The proposed reform of Brazil’s Civil Code aims to update the country’s legal framework to reflect the technological and social advancements of recent decades. Bill No. 04/2025 seeks to modernize key legal institutions, enhance legal certainty, facilitate business activities, and strengthen protections for citizens. Drafted by a committee of legal experts appointed by the Senate, the bill introduces significant changes across various areas of Civil Law.
Key Proposed Changes
General Rules:
1. Standardization of Statute of Limitations
Currently, the Civil Code establishes varying time limits depending on the type of claim. The reform proposes standardizing the statute of limitations to five years, covering both contractual and non-contractual liability.
2. Debt and Limitations Period
• Reduction of the general limitations period from 10 years to 5 years.
• Adjustment of debt interests: Civil debts without a stipulated interest rate will accrue 1% monthly interest, diverging from the recently enacted Law 14,905/2024, which adopts SELIC minus IPCA.
3. Compensation for Moral Damages
The bill introduces objective criteria for determining compensation for moral damages, considering the impact on the victim’s life and the possibility of reversing the damage. In cases involving intent or repeat offenses, damages may be set up to four times the base amount.
Contract Law:
1. Contract Law Revisions
The reform distinguishes between negotiated contracts and standard form contracts, ensuring greater balance in contractual relationships and introducing specific guidelines for the digital era.
2. Revision of Hardship Doctrine (Theory of Unforeseen Circumstances)Article 317 has been revised to consolidate the principles of alteration of the contractual basis and excessive burden. Judges may now intervene when unforeseeable events significantly affect the obligation, harming either party.
3. Digital Contracts and Smart Contracts
The modernization includes concepts from the digital environment, such as smart contracts, digital intermediaries, and technological security, aligning Brazilian law with global standards. New rules for civil liability in electronic transactions are also proposed.
Property Law:
1. Property Rights and Real Estate Use
The reform modernizes the concept of the social function of property and addresses contemporary issues, such as short-term rentals via digital platforms, restricting ultra-short stays without explicit approval from condominium associations.
2. Expansion of Unseizable Assets
The proposal enhances protections for individuals, families, and small family businesses by shielding minimum essential assets from debt collection, except in child support cases. It also prevents seizure of a family’s only home, though in cases of luxury properties, up to 50% of the value may be subject to collection.
3. Adverse Possession (Usucapião)
• Administrative Process: Property holders may now request adverse possession directly at a notary office, eliminating the need for court action.
• Rural Adverse Possession: To combat land grabbing, ownership via adverse possession can only be claimed once per person.
• Urban Adverse Possession: Occupants of up to 250m² urban homes for five uninterrupted years without opposition may claim ownership.
• Family Adverse Possession: A spouse or partner who remains in a shared urban home (up to 250m²) after the other leaves for two uninterrupted years will gain full ownership.
Business Law:
1. Business Law Revisions
The reform introduces specific principles for Business Law, reduces corporate formalities, encourages arbitration, and simplifies company dissolution, cutting bureaucracy. It also increases legal certainty for startups and foreign investments, requiring foreign companies to maintain a physical presence and representative in Brazil to operate domestically.
2. Digital Law
• Foundations of Digital Law: Establishes rights and protections for individuals in the virtual environment.
• Removal of Sensitive Content: Ensures removal of links in search engines to intimate images, deepfakes, and content involving minors. Individuals can request content removal directly from hosting websites and ask for delisting from search engines in specific cases. However, experts warn these measures may conflict with Supreme Court rulings.
• Platform Liability: Digital platforms will be civilly liable for data breaches and must implement age verification mechanisms. The bill also repeals Article 19 of the Internet Bill of Rights, which currently exempts platforms from liability for third-party content unless ignoring a court order — an issue under review by the Supreme Court.
• Digital Assets: Defines digital assets as including social media accounts, passwords, cryptocurrencies, gaming accounts, photos, videos, texts, and airline miles, allowing these to be inherited or designated in wills. Heirs may request deletion or memorialization of deceased persons’ accounts.
• Digital Identity and Signatures: Regulates electronic signatures and officially recognizes digital identity as a form of citizen identification.
• Artificial Intelligence (AI): Requires clear identification when AI is used and explicit consent for generating images of real or deceased individuals via AI.
Family Law:
1. Family Law Reforms
The reform brings new rules on pet custody and shared responsibilities after separation. It also expands private autonomy in prenuptial agreements, allowing clauses on infidelity and automatic changes to property regimes.
Spouses are removed from the list of compulsory heirs, and unilateral divorce at a notary office is allowed.
Additionally, the reform includes valuation of business shares acquired before marriage in the division of assets, overruling the current Superior Court of Justice (STJ) position.
2. Recognition of Socio-Affective Ties
The reform proposes the legal recognition of socio-affective relationships, enabling the formalization of bonds between stepchildren and stepparents, though affection between humans and animals remains legally distinct.
3. Changes to Family and Property Structures
The bill acknowledges a shift toward more individualized property relations, seeking to balance modern family dynamics with legal certainty.
Conclusion
The Civil Code reform seeks to modernize Brazilian legislation to reflect today’s social and technological realities while maintaining legal stability. The proposed changes will have a direct impact on various sectors, from contract and business relations to family and property law, making the legal system more efficient and aligned with contemporary society.