Judge in the Oi case defends that Brazil adopts UN standards for recoveries

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The Bankruptcy Law ( Law 11,101/2005 ) ignores the effects in other countries of judicial recoveries of multinational companies located in Brazil. With the deepening of globalization, Brazilian legislation must update the standard to increase the legal certainty of restructuring.


This is the opinion of judge Fernando Viana, from the 7th Business Court of Rio de Janeiro. Responsible for leading Oi's judicial recovery, the largest in the country's history, he stated, at an event in Rio de Janeiro on Monday (7/5), that the Bankruptcy Law is out of date in relation to those of other countries. He also suggested that the country follow the model law of the United Nations International Trade Law Commission (Uncitral) as a basis.

“Although Brazil has a significant participation B2B Lead in international trade and is home to several multinationals, it does not have a law that takes good care of transnational recoveries. The law only deals with national recoveries, ignoring effects in other countries”, he said at the event.

Each country has different criteria for defining competence in recoveries. As Brazil does not have specific rules regarding decisions taken in other nations, they follow the standard procedure: they need to be approved by the Superior Court of Justice. But this procedure, because it is slower, makes cooperation between jurisdictions difficult, said Viana.

There are two proposals in the National Congress to make this procedure more efficient, highlighted the judge: the draft of the new Commercial Code and one that amends the Bankruptcy Law. For Fernando Viana, the path is to adopt the Uncitral model law. This standard does not aim to unify countries' laws, but establishes a unified basis for resolving jurisdictional issues in judicial recoveries.



In the case of Oi, the judge recalled, for the first time North American and European courts are acting together with the 7th Business Court of Rio. As a rule, foreign courts have been considering the Brazilian court as the main one in the case – after all, the The telephone company's headquarters are in Rio de Janeiro. However, there were setbacks. The Dutch court, for example, converted the recoveries of subsidiaries in that country into bankruptcies, contrary to Brazilian orders.