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Historical Supreme Decision Redefines Calculation of Civil Debts in Brazil and Impacts Companies and Creditors Across the Country
A unanimous decision from the Supreme Federal Court (STF) in September 2024 ended a legal impasse that had dragged on for more than a decade. The ministers determined that the Selic rate will be the official index for monetary correction of civil debts, replacing the previous practice that applied 1% monthly interest plus inflation.
This change, therefore, in addition to standardizing calculations, also directly affects companies and citizens, creating a new legal framework for updating values in civil proceedings in Brazil.
Historical Decision After Years of Debate
The debate began in 2013, when there was a compensation process for a traffic accident. The plaintiff, represented by attorney Leonardo Amarante, sought to receive R$ 20 thousand monetary corrected.
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In 2020, the Superior Court of Justice (STJ) decided, by 6 votes to 5, that the correction should follow the Selic rate. However, the plaintiff appealed to the STF, which in 2024 confirmed the understanding unanimously, definitively ending the dispute.
This decision, thus, ended the controversy that had divided courts for years and generated legal uncertainty across the country.
Economic and Legal Impacts of the Decision
Experts highlight that the change will bring significant financial impact, especially for companies that calculated provisions for processes based on the 1% per month plus inflation index.
The tax specialist Luiz Bichara, from Bichara Advogados, stated to Brazil Journal:
“As it was before, litigating in court was the best business in the world because the debt was corrected at a rate higher than the Selic.”
Bichara acted as amicus curiae in the case and represented the National Confederation of Insurance Companies (CNseg). He reinforced that the decision ensures predictability and legal certainty for the business sector, in addition to reducing discrepancies.
Legal Basis and STF Interpretation
Minister André Mendonça, rapporteur of the case at the STF, explained that the STJ had already used interpretations from the Civil Codes of 1916 and 2002, the Code of Civil Procedure, and the National Tax Code (CTN) to support the application of the Selic.
According to him, therefore, diverging from this position would require contradicting the existing legislation. Furthermore, Mendonça recalled that the Supreme has already authorized the use of the Selic on other occasions related to civil debts, reinforcing the consistency of the decision.
Historical Change in Interest Calculation
The CTN of 1967 stipulated that, unless otherwise provided, late payment interest would be fixed at 1% per month.
However, in 1995, Laws nos. 8.981/1995 and nos. 9.065/1995 changed the rule. Since then, the taxes owed to the National Treasury have been corrected by the Selic rate.
According to experts, this legislative change already indicated the need to standardize the calculation for civil debts as well, which has now been consolidated by the STF’s decision.
Practical Effects of the Supreme Decision
- Unification of Correction: The Selic will be used in all processes involving civil debts, ensuring consistency.
- Greater Predictability: Companies find more security when provisioning resources for legal actions, avoiding surprises.
- End of Legal Uncertainty: The impasse that lasted ten years has been resolved, bringing stability.
- Legal Alignment: Brazil gains coherence between tax and civil correction, avoiding discrepancies.
Immediate Consequences for Companies and Citizens
The decision impacts hundreds of ongoing processes, which now need to be recalculated based on the Selic. For companies, this represents lower amounts to pay, reducing financial pressures.
On the other hand, for creditors, especially individuals, the decision may lead to reduction in financial gains in long-term actions. However, legal experts emphasize that the standardization of the index brings stability to the system and reduces unnecessary litigation, benefiting society as a whole.
A Milestone for the Economy and the Judiciary
The STF’s definition in September 2024 became a turning point for the Brazilian legal and business environment. By adopting the Selic as the sole parameter, the Supreme resolved a historical controversy and established a standard of correction aligned with practices already adopted in the tax area since the 1990s.
Experts assert that the measure strengthens economic predictability as it avoids distortions that transformed litigation into an advantage for debtors and a disadvantage for creditors. Moreover, the positioning ensures a fairer and more transparent system.
What Does the Future Hold for Creditors and Debtors?
The impact of the decision will depend on how companies and citizens adapt to the new scenario. For debtors, there is a financial relief with the reduction of the correction rate. For creditors, a challenge arises in dealing with lower amounts in compensations.
Still, the fact is that, with the decision, the STF ensures stability to the Brazilian judicial system, aligning the rules of civil correction with already established tax norms. Furthermore, a greater environment of trust is created for new processes and negotiations.
Do you believe that the STF’s decision strengthens legal certainty and brings balance to the system, or does it represent a loss for those waiting for fairer compensations?
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