How are ethics regulated in your country? – What is the character of the respective national rules? Are they mandatory or voluntary?
Professional Ethics in respect of lawyers in Brazil are regulated by the Brazilian Bar (“Ordem dos Advogados do Brasil” – “OAB”). The OAB´s Statute
and The General Regulation of the Statute of Advocacy contain general provisions on lawyers´ ethics. The specific rules on ethics are established by the OAB Code of Ethics and Discipline (“Code of Ethics”), which was adopted and amended by the OAB´s Federal Council in accordance with Law 8906/94 as well as by OAB´s regulations, as enacted from time to time. These rules are of mandatory character and are binding on the professionals enrolled with the OAB.
b) Is there a supervisory authority? How is it organised? What are the rights and legal remedies of a lawyer before this authority? What are the principal rules for proceedings before that authority? Is there international cooperation between this authority and similar foreign entities? Is there governmental supervision either of this authority or of professionals with regard to professional ethics? Effectiveness of these institutions and criticism?
The supervisory authority responsible for ethics matters as regards Brazilian lawyers is the OAB, which is structured as follows
I – The Federal Council;
II – The Sectional Councils;
III – The Sub-sections;
IV – The Lawyers´ Welfare Funds.
The OAB´s supreme body is the Federal Council, which has legal personality and is situated at the Capital of the Republic
, Brasília. The Sectional Councils, which also have legal personality, have jurisdiction over the territories of the Member States, the Federal District and the Territories. 
The Sub-sections are independent parts of the Sectional Councils, in accordance with Law 8906/94 and their constituent charters. 
The Lawyers´ Welfare Funds also have legal personality and are established by the Sectional Councils, whenever the number of professionals enrolled with each Council exceeds 1500 (one thousand and five hundred).
The rights of the lawyer are set out in Chapter II of the OAB´s Statute and, in particular, in Article 7, which provides an extensive list of rights. According to Article 7, the lawyer, amongst others, has the right to:
i. To practice, with freedom, in the whole national territory;
ii. in the name of the right to defence and of professional confidentiality, to have inviolability of his practice, files, database, correspondence and communications, including telephone communications or equivalent duly respected, except when an investigation or arrest is undertaken in compliance with a judicial order and in the presence of an OAB representative;
iii. to examine, in any judiciary, legislative or administration bodies, the records of ongoing or ended proceedings, even without a mandate, when those proceedings are held in camera (“segredo de justiça”), as well as to take notes and photocopies; 
iv. to have access to the records of judicial or administrative proceedings of any nature at the competent department or take the records from the department and keep them for examination for the timeframe determined by law (except when the proceedings are held in camera and when the proceedings records contain documents which would be difficult to be replaced).
A lawyer can appeal to the OAB´s Federal Council from disciplinary decisions passed against him by the Sectional Council.
The Sectional Council of OAB of the place where the disciplinary infraction occurred has exclusive competence to apply disciplinary sanctions to the lawyer and the Tribunal of Ethics and Discipline and are competent to judge the disciplinary proceedings.
The disciplinary sanctions consist of censorship, suspension, exclusion and fine and are applicable to the cases described in Articles 36 to 39 of the Statute of the OAB.
The OAB is part of COADEM (Colegios Y Ordenes de Abogados del Mercosur – the Mercosul Bars Council ), which was established in 1993 for the co-operation and co-ordination of the legal professional activities amongst Mercosul countries
(Argentina, Brazil, Paraguay and Uruguay).
The OAB is a public service entity with legal personality and is not hierarchically or functionally linked to any Public Administration bodies.
Thus, the OAB is independent and is not supervised by the Government, as nor are its members.
OAB is very active in Brazil in the defence of citizens´ rights and supervision of the legal profession. The institution has always played a vital role in these areas.
c) Is a lawyer allowed to use information stemming from another case he has been retained for? In the negative, is it sufficient to establish “Chinese walls”?
The lawyer is not allowed to use confidential information stemming from another case he has been retained for, unless authorised by his client.
The lawyer acting against a former client or a former employer on behalf of third parties shall observe professional confidentiality and safeguard the confidential and privileged information disclosed to him
. In addition, a lawyer must keep secret whatever he knows by virtue of his profession, even when cross-examined. In that instance, the lawyer is expected to refuse to be cross-examined as a witness in proceedings in which he has represented or will represent a client or about facts involving a former client, even if authorised or required to do so by the constituent person.
