Amendment to the Brazilian Code of Civil Procedure in 2023 brought greater legal certainty to Brazilian and foreign financial institutions, fintechs, funds, and other organizations in the use of electronically issued credit instruments to grant and assign credit.
In summary, Federal Law 14.620, dated July 13, 2023, added §4 to art. 784 of the Code to provide that extrajudicial enforceable instrument, such as Banking Notes, Promissory Notes, Debt Confession Instruments, among others, may be “constituted or attested by electronic means”, with “any type of electronic signature provided for by law being allowed, waiving the signature of witnesses when their integrity is checked by a signature provider.”
See below 3 points about this legal innovation:
1. What Does the Amendment to the Brazilian Code of Civil Procedure Favor Electronically Issued Credit Instruments? The new Federal Law 14.620 added §4 to art. 784 of the Code to provide that extrajudicial enforceable notes, such as Bank Notes, Promissory Notes, Debt Confession Instruments, among others, may be “constituted or attested by electronic means”, with “any type of electronic signature provided for by law being allowed, waiving the signature of witnesses when their integrity is checked by a signature provider.”
2. With the New Law, May Extrajudicial Enforcement Instruments Be Signed on Platforms Accredited or Not at ICP Brasil? Yes, with the addition of §4 to art. 784 of the Code, extrajudicial enforcement instruments, such as credit instruments (CCBs, Promissory Notes, Commercial Notes, etc.) and instruments such as Debt Confessions, Loan Agreements, may be issued and signed electronically through platforms accredited or not in the ICP Brazil.
This legal innovation eliminates the legal risk of judicial discussions that were taking place where debtors questioned in court the executive effectiveness of an electronically signed document without the certifying entity being accredited in the Brazilian Public Key Infrastructure – ICP Brasil.
3. Who Benefits From the Possibility to Electronically Issue and Sign Extrajudicial Credit Notes? The legal innovation in the Brazilian Code of Civil Procedure gives greater legal certainty to credit operations in Brazil, benefiting financial institutions, fintechs, funds, and other organizations that use executive instruments, such as credit notes and other contracts, issued and signed electronically to grant and assign credit.
The innovation in the Brazilian Code of Civil Procedure will bring greater legal certainty to electronically structured credit operations, benefiting financiers and borrowers.
