Civil law rigidity holding back class action development in Latin America - IBA panel

Brazil leads way on class action law in the region, but others such as Argentina lack specific legislation

The class action panel at the IBA Latin America regional forum in Lima

The development of collective proceedings has been uneven across Latin America given more rigid civil law structures in the region that have been designed to protect individual rights, says Peruvian lawyer Jose Tam, who was co-chairing a class action panel at the International Bar Association’s (IBA’s) Latin America regional forum in Lima.

Speakers at the session – Class actions: Latin-style – discussed the challenges of pursuing collective proceedings in the region and how conditions compare across countries.

For example, while Latin American class action cases are on the rise, most cases are being filed in the US and Europe, said Jones Day lawyer Fernando Pastore.

However, where cases are being brought in the region, the key differences between jurisdictions is how cases move through the local courts, which tend to be much slower than, say, the US where the process is faster and the unpredictability of jury trials means defendants feel very pressured to settle, Pastore said.

One country that is leading the way on class actions in Latin America is Brazil, which pioneered on enacting legislation on collective lawsuits back in 1985 in an effort to expand access to justice, said Deborah Fernandes, a lawyer at Machado Meyer in São Paulo.

To underscore the size of the market, there are currently 149,000 collective lawsuits pending in Brazil, with a lot of focus on financial institutions and environmental issues, Fernandes said. She expects more antitrust-related matters to be included in future collective proceedings due to recent legislation around anti-competitive actions in Brazil.

Argentina, by contrast, has a long tradition of creating procedural rules through case law when there has been an absence of specific legislation. So while there is not a specific law regulating class actions, there was a constitutional reform that recognised the possibility of representing collective rights before the courts, said Maria Morena del Rio, a lawyer at Allende & Brea in Buenos Aires.

However, while the Supreme Court has ruled on certain cases where it has deemed there is a collective interest, “if we continue to lack legislation, we will never develop to a class action”, she added.

While bills have been presented to create a class action law in Argentina, it has not been a priority for Congress. She said: “We are waiting. We need to change, we cannot continue with 12 year-long lasting trials.”

The session was co-chaired by Tam and Chilean lawyer Benjamin Grebe.


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