In regard to matters dealt with within the same firm, it is not possible to establish “Chinese walls”. Although there are no specific regulations applying to mergers and acquisitions in this regard, the rule, as contained in the Code of Ethics, is that lawyers belonging to the same law firm cannot represent clients with opposed interests in court (sic)
. This rule is understood to apply outside the scope of litigious matters as well.
Finally, if a conflict arises between different clients of the lawyer, and they cannot come to an agreement on the controversy, then the lawyer must opt to keep only one of the parties as his client. He must resign in relation to the other client, thereafter observing, at all times, his professional duty of secrecy.
d) What are the consequences of a breach of the rules of ethics? Is there any civil liability (e g, for damages) to the client in the case of such a breach? Does the breach constitute a criminal offence or an offence under administrative law? What are the criminal and administrative sanctions?
If a lawyer is in breach of the rules of ethics applicable to the profession, he may incur in one of the types of disciplinary sanctions imposed by the OAB, i.e., censorship, suspension, exclusion and penalty
. The lawyer who has been suspended or excluded is prevented from exercising in the profession. Furthermore, criminal and civil sanctions shall also be applicable, along with disciplinary proceedings.
A partner of a law firm has subsidiary and unlimited liability for losses caused (by himself and/or another partner) to the client by an act or omission in the exercise of the legal profession
In the civil sphere, the remedy available to the client who has suffered the loss as a result of the lawyer´s malpractice is damages.
In the criminal sphere, the Brazilian Penal Code states, when dealing with crimes against secrecy inviolability, that whomever divulges, with no just cause, contents of a private document and damage to a third party arises from such disclosure, will be liable to prison with a penalty which may vary from one to six months, or to a pecuniary penalty.
Also, the Penal Code determines that whomever incurs the crime of violation of professional secrecy may be sentenced to prison for a period of between three months to one year, or be liable to a pecuniary penalty.
e) Is the lawyer allowed to represent or advise the company or a shareholder while he is a member of the board of the company? May he disclose to his client information he gained as a result of such function?
The lawyer who is also a member of the board of the company is not prevented from representing or advising it or a shareholder, but it is advisable that the circumstances and conditions of such representation be fully disclosed to the other members of the board and/or to the remaining shareholders.
On the other hand, as the member of the board has the primary duties of loyalty to the company and secrecy towards the company´s affairs, the lawyer in that position must refrain from using the information acquired to the benefit of his client, even if the client is a shareholder of the company, as the company´s social interest prevails over that of the shareholder, pursuant to Law 6404, of 15 December 1976 (the Brazilian “Companies Law”).
Moreover, for obvious reasons, the lawyer must refrain from simultaneously being a member of the board of a company and representing or advising a client in a conflict of interests with such company.
f) Do the professional rules subject the lawyer to a higher degree of care and sincerity in respect of the information provided by the client and passed on to the other party?
Yes. Professional rules emphasise the need of the lawyer to observe secrecy and confidentiality, with few exceptions (serious threat to life, honour, and other instances specified by law). The client´s prior and written authorisation to the disclosure by the lawyer of relevant information to the client´s interests is always an ethical attitude and relationship wise.
g) Is it customary in your country for a business lawyer to act as an intermediary for a transaction? In the affirmative: Is he free to ask for a commission to be paid?
No. The lawyer must refrain from promoting interests linked to activities that are not related to the legal profession. Moreover, the Code of Ethics
determines that the exercise of the legal profession is incompatible with any mercantile activities. Finally, the lawyer is prevented from offering professional services that, directly or indirectly, imply in obtaining clients
h) Are you aware of ethical problems specifically linked to an international M&A Transaction? Is the CCBE Code known/applied in case of (European) transnational ethical difficulties?
It is common, in a M&A transaction, when the Purchaser is domiciled outside Brazil, that the Brazilian lawyer be asked to undertake “limited due diligence exercises”. In those circumstances, it would be a failure of his professional duty of care, for the Brazilian lawyer not to insist that his client have a full due diligence exercise completed. The problem arises if the client fails to accept this necessity.
