Publications

Category: Litigation

The breach of data confidentiality of social networks users has raised relevant debates in the legal and social environments. If on the one hand it is recognized that the user of social networks can freely exercise their freedom of speech, on the other hand it is certain that this freedom is limited by the personality rights of other people.

Recently, the Superior Court of Justice (STJ) published the newsletter 720, which highlights the trial of REsp 1.914.596/RJ, rapporteurship of Minister Luis Felipe Salomão. In this trial the Fourth Panel unanimously decided that internet access providers must provide the registration data (name, address, identity and CPF) of users responsible for posting videos with slanders to the memory of former councilwoman Marielle Franco.

Although the judgment has not yet been drawn up, it is possible to draw some relevant conclusions from the judgment, which is fully available in the stj channel in the YouTube. The first concerns the discussion about the breach of confidentiality of an internet user's registration data when they have committed an unlawful act, which could allow victims to use that data to exercise their rights.

In the specific case, Marielle Franco's family filed a lawsuit against Google (administrator of YouTube) asking for the removal of offensive videos to the former councilwoman, which was granted in the District Court and confirmed by the Court of Appeal of  Rio de Janeiro (TJ /RJ). Google was also requested to break the confidentiality of data of those who carried out the offensive postings, which was denied by the court.

The state court rejected the request for a letter dispatch to internet access providers to provide the full identification of those responsible for the postingof the videos, under the following arguments:

• judicial intervention for the identification of connection providers should be unnecessary;
• the breach of data confidentiality must occur through criminal procedure;
• impossibility of conviction outside of what was requested by the author; and
• impossibility of convicting third parties who did not join the court.

However, the minister rapporteur Luis Felipe Salomão rejected, one by one, all these arguments, being established that, in the face of evidence of illegality, the only way to obtain data protected by secrecy, as a way to instruct civil and criminal proceedings, is through judicial intervention. The position reaffirmed what is already expressly provided for in Article 22 of the Civil Framework of the Internet – MCI (Law 12.965/14) and is in line with the recent jurisprudence of the Supreme Court on the subject (

According to the minister if you have an ongoing court case, this doesn’t breach the data protection act because it doesn’t fall within the definition of protection of the flow of information, outlined in law 9.296/96, but the court proceedings assesses the level of indemnification for the breach of the data protection act.

In relation to the third argument, the minister clarified that the request for user identification  is in full line with the cause of the action and even added that the jurisprudence of the Supreme Court allows the magistrate to extract from the logical-systematic interpretation of the application what the party intends to obtain from the action.

Another relevant point highlighted by the Minister concerns the need to prove the evidence of illegality in the user's conduct and that the request for breach of confidentiality is specific. In the specific case, the request was specific to provide the data of the users who actually posted the offensive videos, whose IPs had already been provided by Google. It is worth remembering that the STJ has already dismissed a claim to breach the confidentiality of data of users who shared a video which speech that later was considered offensive (REsp 1.859.665/SC).

For the minister there is no need to talk about conviction of third parties because the case refers to the hypothesis of duties imposed on third parties in order to assist the fulfillment of court orders, as stipulated by the arts. 77 and 139 of the Code of Civil Procedure.

There is a more recent understanding of the STJ (REsp 1,306,157/SP) that the access provider is obliged to identify, based on IP, internet user author of an illegal act, when provoked by the Judiciary, even if the act was practiced before the validity of the Civil Framework of the Internet.

In giving the special appeal, the minister stressed that such conclusions do not conflict with the General Data Protection Law - LGPD (Law 13.790/18), because it does not exclude the breach of confidentiality. In addition, the provision of information by internet connection providers should comply with the rules provided for in the arts. 23 and following the LGPD.

With this decision, Minister Luis Felipe Salomão reaffirms the position he already held in 2014, when he declared that "the judiciary can and should be inducing civilizing agendas of behaviors in the world computer network".^[1] The breach of data secrecy thus becomes an important mechanism for the enforcement of the right of those who have their personality rights violated in social networks. It is also relevant the indication of the STJ that such a mechanism can be exercised in civil claims and does not contradict the LGPD.

