The General Meeting of Creditors (AGC) is the highest collective decision-making body within the judicial reorganization process. Provided for in articles 35 to 46 of Law No. 11.101/2005 (Judicial Reorganization and Bankruptcy Law), it brings together qualified creditors to discuss and decide on fundamental issues related to the fate of the debtor company.

In simple terms: it is the General Creditors' Meeting (AGC) that decides whether the judicial reorganization plan will be approved, modified, or rejected. Without its approval, there is no judicial reorganization.

It is important to highlight that the General Creditors' Meeting (AGC) is not a passive hearing. It is an environment of negotiation, power, and strategy, in which creditors of different natures often need to build consensus about the future of the company in crisis.

The Four Classes of Creditors

Brazilian law organizes creditors into four distinct classes. Class I includes labor creditors and those affected by workplace accidents, who have greater legal protection. Class II encompasses creditors with real guarantees, such as financial institutions holding collateral on the debtor's assets. Class III includes unsecured creditors, that is, suppliers and service providers without specific guarantees. Class IV is for micro and small business creditors.

Installation Requirements and Voting Quorums

The establishment of the General Creditors' Meeting (AGC) is subject to specific requirements. For the first meeting, the presence of creditors holding more than half of the credits in each class is required. For the second meeting, the meeting may be held with any quorum, provided that a minimum interval of five days is observed between the meetings.

In general, voting is proportional to the value of the credit. Ordinary matters follow the simple majority criterion of the credits present. However, the approval of the Judicial Reorganization Plan requires qualified quorums and voting segmented by classes, reflecting the complexity and diversity of the interests involved.

Case Law and Procedural Efficiency

Case law has established a relevant understanding that pending objections, qualifications, or rectifications of credit do not have the power to invalidate resolutions duly approved in a General Creditors' Meeting, nor do they authorize their suspension or postponement. This is a legislative choice aimed at preserving the speed and legal certainty of the recovery process.

Another important point is that the claims of abstaining creditors are disregarded for the purposes of calculating the deliberative quorum, thus preserving the participatory logic of the assembly.

The General Meeting of Creditors (GMC) has established itself as a true instrument for corporate crisis governance. Acting efficiently in this environment requires more than just technical mastery of the Brazilian Bankruptcy and Reorganization Law (LFRE): it demands strategic vision, negotiation skills, and an understanding of the economic impacts involved.

In a landscape of increasingly sophisticated restructurings, understanding the dynamics of the General Creditors' Meeting (AGC) is to understand the very game of judicial reorganization.

Article written by: Vitor Ferrari and Samar Majzoub.