Proper due diligence exercises are absolutely essential on Brazilian target companies, so that hidden liabilities, that may prove to be very costly to a Purchaser, can be avoided. Thus, even if the overall value of the present transaction is much higher than the value allocated to the Brazilian company, there are some overriding Brazilian provisions, especially of a tax and labour nature, that may cause a Purchaser to be liable well after the Sale and Purchase Agreement is executed, regardless of the value which is allocated to the Brazilian company. Moreover, although the Purchaser may be entitled to eventually recover his loss from the Seller, litigation can be very costly and lengthy in Brazil.
The CCBE Code does not apply to Brazilian lawyers.1. Initial Stage: Professional Ethics in the Context of the Appointment of the Lawyer
a) What do the professional rules of your country provide in respect of the lawyer´s obligation to be truthful about his firm´s characteristics, capacity and qualifications in the context with statements during a “beauty parade”?
OAB´s Administrative Rule 94, of 5 September 2000, permits that the so-called “informative publicity” be done by lawyers, provided that the information released is objective and truthful in relation to the services that he proposes to render,
under all circumstances.
b) Is a lawyer allowed to represent, at the same time, several bidders or their representatives (e g, investment banks)? – Is there a conflict of interest from the viewpoint of the professional rules in your country?
A lawyer may represent more than one client, so long as each or any client is not being represented by another lawyer
and provided that there are no conflicts of interest amongst the parties. In this regard, Article 17 of the Code of Ethics states that partners in a law firm may not represent clients with opposing interests in court.
Although the rule specifically refers to representation in court, the provision is understood to apply to non-contentious advocacy as well.
The answer to this question therefore is that almost inevitably there would be a conflict of interest in a situation as above described and the lawyer, therefore, would be prevented from acting.
c) What are the rules with regard to lawyer´s fees (contingency fees; rebate on a tariff)? Can the lawyer fix his remuneration according to the total volume of the transaction? Do there exist other problems when determining legal fees in M&A Transactions?
In general terms, contingency fees agreements are permitted and shall always be in funds. Fees paid in assets belonging to the client shall only be permitted exceptionally, and provided that the respective agreement contains a clause in this regard. In M&A transactions fees are charged on an hourly basis and do not refer to the value of the transaction.
d) Is the lawyer allowed to take “indirect” mandates, e.g. acting as the counsel of the investment bank or the tax adviser of the Vendor/Purchaser?
Yes. Nothing prevents a lawyer from taking indirect mandates, provided that the rules mentioned in 1 b above are duly respected.
2. Professional Ethics at the Stage of the MoU, LOI
a. If a lawyer of your country is allowed to become active in a transaction for both the Vendor and the Purchaser, are there specific obligations he must adhere to (e g; warning both sides of negative consequences of a contractual clause, obligation to draft a “fair” agreement, conflict of interest)?
It would not be ethical for a lawyer to represent clients with opposing interests (see answer to question 1 b above).
b. Do the national rules provide for specific obligations of the lawyer in the case of a public offer? Is the lawyer a person that can validly examine the Prospectus? Is it common that a lawyer would do that?
There are no specific obligations of a lawyer in the case of a public offer.
The role of the lawyer is to examine the Prospectus on behalf of his client in order to verify that all the information required by law is stated therein.
The primary responsibility for the truthfulness, completeness and quality of the information contained in the Prospectus rests on the public company´s administrators.
The prospectus shall contain all relevant data regarding the company and shall contain its administration reports and financial statements prepared by its financial auditors, who must be duly registered with the Brazilian Securities Commission (Comissão de Valores Mobiliários – “CVM”).
c. Is there any obligation on the lawyer´s side if his client takes undue advantage of information or attempts stock exchange manipulations (protection of investors´ interests)?
Yes. Although the lawyer would be prevented, due to his professional duty of secrecy, from disclosing the information to third parties, the lawyer would have the obligation to advise his client on the consequences of the client´s act pursuant to the prevailing insider trading provisions in Brazil (see answer to question b in item 13). Should his client neglect the lawyer´s advice, and the act be manifestly against the law, the lawyer should discontinue the client´s representation or otherwise he would be considered to have committed a disciplinary infraction .
3. Professional Ethics in connection with a Confidentiality Agreement
a. What do the national rules provide for with respect to the duty of confidentiality? Are there specific professional obligations of the lawyer to disclose information to public authorities, to auditors, to shareholders or to other classified persons?
As regards confidentiality, the relevant national rules, the Code of Ethics, provides the following:
” Art. 25. Professional secrecy is inherent to the profession and, as such, should be observed, except in case of great threat to the right to life, honour, or when the lawyer is challenged by the client and, in his own defence must reveal a secret, but always restricted to the interest of the case.