^[1] REsp 1,306,157/SP

Category: Tax

One of the greatest virtues of the Judiciary is to pacify social relations through the jurisprudence it creates on the various themes that are submitted to it. It happens that, in Brazil, even today, attempts to resurrect issues already faced by the courts are recurrent.

As an example, we can mention Law 4.117/03 of the state of Rio de Janeiro, which aimed to create the ICMS on oil extraction, a theme addressed in the Direct Action of Unconstitutionality (ADI) 3,019/RJ in 2005.

Years later, another law in Rio de Janeiro, Law 7.183/15, intended to reestablish the collection of ICMS on oil extraction, which was rejected by the Supreme Court (STF) in 2021 in ADI 5.481/RJ.

The same happened with the so-called Environmental and Regulatory Surveillance Fee of Oil and Gas Exploration and Production Activities (TFPG). Created by State Law 7.182/15 - RJ, the fee should be paid by taxpayers who exploited the extraction and production of oil. By law, its value would have to be fixed according to the amount extracted from barrels of oil.

Faced with widespread protests against the requirement of the fee, which followed a pattern quite similar to that of other police power charges, it was up to the Supreme Court to examine the subject, as it had done in relation to the Control Fee, Monitoring and Supervision of Activities of Exploitation and Use of Water Resources (TFRH).

In one of the pioneering cases about the unconstitutionality of police power charges that do not observe the equivalence between what is collected and the cost of state service to be remunerated, we advocate from the court of the plenary of the Supreme Court.

In the trial of ADI 6.211/AP, which specifically involved the collection of TFRH created by the state of Amapá, the minister rapporteur Marco Aurélio Mello voted for the unconstitutionality of the collection, because there is no obligation / referable character, and its collection is confiscatory. In his vote, the minister rapporteur stressed that "the rate always presupposes a cost to be satisfied, and must have an intimate relationship with the activity performed by the State".

Based on this understanding, soon after, Law 7.182/15 was deemed unconstitutional by the Supreme Court in ADI 5.480 / RJ, putting an end to TFPG.

The state of Rio de Janeiro, however, again intends to reinstitute the very same TFPG, through Bill 5.190/21, which was pending only the government sanction. The curious thing is that the new TFPG basically repeats the old TFPG. The only differences between the two refer to the following points:

• the calculation basis of the new TFPG is a fixed value per month, while in the old TFPG the value fluctuated according to the amount of barrels produced; and
• the new TFPG provides for the allocation of part of its collection to the state environmental agency, in addition to the State Attorney General's Office and the State Treasury Department.

We understand that the new rate, in the same way as the old one, incurs in unconstitutionality, because its collection needs to be compatible with the cost of state activity to be remunerated, an indispensable requirement of validity and adaptation to the constitutional precepts of any rate of police power.

Unlike taxes (“impostos”), charges are taxes linked and referable precisely because they aim to remunerate a certain state activity.

By being calculated in very high monthly fixed value (about R$ 5 million per month, per concessionaire), the new TFPG is far from the cost of state activity to be developed with the resources from its collection. Proof of this is that the supervision of oil exploration and production activities are already developed at the state level by the State Institute of the Environment (Inea), whose collection obtained with all fees for the exercise of police power in the years 2017, 2018 and 2019 totaled, respectively, R$ 11,462,499.23, R$ 15,855,731.62 and R$ 11,310,219.51, as disclosed in the last Inea/2019 Activity Report.

If we consider the number of concessionaires authorized to carry out research, mining, exploration and production of oil and gas existing in Rio de Janeiro, we will have a collection of R$ 150 million only by concessionaires in the Campos Basin – according to the National Petroleum Agency (ANP), only in this basin there are 30 authorized concessionaires in the state. This amount represents about 388% of the revenue obtained by Inea with all police power fees in the years 2017, 2018 and 2019.

