Aperto de mãos fechando negócio

Municipality of São Paulo enacts Law to foster out of court resolution of disputes


On March 9th, 2020, the Municipality of São Paulo enacted Law no. 17,324/20, to foster out of court resolution of disputes, aiming a better control and reduction of the Municipality’s legal demands.

With regard to existing debts, of tax nature or not, the new Law authorizes the Municipality to proceed with transactions involving debts in which value does not exceeds BRL 510,000.00, which may be carried out individually or collectively, through the publication of notices with the special payment conditions.

The transaction proposal between the parties may provide for the suspension of the debt collection proceeding and, after approval in court, will suspend the enforceability of the debt, which will no longer be an impediment to the renewal of the tax clearance certificate.

In addition, Municipal Law no. 17,324/20 grants the Public Administration the rights to insert mediation clauses in administrative contracts, as well as adopt arbitration for the resolution of disputes concerning disposable rights.

Also as a way to reduce litigation and costs related to judicial proceedings, the above-mentioned Law authorizes the creation of conciliation campaigns and institute the possibility of closure, or not filing, of legal demands that have reduced chance of success by the Municipality.

In this context, to better control the above measures, Law no. 17,324/20 authorized the creation, by a specific decree, of the Chamber of Conflict Prevention and Administrative Resolution, agency linked to the Attorney General’s Office of the Municipality of São Paulo.

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