Art.26. The lawyer must keep secret whatever he knows by virtue of his profession, even when cross-examined. In such a case, the lawyer is expected to refuse to be cross-examined as a witness in proceedings in which he has participated or shall participate or about related fact involving a former client, even if authorised or required to do so by the constituent person.
Art. 27. The secrets disclosed by the lawyer to the client may be used within the limits of the defence, provided he is authorised to do so by the constituent.
Sole Paragraph. The written communications between the lawyer and the client are presumed confidential and cannot be revealed to third parties.”
The lawyer will disclose information as necessary in the course of a transaction and in the interests of his client. There are no specific rules pertaining to lawyers in relation to disclosure of information to public authorities, auditors, shareholders or others. Those duties are of the company.
b. Can the lawyer refuse to give evidence, before the court and public authorities (e g, fiscal agencies or disciplinary authorities)?
The lawyer can refuse to give evidence before the court, in accordance to Articles 25 to 27 of the Code of Ethics, quoted in question 3 a above.
c. What role do the national provisions on data protection play in that context (in particular data on employees of the target company)?
The Code of Ethics emphasises the lawyer´s duty of confidentiality, as seen in question b (ii) above. The misuse of confidential information by a lawyer, causing the client to suffer a loss, might have ethical, civil and criminal consequences (see answers to question A d above).
d. Does a lawyer of your country have special professional obligations, e g, duty of secrecy or, to the contrary, of disclosure in the context of merger control authorities (national, international), the stock exchange or similar institutions?
Lawyers have a duty of secrecy and the right to maintain the same.
The duty to inform mergers authorities rests upon the parties to the transaction as well as, in the case of acquisitions of listed companies, on the CVM.
e. Which sanctions are usually provided for in the Confidentiality Agreement (e g, a penalty)?
Damages for losses arising out of misuse of confidential information and failure to return information supplied; reimbursement of professional fees (lawyers and accountants); etc.
f. Is there any case on which the lawyer will be released of his duty of confidentiality?
Yes, as seen in 3 a above (Articles 25 and 27 of the Code of Ethics – great threat to the right of life, honour, etc.).
4. Preparation of the Data Room on behalf of the Vendor and “Seller´s Due Diligence”
a. Are there explicit professional standards (for lawyers and for other professional advisors) for a data room in your country?
There are no specific professional rules applying to Data Rooms in Brazil.
b) How would a lawyer in your country allocate, among the management of the target and the other advisors typically involved, the responsibility to provide correct and complete information in the data room? Would the lawyer issue a “certificate of completeness” to either his own client (the Vendor) or to the Purchaser´s side, and on what kind of information?
The lawyer responsible for organising the Data Room on behalf of the Vendor must exercise his duty of care. To this objective, it is advisable that the lawyer collects representations to the various managers, officers and advisors involved regarding the completeness and accuracy of the information on the target that each of them brought to the data room
The lawyer of the Vendor is more likely to co-ordinate responses to the due diligence questionnaire submitted by the lawyer of the Purchaser rather than to generate them.
The basic information relating to the due diligence will be generated by the relevant departments within the Vendor´s organisation, such as accounts departments and human resources departments.
Once the basic information is received, certificates, as necessary, will be asked for by the lawyer of the Purchaser from the relevant authorities (for example, from the Land Registries, as related to the properties belonging to the target; or from the competent commercial registry, in connection with the corporate status of the target) so as to prepare his due diligence report, to which copies of relevant documents are attached.
It is not common to issue “certificates of completeness”.
5. The Lawyer´s Role if restrictions on Disclosure apply in a Due Diligence
a. Is it customary in your country that in such a situation the parties (on Vendor´s and/or on Purchaser´s side) would choose a lawyer to examine the Data Room information in detail and come up with a summary only? Will the lawyer´s duty of confidentiality be specifically addressed? Is there an increased risk of professional liability of the lawyer?
It is not common for lawyers to analyse documents in a Data Room and come up with a summary only of the information contained therein. However, whenever a Data Room takes place, it is customary that the lawyer who examines the information comes up with a summary only, without the possibility of obtaining copies of the documents.
Lawyers for the Purchaser should prepare due diligence reports which are very comprehensive, based on documents provided by the Vendor and obtained from various public authorities ( see answer to question 4 b above).
