Caution of Justice must be adjust to economic dynamism
Author: Aline Pinheiro
Source: Legal Consultant, 06/10/2007
It is a fact that Judiciary and Economics have a different time. While justice is naturally slower, as everything has to be well analyzed so that injustices are not committed, the economy is dynamic. Just spend a few hours on a stock exchange to see how everything changes in seconds. The challenge, for economists and members of the legal community, is to integrate the two areas, since one influences the other.
This need for payment was the subject of the second seminar of the debate cycle promoted by the Brazilian Institute of Ethics in Competition (Etco), in São Paulo, on Thursday (4/10). The purpose of the event was to analyze the influence of judicial decisions in the Economy and economic decisions in Justice.
"There is almost a rivalry between magistrates and economists," acknowledged Minister César Asfor Rocha, of the Superior Court of Justice. He admits that legal certainty and speed are two conflicting principles. The more protection the citizen is given, the longer the trial takes in the Judiciary.
This clash between the dynamism of the Economy and the caution of the Judiciary is evident when analyzing the balance of judgments in the Administrative Council for Economic Defense (Cade). From 2000 until September 2007, Cade condemned or restricted practices in the market in 269 processes of the total that arrived there. Each year, more than a hundred cases involving Cade reach the Judiciary. These data show how important the two tried to integrate, as the defense of competition almost invariably ends in court.
Elizabeth Farina, Cade's president, presented cases in which the delay of Justice prevents the effective application of what Cade decided. For example, in the case of the flat steel cartel. Cade condemned the cartel in 1999. To date, the conviction has not been applied because the issue is being discussed in court. Another more striking example of time shocks is the rebar cartel. The administrative judgment was suspended for six years due to court injunctions. In 2005, it was finally concluded, but until now it is awaiting a judicial resolution for the administrative conviction to be applied.
For Elizabeth, this judicial delay combined with the fact that operations in Brazil are analyzed a posteriori - for example, a merger is only analyzed after it occurs - encourages companies to seek the Judiciary. Thus, while the Justice does not decide, they can continue with the practices, often harmful to the market. When, in fact, the conviction arises, which may be a fine or an obligation to do and not to do, it may have ceased to make sense due to the dynamics of the Economy. Sometimes, Elizabeth warns, the damage to the community is irreversible.
Protection of the weak
For the economist and former Minister of Finance Maílson da Nóbrega, there is another characteristic of Brazilian Justice that causes harmful effects on the country's economy. "We are heirs to the tradition that the state has to protect the underprivileged." For Nóbrega, it is a Brazilian custom to disrespect contracts and, in its eagerness to protect the weakest, the Judiciary is part of that custom. “The role of the judiciary should be to enforce contracts and protect property rights.”
For the economist, the anti-creditor view that he sees in the Brazilian Justice scares investments. This reduces legal certainty and, consequently, financing, he says. “Rio Grande do Sul is the state that has the least credit because there is alternative justice. For this Justice, the debtor always has the right. ”
Minister Asfor Rocha justifies that the Judiciary has to consider other legal principles when analyzing contracts, and not just the Economy. The clash between the two areas, then, is evident. And in its integration, there is one way out for the country's development.
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