The constitutional principles of transparency, good faith and morality require public managers to decline and share with society and parliament itself all empirical data examined and weighted for the creation of new taxes. It would therefore be commendable if the legal justification of the new TFPG was accompanied by this information, in particular, the estimated cost of state activity to be remunerated.

In addition, by establishing as a taxable person of the rate any and all "legal entity that is, in any capacity, authorized to carry out research, mining, exploration, and production of oil and gas resources", the new TFPG ceases to observe and considers that several concessionaires, although authorized by the ANP to explore and produce oil and gas, are not carrying out these activities at the moment.

It makes no sense to establish the collection of a fee for the exercise of police power over taxable persons who are not even in the full exercise of the activity to be supervised. In this case, there is no necessary accountability/referable nature of the fee.

Another issue that draws a lot of attention in the new TFPG is the fact that part of its collection is destined to the State Attorney General's Office and the State Department of Finance.

These bodies have unique relevance in the collection and judicial representation of state agencies. However, both have no direct and reference relationship with the police power to be remunerated with the new TFPG.

Initiatives like these scare away new investors and shake the confidence of those who already make their investments in Rio de Janeiro, as well as go against the desired economic recovery of the state's troubled public accounts.

It is an anima to know that, apparently, the governor of Rio de Janeiro did not sanction the bill, a measure agreed to retain the investments already made by oil and gas concessionaires in the state and avoid the unwanted flood of litigation that will come, if the Rio de Janeiro State parliament keep the governor´s rejection.

Category: Infrastructure and energy

2021 ended bringing a new package of changes for Brazilian aviation, which is still suffereing the consequences of the significant demand recudtion caused by the pandemic. The changes were implemented through Provisional Measure (MP) 1,089/21, edited in the context of the Simple Flight Program (Programa Voo Simples), a partnership between the National Civil Aviation Agency (Anac) and the Federal Government created in 2020 to modernize and simplify the national aviationsector.

MP 1,089/21 amended and revoked articles of the Brazilian Aeronautical Code (Law 7.565/86 – CBA), the law that created Anac (Law 11.182/05) and Law 6.099/73, which regulates the use and operation of airports in Brazil. Law 5.862/72, which provides for the creation of the Empresa Brasileira de Infraestrutura Aeroportuária (Infraero), also had a small change, with the extinction of the mandatory intervention of the Federal Government in lawsuits in which Infraero is a party.

The main objective of the changes implemented by MP 1.089/21 is to make issues related to the aeronautical sector less bureaucratic and costly. One of the most significant changes was the revocation of  articles of the CBA that required foreign airlines interested in operating international flights in Brazil to obtain authorization from the Ministry of Foreign Affairs (or other competent body) of their country of origin and an operating authorization issued by Anac, as a representative body of the Federal Government.

According to the new provisions, to operate international air transport services, foreign companies must obtain only one operating authorization, to be issued in accordance with regulations issued by Anac. The simplification of the process should attract new investments for the sector and may promote the entry of new airlines into the market, increasing competition and  the provision of services.

Another measure to reduce bureaucracy was the revocation of the CBA article which determined the revalidation of operating authorizations of companies providing domestic air transportation services every five years. It also worth mentioning that the new wording given to Article 40 of the CBA, which now exempts air service providers from the public bidding process for the use of areas for dispatch services, office, workshop, warehouse or shelter, repair and refueling of aircraft. In relation to airports , one of the main amendments was the revocation of Article 34 of the CBA, which required prior authorisation from the aeronautical authority before an airport could be built.

Relevant changes have also been implemented in relation to the concession regime previously applicable to airlines. As a result of the revocation of Articles 177 to 191 of the CBA, the concession regime is no longer applicable and air services will now be considered as economic activities of public interest subject to the regulation of the civil aviation authority in accordance with the new wording of Article 174. The revocation of the above mentioned articles excluded the legal definitions of the concepts of public air service and private air service. According to the new sole paragraph of Article 174, issues relating to sceduled and non-scheduled air services will be regulated with exclusively through regulatory rules issued by Anac, in compliance with the international agreements to which Brazil is a signatory.