From the Vendor´s lawyer´s perspective, it will be necessary to ensure that there is no breach of confidentiality or completeness of the documents presented.
Due diligence exercises are very important in Brazil in view of hidden contingent liabilities of Brazilian companies. There is a risk of increased liability on the part of the Purchaser´s lawyer if he fails to advise his client on the necessity of effecting a complete exercise or if he fails to endeavour to obtain the relevant information regarding such exercise. Areas to raise concern in this regard are tax, employment matters and environment.
b. Are you aware of any specific standards or formats of such a summary produced by the lawyer?
There is not a specific format as the volume and nature of the information made available to the lawyer may vary a lot.
In our firm, we use a standard questionnaire which is very comprehensive.
c. Would the lawyer, in such a situation, be admitted to collecting additional information from the management, the (senior) staff or the general legal counsel?
The lawyer can collect information from the target company´s management, staff, legal counsel or even shareholders, provided that he has the express consent of his client and the other party´s counsel. Should the lawyer understand that the information received is not sufficient, he must inform the client of this circumstance and warn him on the consequences of the absence of the required additional information.
6. The Lawyer´s Role during Negotiations towards the Purchase Agreement
a. Dual representation and professional ethics: May a lawyer draw up a contract on behalf of both sides? What are the professional rules in your country for protecting the client´s interests and those of his contractual partner (e g, equal treatment, protection of the partner not represented by a separate lawyer)?
A lawyer would only be ethically entitled to draw up a contract on behalf of the Vendor and the Purchaser so long as there are no conflicts of interests, which is an almost impossible situation. If, at any time, a conflict occurs, the lawyer must opt for representing only one of them. In that case, the lawyer must keep confidential any privileged information he became aware of by virtue of his previous representation of his former client.
b. Are there any professional rules or standards governing the way the transaction documents are drafted? Is the lawyer restricted in using, for the benefit of his client, information he obtained during the due diligence examination when drafting the sales agreement (in particular, with respect to the representations and warranties in the light of the information disclosed in the due diligence)? – What are the consequences if he does not comply with these standards?
There are no professional rules governing the way the transaction documents are drafted. However, according to general rules in the Code of Ethics, the lawyer must meet appropriate standards of professional competence in so doing. The lawyer is not restricted from using information obtained during due diligence process when drafting the sale and purchase agreement for the benefit of his client. Information obtained during the due diligence examination must however be kept confidential in relation to third parties, pursuant to professional secrecy rules, as above seen.
c. How do lawyers stand out and distinguish themselves from other counsels and consultants in the context with structuring “the deal”? Does the reference to professional ethics play a role in that context?
Through experience; understanding the client and his needs; understanding the market place; etc.
Reference to professional ethics play an important role in the structure of the deal as it imposes on the parties awareness of the importance of keeping up moral individual, social and professional principles.
7. Information to the Board of the Target Company
a. Under the professional rules in your country, are there any requirements or restrictions for the lawyer who represents either the Vendor (shareholder at present) or the Purchaser (shareholder to be) to inform the management board of the target company about the transaction and details thereof? At which stage of the transaction do such requirements or restrictions apply?
There are no requirements, but restrictions do apply. The management board of the target may only be informed (or otherwise consulted or contacted) pursuant to the Vendor´s lawyer consent. 
b. Are there duties to be met by lawyers to inform shareholders (e.g., in the annual shareholders´ meeting)?
Lawyers have a primary duty to inform their clients. If, pursuant to their client´s representation, lawyers participate in shareholder´s meetings and their professional assistance is required, lawyers must collaborate and render any information required.
a. Are there special professional obligations of the lawyer at and after the closing of the transaction (e g, notifications to authorities, keeping the file for a certain period of time)?
In that instance, there are no professional obligations on the lawyer, but on the parties. Thus, after the operation takes place, the Administrative Council of Economic Defence (Conselho Administrativo de Defesa Econômica – CADE) must be informed, by the parties and the Brazilian Securities Commission (Comissão de Valores Mobiliários – “CVM”) on the changes of control in listed companies in order to examine the same, if necessary
, for anti-trust considerations. The lawyer´s role will therefore be to advise his client, organise and conduct the said proceedings before CADE, until its final decision.
b. Is it admissible in your country for the lawyer to be included in a “Tombstone” (e g, as “the Legal Counsel to Purchaser”)?
