Keeping the business finances healthy has its challenges, especially when it is necessary to consider external factors, such as the country's economic condition. And to resolve the situation with creditors, an alternative to lengthy and bureaucratic processes can be theextrajudicial recoverydirect negotiation procedure between the company and the creditor.
According to the report of theBrazilian Observatory of Extrajudicial Recovery (OBRE), from the consultancyBiolchi Business, from 2021 to date (July 2024), have been identified100 cases of extrajudicial recovery in Brazil, and 157 since the validity of Law 11.101/2005, whose text was changed byLaw 14.112/2020, in effect from 2021. A recent example was the extrajudicial recovery of theBahia Houses, which in 2024 restructured a debt of R$4.1 billion that had as creditors theBradescoand theBank of Brazil.
Extrajudicial recovery, unlike judicial recovery, does not involve direct intervention by the judiciary. Through a mediator, who can be the lawyer responsible for drafting the document, both parties (the business owner and one or more creditors) need to reach an agreement for the payment of the debt. The duration of the process is usually much shorter than a judicial recovery. It is as explained by thecorporate lawyer Cristina Wadner, from the officeCristina Wadner Associate Lawyers:
“It is a much faster and less complex alternative, because in the case of judicial recovery, the process is submitted to a judge, who will supervise the debt payment plan, in addition to appointing an administrator. And assuming there are twenty creditors involved, they all have a deadline to speak in the case. Therefore, in some cases, extrajudicial recovery can be a more beneficial solution for the business”, explains the lawyer.
These cases, explainsWadnerinvolve companies with more specific and less complex debts. Among the criteria for companies that meet the tax requirements are:
- You must have been engaged in business activity for more than two years;
- Not having a pending request for judicial recovery and not having a request for judicial recovery for two years;
- Must not have declared bankruptcy;
- Not having been convicted or having as an administrator or controlling partner a person convicted of fraud crimes (fraudulent acts).
Already according to theLaw 11.101/2005, public companies and mixed economy companies; public or private financial institutions; credit unions; consortiums, supplementary pension entities; companies operating health assistance plans; insurance companies; capitalization companies and other similar entities cannot open an extrajudicial recovery process.
“There are also credits that cannot be subject to extrajudicial recovery, such as labor credits, those arising from work accidents, tax credits, credits arising from commercial leasing, credits from purchase and sale or promise of real estate with an irrevocability clause and exchange contracts. These are the credits that are excluded. If the criteria are met, the company can file for extrajudicial recovery,” he recalls.Cristina Wadner.
