 40 minimum-salaries, if the suit’s parts are assisted by lawyers. The minimum-salary in Brazil currently is R$998,00 reais.

Considering that, in practice, many companies do not comply with  consumption rules, there is a huge number of cases in the Brazilian Judiciary. According to the National Justice Council (Conselho Nacional de Justiça – CNJ) report, consumption was the third field that had more new disputes taken to the Courts in Brazil in 2018 – with 365,309 new cases (among a total of 2.623.354 new cases from all fields covered in State Justice) in comparison to the number of cases in 2017.

How to adapt my e-commerce?

The activity of e-commerce must follow the rules mentioned in this post and also to be attentive to the sectoral regulations – mainly those of sanitary order.

In general, some actors, such as SEBRAE (the Brazilian Support to Micro and Small Company’s Service), offer courses and materials to those who seek to adapt electronic commerce to the Brazilian system. One of these manuals, which also served as a reference for this post is the legal manual, available here.