Working group proposes measures to optimize judicial reorganization and bankruptcy proceedings.

Two proposed regulations to improve corporate recovery in the courts have been consolidated by the working group operating within the National Council of Justice (CNJ) to contribute to the modernization and effectiveness of the Judiciary's performance in judicial reorganization and bankruptcy proceedings. One deals with parameters for the creation of a registry of judicial administrators by the courts, and the other provides for direct communication with foreign courts in cases of transnational insolvency.

Established by CNJ Ordinance 199/2020, the group aims to continue the action initiated in 2018 to modernize, increase the effectiveness, and reduce bureaucracy in the Judiciary's actions in these processes, and even suggest new legislative developments, such as the new Bankruptcy and Corporate Reorganization Law (Law No. 14,112/2020), which came into effect in January.

The coordinator of the group, Minister Luís Felipe Salomão of the Superior Court of Justice (STJ), reaffirmed, at the last meeting on February 19, the importance of the work for the current Brazilian moment, contributing to improving the business environment and unlocking the country's economy. "Good governance in recovery and bankruptcy processes is one of the best indicators for this. Therefore, I congratulate the members of this working group, given their productivity and stability."

Proposals

The judge overseeing these cases is responsible for appointing the person who will manage the bankruptcy and fiscal affairs of the companies. To ensure greater transparency in the selection process, the courts should create Registries of Judicial Administrators, where interested individuals should register and submit their resumes, detailing their technical training and professional experience in the field. Some courts already have their own registries. The proposal from the CNJ (National Council of Justice) group is to establish minimum requirements for each court to create its own registry.

The second proposed consolidated rule establishes rules for cooperation and direct communication with foreign courts for the processing and adjudication of transnational insolvencies, which are those of multinational companies that request bankruptcy protection in more than one country. Direct communication eliminates a series of formalities imposed on the court, such as the issuance of letters rogatory, which requires a lengthy procedure that is incompatible with the needs of a recovery or bankruptcy process.

“The drafts approved by the Working Group will be presented to the CNJ Plenary and are part of the set of measures being developed within the Council to provide greater speed, effectiveness and legal certainty in the complex processes of judicial reorganization and bankruptcy,” informed Councilor Marcos Vinícius Jardim Rodrigues. He joined the group in February, due to the conclusion of Henrique Ávila's term at the CNJ.

In his last meeting as a member of the CNJ (National Council of Justice), Ávila pointed out that direct cooperation and communication are essential to the transnational management of insolvency proceedings. “One of the resolutions establishes the minimum criteria to ensure that these protocols comply with global standards. The guide from the Judicial Insolvency Network, a group of specialized judges from various countries around the world, was used as a basis.” He remains in the group due to his experience in law practice.

The appointment of Councilor Marcos Vinícius was published in Ordinance 61/2021. “It is an honor to be part of a distinguished group of jurists who, for more than two years, have been contributing to the improvement of the Justice system, strengthening institutions for the preservation of the social function of companies and stimulating economic activity, especially during times of economic and financial crises.”

Source: CNJ