Justice partially anticipates effects of Oi’s judicial recovery

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The 7th Business Court of the Judicial District of Rio de Janeiro anticipated, this Thursday (2), partially the effects of Oi’s judicial recovery.

The company had come out of a recovery process in December last year. In the new action, judge Fernando Cesar Ferreira Viana argues that the effects of the request have not yet been stabilized by the final and unappealable decision by formulators OI SA, Portugal Telecom International Finance BV and Oi Brasil Holdings Cooperatief UA

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“Such caveat is relevant because, in a recent decision, the 4th Panel of the Superior Court of Justice (STJ) understood that, while the decision terminating the judicial reorganization has not become final and unappealable, the competence of the reorganization court remains for the administration of the assets of the recovering,” he explains.

“In this context, if this court still has the competence to manage the Applicants’ assets, even if the first judicial reorganization filed is closed, it must also be considered that there is still a need to observe the prevention rule contained in § 8 of art. 6 of Law 11.101/2005”, he continued.

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The cited article says:Art. 6 The declaration of bankruptcy or the granting of the judicial reorganization process implies: § 8 The distribution of the bankruptcy or court-supervised reorganization request or the homologation of extrajudicial reorganization prevents jurisdiction for any other bankruptcy filing, judicial reorganization or approval of extrajudicial reorganization related to the same debtor.”

From there, it was defined:

  • Suspension of the enforceability of all obligations relating to the instruments entered into with the institutions listed, for example, in the list attached to the exordial, and all entities of their economic groups (and their successors and assignees in any capacity), which constitute credits subject to the process of main judicial reorganization, under the terms of the LRF, but not limited to them, and the suspension must be extended to all other instruments linked to the institutions listed in the annex and all entities of their economic groups (and their successors and assignees in any capacity ), as well as any instruments that may be declared terminated and/or expired in advance on the date of this request, the effects of default, including, for recognition of arrears, and any claims of retention, attachment, attachment, seizure, search and seizure , judicial or extrajudicial compensation and restriction on the Applicants’ assets, arising from judicial demands formal or extrajudicial, as well as the execution and collection of amounts owned by the Applicants, which are provisionally owned by third parties, especially those related to the payment of interest to qualified bondholders in the form of the PRJ, and to Fundação Atlântico de Seguridade Social, also in the PRJ terms, due on 2.6.2023;
  • The suspension of the effects of any and all clauses that, due to this precautionary preparatory recovery request, the future request for judicial recovery and/or the circumstances inherent to its state of crisis, (a) impose the early maturity of debts and/or of the contracts entered into by the Applicants, and/or (b) authorize the suspension and/or termination of contracts with suppliers of essential products and services for Grupo Oi, determining that suppliers of essential products and services do not unilaterally change the volumes of products and/or services provided solely as a result of this precautionary request, the future request for judicial recovery and/or the circumstances inherent to its state of crisis;
  • Determine the waiver of presenting clearance certificates under any circumstances, including for the Applicants to carry out their activities and to obtain tax benefits.

Last Wednesday (1st) the company had asked the court for an injunction to protect it from creditors with which it holds approximately R$29 billion in debt, including banks and bondholders.

The argument used was that he tried to reach an agreement with creditors to refinance his debt, but so far he has not been successful.

Oi said it cannot pay R$600 million owed to bondholders on Feb. 5, which would trigger an acceleration of nearly all of the company’s financial debts.

After the case was confirmed in a material fact, Oi’s common shares closed down 31.78% to R$ 1.61.

(*Posted by Douglas Porto)

Source: CNN Brasil

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