By: Vitor Ferrari and Ivan Kubala

With the changes brought by Law 14.112/20, which changed and inserted provisions into Law 11.101/05, judicial recovery for the rural producer, as a businessman, has become possible. The measure is of utmost importance for the national economy, since the agricultural sector has a large share in the country's Gross Domestic Product (GDP), in addition to generating a large number of jobs, whether directly or indirectly, making the bankruptcy of companies in this area a concern.

Basically, the function of the judicial recovery procedure is to preserve the insolvent company by paying off its debts through a judicial recovery plan accepted by creditors, enabling the maintenance of business activity and job creation.

This novelty, combined with the possibility of establishing a single-member limited liability company, company with only one partner in which his personal assets are not directly affected by legal claims against the company; It brings greater legal security to rural producers, encouraging them to undertake in the sector, abandoning the traditional form of entry into agribusiness through individuals, since their liability extends only to the value paid into their company, and there is also the possibility of filing a lawsuit, which in addition to suspending actions arising from debts arising from business activity, has as its main scope the maintenance of the company's economic and social activity.

However, it should be noted that only credits created as a result of their business activity and due at the time of the request for judicial recovery are subject to the judicial recovery procedure and, therefore, are suspended from collection for a certain period.

Therefore, credits that are not linked to agribusiness will be outside the scope of protection of the Judicial Recovery and Bankruptcy Law, and may be collected normally by creditors, as well as credits that originated after the request for judicial recovery.

Therefore, it is extremely important that rural entrepreneurs who wish to file for judicial recovery are well advised by experienced professionals in the area.. The existence of credits not subject to judicial recovery makes the judicial recovery procedure difficult and often frustrates it by depleting the company's assets.

With the collaboration of Luis Felipe Simão