In practice, the revocations and amendments to the CBA transferred to Anac the competence to decide on operational and procedural issues through infralegal rules that, in theory, can be changed more easily and, therefore, adapt more quickly to the constant changes required by market dynamics.

MP 1,089/21 also deals with a series of revocations and inclusions of new provisions to simplify aircraft registration and certification procedures and processes at the Brazilian Aeronautical Registry (RAB), as well as creating new categories of civil aviation taxes and inspection fees (TFAC).

The amendments introduced by MP 1089/21 came into force on 30 December 2021 (except for the annex dealing with the new supervisory fees, which will enter into force 90 days after publication). According to constitutional rules, the provisional measure must be converted into law within 60 days from its issuance, being such period extendable once for another 60 days if the voting process  in the Senate and the House of Representatives has not been completed. If the legislative decree is not issued within the legal period, the provisional measure loses effectiveness, and only the acts performed during its validity will remain governed by it.

The Brazilian aviation sector is still recoveringand the changes introduced by MP 1,089/21 indicate a willingness of the Federal Government and Anac to reduce bureaucracies in the sector to boost activities and enable the survival of airlines and other air service companies.

Category: Real estate

The promotion of agribusiness connected to environmentally sustainable development issues gains a new instrument with the regulation of Law 8,929/94 by Decree 10,828/21 published on October 4th of this year.

The Rural Product Note (“Cédula de Produto Rural” -CPR) is a credit instrument used by rural producers to enable the production and commercialization of their products. The CPR was instituted by Law 8,929/94, and Decree 10,828/21 regulates issuances for rural products obtained through activities of conservation and recovery of native forests and their biomes, which earned it the title of Green CPR.

According to article 2, subsections I to VII, of the decree, the issuance of Green CPRs is authorized, provided that these rural products are able to reduce greenhouse gas emissions, maintain or increase forest carbon stock, reduce deforestation and degradation of native vegetation, conserve biodiversity, water resources, soil, or provide other ecosystem benefits.

The decree puts into practice the regulation provided for in article 42 of Law 13,986/20, known as the Agro Law, which, in turn, amended article 1, paragraph 2, subsection I, of Law 8,929/94. The change included the list of activities through which rural products are obtained for the issuance of CPRs. The regulation is a way to encourage the preservation of the environment in rural areas and to value sustainable practices.

According to information on the federal government’s website “the instrument will allow companies interested in mitigating their greenhouse gas emissions to acquire the securities upon the commitment of the producer to maintain the conserved area. A Green CPR connects the company that wants to be environmentally sustainable with the rural producer. Thus, at the same time that rural producers finance their activities, there is a financial incentive to preserve rural areas.

The legislation provides for other modalities of CPR. However, while in Physical CPR’s the obligation is to deliver the product and in Financial CPR’s it is to pay the amount provided for in the security, in Green CPR’s the producer commits to environmental preservation in exchange for the financial resources it needs.

Those who conserve water resources, soil, and biodiversity and reduce greenhouse gas emissions, among other benefits stipulated in article 2 of the decree, may receive financial resources to make their production viable.

According to article 3 of Decree 10,828/21, this type of CPR must be certified by a third party, to indicate and specify the rural products that back it. This certification aims to ensure the objective of environmental preservation to which the issuer of the CPR has committed itself. Thus, it seems to us that the Green CPR market will also encourage the development of environmental preservation certification activities in rural areas to back the issuance of the security.

Considering that the decree has only four articles, the expectation is that soon new information and guidelines for issuing Green CPR’s will be published. However, despite the concise regulation, the provision for this credit security represents an advance in the promotion of agribusiness in line with environmental preservation in the rural environment.

