Law 14,905/24, which amends the Civil Code to regulate and standardize the way in which monetary adjustment and interest are applied to civil debts, was enacted. The text was published in the Official Gazette on Monday 1st.
According to the new law, unfulfilled contractual obligations will give rise to an order for damages, plus interest, monetary adjustment and attorney’s fees. Furthermore, in the event that the monetary adjustment index has not been agreed or is not provided for in a specific law, the IPCA (Broad National Consumer Price Index) variation, calculated by the IBGE (Brazilian Institute of Geography and Statistics), or the index that replaces it, will be applied. The same applies to interest rates, when not agreed upon, when agreed without a stipulated rate, or when arising from a legal provision, they shall be set according to the legal rate, which will correspond to the Selic rate, minus the monetary adjustment index.
It is also important to highlight two points of the new Law, namely: a) the methodology for calculating the legal rate and the way it is applied will be defined by the National Monetary Council and published by the Central Bank; and b) if the legal rate shows a negative result, it will be considered equal to 0 (zero) for the purposes of calculating interest in the reference period.
Finally, the new law will come into force within 60 (sixty) days of the date of its publication, with the exception of the item related to the methodology for calculating the legal rate and its form of application defined by the National Monetary Council and published by the Central Bank of Brazil, which have been in force since its publication.