There is some discussion as to whether the lawyer´s name may be included in a “Tombstone”, as the Code of Ethics does not allow the lawyer to “make use of the usual marketing tools of the mercantile activities”.
Therefore, the discussion begins as to whether a “Tombstone” is a marketing tool linked to mercantile activities. Questionable as the matter may be, it is not usual in Brazil to find lawyers´ names included in “Tombstones”.
9. Lawyers as Escrow Agents
a) Are there specific obligations of the lawyer when acting as an escrow agent (trustee)?
Escrow agreements, as used in Anglo-Saxon systems, are not foreseen by Brazilian legislation and therefore lawyers do not act as trustees.
b) Are there specific rules in your country regarding the escrow account held by a lawyer?
No (please see above).
c) How would the lawyer calculate the fees for that kind of service?
N.A. (please see above)
10. Post-acquisition Investigation; Warranty Claims
a. Are there legal provisions that specifically protect the lawyer in your country when he is called as a witness in a transaction he was involved in (professional duty to secrecy, the right to refuse to give evidence)?
Yes. The lawyer may refuse to testify as a witness in proceedings referring to a fact relating to a person (individual or legal) whom he has previously acted for or presently represents, even if authorised by such person, as well as to speak about any fact that constitute professional secrecy. 
b. What do the professional rules of your country provide for a lawyer who acted as counsel for Vendor or Purchaser during the acquisition and who is later retained as counsel for one of the parties in a dispute arising out of the agreement (e.g., proceedings dealing with payment claims, warranty claims or the like)?
The Code of Ethics says that the lawyer must refrain from acting in a case which is contrary to the validity of an act (or contract) of which he has previous professional knowledge.
In that case, the lawyer must declare himself prevented from acting on ethical grounds.
Although the rule mentioned above does not refer to the case where the validity of the act is not questioned, we understand that, on ethical grounds, the lawyer should refrain from acting on behalf of the other party, in the circumstances described above.
Finally, even if, for the sake of arguing, one understood that the lawyer would not be prevented from acting, it is our belief that the former client´s consent would be necessary and therefore this would be a very unlikely situation to arise.
c. Can lawyers act as arbitrators or mediators on payment claims, warranty claims or the like if they were previously the counsel of the Vendor/Purchaser during the acquisition?
Arbitration in Brazil is regulated by Law 9307, of 23 September 1996.
Accordingly, people who have, with one of the parties, a relation that characterises any of the cases of impediment or suspension applying to Brazilian judges, as described in the Brazilian Civil Procedure Code, cannot act as arbitrators.
A case of impediment occurs where the judge has intervened in the proceedings as an attorney-in-fact for the party, pursuant to an instrument of mandate.
Although, in the case under analysis, the instrument of mandate given by the party (Vendor or Purchaser) to the lawyer would be in the context of a transaction, and not of legal proceedings before a court of law, we understand that the above described situation would constitute a conflict of interest, pursuant to a wider interpretation of the above mentioned rules, and the lawyer should therefore refrain from acting as an arbitrator.
Mediation is very rarely used in Brazil.
11. The Lawyer as the Counsel of Target
a. Is there any professional restriction preventing the lawyer of the Purchaser to become the legal counsel of the target company, at a later stage?
It is possible and actually common for the lawyer of the Purchaser to become the legal counsel of the target company, after the transaction takes place. However, should a conflict of interest arise between the Purchaser and the target company, the lawyer must opt between the representation of one or the other.
b. May the lawyer use knowledge acquired during due diligence for future professional work for the target company?
12. Insurance; Liability Cap
a. Is it mandatory/possible/customary for the lawyer in a M&A Transaction to take out special insurance coverage?
It is not mandatory for a lawyer in a M& A transaction to take out special insurance coverage. It is customary for lawyers to take insurance in general and the policy will refer to a maximum cap applying to each case.
b. Would the lawyer inform the client of the existence of such special coverage?
This would be unusual, although the client would be informed upon request of the firm´s policy and the coverage applying to each particular case/claim. This information, however, is not, for example, usually mentioned in an engagement letter.
c. Is it possible/customary for the lawyer to agree with the Vendor/Purchaser on a liability cap? What would the cap consist in (amount; degree of negligence; etc)?
It is possible, but not customary. The cap is usually related to an amount of the reparation for damages caused to the client.
