Put: Vitor Antony Ferrari and Ivan Kubala

The National Congress, in session on March 17, 2021, rejected 12 of the 14 presidential vetoes in the text of Law 14,112/2020, which amended the provisions of the Judicial Reorganization and Bankruptcy Law.

On 2/26/2021 we commented that Congress would analyze such vetoes, and that their lack of analysis would result in the suspension of the Voting Agenda, a fact that occurred until the 17th: https://www.mazzuccoemello.com/vetos-presidenciais-na-alteracao-da-lei-de-recuperacao-judicial-devem-ser-pautados-no-congresso-ate-04-03-2021/

After the vetoes were rejected, the text was forwarded to Planalto for presidential promulgation on March 25, 2021, and on March 26, 2021, the President promulgated the text of the rejected vetoes. However, due to an inaccuracy in the text published on the 26th, on today's date, March 30, 2012, there was a new publication in the Official Gazette of the Union, with the necessary corrections consolidating the final text of Law 14.112/2020.

The following articles come into force upon publication in Law 14,112/20 and, consequently, amend the provisions of Law 11,101/2005:

THE PRESIDENT OF THE REPUBLIC I hereby make it known that the National Congress decrees and I promulgate, in accordance with paragraph 5 of art. 66 of the Federal Constitution, the following vetoed part of Law No. 14,112, of December 24, 2020: 

“Art. 1st …………………………………………………………………………………………………..

'Art. 6th …………………………………………………………………………………………………

……………………………………………………………………………………………………………………

• 13. Contracts and obligations arising from cooperative acts practiced by cooperative societies with their members, as per art. 79 of Law No. 5,764 of December 16, 1971, are not subject to the effects of judicial recovery, consequently, the prohibition contained in item II of art. 2 does not apply when the society operating the health care plan is a medical cooperative.' (NR)

'Art. 60 …………………………………………………………………………………………………

Sole paragraph. The object of the sale shall be free of any encumbrance and there shall be no succession of the successful bidder to the obligations of the debtor of any nature, including, but not limited to, those of an environmental, regulatory, administrative, criminal, anti-corruption, tax and labor nature, in accordance with the provisions of § 1 of art. 141 of this Law.' (NR)

'Art. 66 ………………………………………………………………………………………………….

…………………………………………………………………………………………………………………….

'§ 3º Provided that the sale is carried out in compliance with the provisions of § 1º of art. 141 and art. 142 of this Law, the object of the sale will be free of any encumbrance and there will be no succession of the acquirer in the obligations of the debtor, including, but not exclusively, those of an environmental, regulatory, administrative, criminal, anti-corruption, tax and labor nature.

……………………………………………………………………………………………………………..' (NR)”

“Art. 2nd …………………………………………………………………………………………………..

'Art. 6º-B. The percentage limit set forth in arts. 15 and 16 of Law No. 9,065, of June 20, 1995, does not apply to the calculation of income tax and the Social Contribution on Net Income (CSLL) on the portion of net income arising from capital gains resulting from the judicial sale of assets or rights, as set forth in arts. 60, 66 and 141 of this Law, by a legal entity in judicial recovery or with bankruptcy declared.

Sole paragraph. The provisions of caput of this article does not apply in the event that the capital gain arises from a transaction carried out with:

I – legal entity that is controlling, controlled, associated or interconnected; or

II – a natural person who is a controlling shareholder, partner, owner or administrator of the debtor legal entity.'

'Art. 50-A. In cases of renegotiation of debts of a legal entity within the scope of a judicial recovery process, whether or not the debts are subject to this, and the recognition of their effects in the financial statements of the companies, the following provisions must be observed:

I – the revenue obtained by the debtor will not be computed in the calculation of the Contribution for the Social Integration Program (PIS) and for the Public Servant Asset Formation Program (Pasep) and the Contribution for the Financing of Social Security (Cofins);

II – the gain obtained by the debtor with the reduction of the debt will not be subject to the percentage limit set forth in articles 42 and 58 of Law No. 8,981 of January 20, 1995, in the calculation of income tax and CSLL; and

III – expenses corresponding to obligations assumed in the judicial recovery plan will be considered deductible in determining real profit and the CSLL calculation basis, provided that they have not been subject to a previous deduction.

Sole paragraph. The provisions of caput This article does not apply to the hypothesis of debt with:

I – legal entity that is controlling, controlled, associated or interconnected; or

II – a natural person who is a controlling shareholder, partner, owner or administrator of the debtor legal entity.'”

“Art. 4th …………………………………………………………………………………………………..

'Art. 11. Credits and bond guarantees linked to the CPR with physical settlement, in the event of partial or full advance payment of the price, or even representing an exchange operation for inputs (barter), will not be subject to the effects of judicial recovery, with the creditor retaining the right to the return of such goods that are in the possession of the issuer of the bond or any third party, except for reasons of unforeseeable circumstances or force majeure that demonstrably prevent partial or full fulfillment of the delivery of the product.

……………………………………………………………………………………………………………' (NR)” 

Brasilia, March 26, 2021; 200th anniversary of Independence and 133rd anniversary of the Republic. 

JAIR MESSIAH BOLSONARO

Thus, the vetoes were maintained only in paragraph 10 of art. 6 of Law No. 11,101 of February 9, 2005, as amended by art. 1 of the bill, which dealt with the hypothesis that in the judicial recovery, labor executions against the liable party, whether subsidiary or joint, would also be suspended until the approval of the plan or the conversion of the judicial recovery into bankruptcy, and in the sole paragraph of art. 11 of Law No. 8,929 of August 22, 1994, as amended by art. 4 of the bill, which provided that it would be up to the Ministry of Agriculture, Livestock and Food Supply to define which acts and events would be characterized as unforeseeable circumstances or force majeure.

Thus, with the enactment published and duly consolidated in the DOU of 03/30/2021, tax benefits for companies under judicial recovery come into force, as in the case where it is foreseen that the revenue obtained by the debtor in the event of debt renegotiation would not be computed in the calculation of PIS, Pasep and Cofins, and in the case where a tax benefit is foreseen in the calculation of capital gains due to the sale of assets through a judicial auction.

Finally, the full protection of the purchaser of UPIs will also be in force from the date of publication, being free of any burden and there being no succession of the successful bidder in the obligations of the debtor of any nature, including, but not limited to, those of an environmental, regulatory, administrative, criminal, anti-corruption, tax and labor nature, in compliance with the provisions of articles 60, 66, § 1º of art. 141 and 142 of Law 11.101/05.

Notwithstanding the presidential enactment of the rejection of the vetoes brought by the National Congress, the text now consolidated in Law 14.112/2020 has several significant changes that must be examined rigorously, as they must be observed by all companies that intend to avail themselves of the recovery process, as well as by companies that are already in judicial recovery, since the law must also be applied immediately to pending processes as soon as it comes into force.