2018-07-04 17:38:45 - 8

Brazilian legislation does not prohibit the formalization of contracts in foreign currency

There is no prohibition under Brazilian law regarding the formalization of contracts in foreign currency. What is effectively prohibited is effective payment in a currency other than the Real. Articles 315 and 318 of the Civil Code, Article 1 of Decree-Law 857/69, and also Article 1 of Law 10,192/01 prohibit payment in foreign currency, but not the preceding contract. The Superior Court of Justice, when faced with the issue, has already decided that: ""Despite this, the understanding was pacified in the STJ that contracts concluded in foreign currency are legitimate, provided that the payment is effected by the conversion in national currency” (Resp 804,791). Thus, the formalization of a contract in foreign currency is not prohibited by law, being prohibited, however, that the effective payment of the amount contemplated in the instrument is different from the Real. CBR Legal Advice