13. Other Aspects
a. In the light of provisions in your country against money laundering, fiscal fraud and similar offences: is there any responsibility, liability or duty of diligence of the lawyer of either the Vendor or the Purchaser when transferring funds, in particular, the purchase price, to a party of the M&A Transaction or a third party, e.g., to a bank account situated in a “fiscal paradise”, etc?
As mentioned under item 9 above, lawyers do not act as escrow agents in Brazil. OAB´s statutes in force do not contain provisions relating to clients´ accounts.
Law 9613, of 3 March 1998 regulates money laundering crimes. The law was created to combat crimes related to money laundering and to detect and punish all and any attempts to legalise the assets generated by such crimes. The groups subject to the law are those companies or other legal entities whose main or secondary activity is the acquisition, intermediation or administration of financial resources of third parties in Brazilian currency and related activities. Included under the legislation are insurance companies and brokers, banks, stock exchanges and futures markets; users of magnetic cards, or their equivalent, which permit the transfer of funds; companies that deal with foreign exchange, leasing, and factoring; individuals or companies dealing in commercial jewels, gemstones and precious metals, objects of art and antiques.
All these groups are required to identify their clients, maintaining an up-to-date client list and, for a minimum of five years, maintain records of all transactions in Brazilian or foreign currency as well as documents of all operations having a value which exceeds a level as determined by a qualified authority.
Lawyers are not affected by these rules.
When the lawyer becomes aware of his client´s intentions he must inform the client unequivocally on the consequences arising therefrom
and refuse to carry on with or to take the case.
Moreover, it is fair to say that pursuant to the new regulations on money laundering, lawyers (as well as other people rendering services that receive money from clients on account or for payment of third parties) will more and more keep separate accounts from their own, in order to guarantee that sums belonging to different parties will not be mixed up.
Brazil has specific legislation defining tax havens as countries that do not tax income or tax income at a maximum rate less than 20% and the lawyer must make sure that the client is aware of the same. (Whilst such legislation does not impact directly on mergers and acquisitions operations, Brazilian transfer pricing legislation extends to all operations with tax haven countries.)
The lawyer´s duty of due diligence will always apply, pursuant to general rules. Accordingly, he must refrain from acting in cases which are against the law and from receiving from his client any amounts for illicit application. 
b. Does your country have rules against insider trading? Do they provide for specific professional obligations of a lawyer? Which obligations?
Brazil has rules on insider trading and they are contained in the Brazilian Companies Law, in Law 6385, of 7 December 1976 (the “Securities Law”) as well as in regulations issued by the Securities Commission.
In this regard, two duties and a prohibition are imposed on the public company´s administrators (comprised of the directors and the administrative council)
(i) the duty to keep secret any information that has not been divulged to the market, which is capable of influencing in a considerable way the value of the company´s securities.
(ii) the prohibition to use such information in order to obtain, to himself or to a third party, any advantage through the purchase or sale of securities; and
(iii) the duty to ensure that his subordinates and third parties within his trust will keep secrecy and will not use such information in order to obtain advantage, for them or others, through the purchase or sale of securities.
An infraction of the above rules will subject the defaulting party to damages and lost profits, to which one should add court fees and legal costs.
Pursuant to the above provisions, the responsibility for insider trading infractions lies on the company´s administrator, even if it is perpetrated by third parties “in whom he trusts”, which may include his lawyer.
There are no rules specifically applying to “lawyers” in the Brazilian legislation relating to insider trading. However, should a situation in this regard arise, and should the administrator be held liable in an insider trading case, then, pursuant to Article 1524 of the Brazilian Civil Code, he would have the right to sue the third party causing the loss for redress.
c. Do there exist specific ethical or other restrictions for the lawyer in your country when co-operating, in the context with M&A Transactions, with financial advisers, non-lawyer professional advisers or in-house lawyers?
There are no specific ethical restrictions to lawyers, in Brazil, when co-operating with financial advisers, non-lawyer professional advisers or in-house lawyers, in the context of a M&A transaction.
Existing restrictions are those which apply to the lawyer´s activities in general (and not only in the context of an M&A transaction), as explained above.
d. Please briefly describe other aspects of professional ethics in the context with M&Transactions which have not been addressed in this Questionnaire.
No further comments.
Graduada pela Faculdade de Direito da Universidade de São Paulo (USP) em 1993. Cursou Pós-Graduação na University College London, Universidade de Londres de 1985 a 1986.