Category: Tax

Historically, case law has tended to reduce the influence of tax liabilities on judicial reorganizations, with the recurrent relaxation of the rules on mandatory proof of good tax standing for companies petitioning for judicial reorganization (articles 191-A of the National Tax Code^[1] and 57 of Law 11,101/05).^[2] Thus, reorganization plans used to be granted regardless of the existence of material tax debts. Due to a new regulatory and tax scenario, combined with the advent of Law 14,112/20, there has been a change in this system, with a much stronger presence of the tax authorities in the judicial reorganization proceedings.

Initially, the Superior Court of Appeals (STJ) set aside the requirement for good tax standing in judicial reorganizations, based on a teleological interpretation: based on the premise, which is true, that companies resorting to judicial reorganization had high tax liabilities, the requirement of a certificate of good tax standing could make any reestablishment of a company in crisis unfeasible, especially in a scenario in which the legislation did not provide for special measures aimed at tax recovery of the company in crisis.

In effect, although Law 11,101/05 and article 155-A, paragraph 3, of the National Tax Code^[3] enunciate the possibility for the Public Treasuries to grant installment payments of their debt claims in the context of judicial reorganizations,^[4] initially, there was no specific legal provision to institute this type of installment payment. In the legislative scenario at the time, the STJ decided^[5] that the requirement for a clearance certificate (or positive certificate with effect of clearance) for tax debts represented an affront to the very purpose of the concept of judicial reorganization, which is “to make it possible to overcome a situation of economic and financial crisis on the part of the debtor, in order to allow maintenance of the source of production, employment of workers, and the interests of creditors, thus promoting the preservation of the company, its social function, and stimulus of economic activity.”^[6] Given the lack of a specific law regulating the installment payment of tax and social security debts of companies under judicial reorganization, therefore, the requirement for good tax standing is now waived.

Even the legislative innovation promoted by Law 13,043/14, which inserted a special installment plan for the judicial reorganization context, was not enough to change the guidance established by the STJ.

Since the inclusion of article 10-A in Law 10,522/02 (inserted by Law 13,043/14 and repealed by Law 14,112/20), there is now a specific installment payment plan for companies under judicial reorganization:^[7] the payment of debts could be made within up to 84 consecutive monthly installments calculated in increasing amounts, from the 1st to the 12th installment: 0.666%; from the 13th to the 24th installment: 1%; from the 25th to the 83rd installment: 1.333%; and the remaining balance due on the 84th installment.

Despite this legislative innovation, the STJ has repeatedly maintained the position that good tax standing is not necessary for the judicial reorganization purposes. The reasoning behind the decisions evolved along the lines that it would be more appropriate to give prevalence to judicial reorganization, and its intention to effectively ensure the reorganization of companies in crisis, to the detriment of tax regularization.

In some decisions, the unreasonableness of the good tax standing requirement was highlighted because: "the legal requirement is not adequate for the purpose it pursues, to guarantee payment of the tax debt, nor does it seem necessary to achieve this purpose: (i) inadequate because, by preventing the granting of judicial reorganization to a debtor in an irregular tax situation, it imposes an even greater difficulty for the Tax Authorities, in view of the classification of the tax debt, in the event of bankruptcy, in third place in the order of preference; (ii) unnecessary because the means for collection of tax debts are not suspended with the granting of the application for reorganization."^[8]

As a result of the jurisprudential guidance for the setting aside of the good tax standing requirement, controversies have arisen with regard to the simultaneous processing of judicial reorganizations and tax executions.^[9]

In particular, situations were discussed in which a judicial reorganization was negatively impacted by foreclosure measures determined by the courts in tax foreclosures: not infrequently, assets of entities undergoing judicial reorganization, relevant to the fulfillment of the plan approved by the general meeting of creditors, were seized to guarantee or even pay tax debts.

In analyzing this aspect of the debate on judicial reorganization and the collection of tax debts, the First Section of the STJ held that "tax enforcement is not stayed by the granting of judicial reorganization, allowing the performance of constrictive acts, especially when it is evidenced that the company under reorganization failed to take the measures necessary to suspend the enforceability of tax debts, especially through the special installment plan governed by article 10-A of Law 10,522/2002, included by Law 13,043/2014."^[10]In turn, the Second Section of the STJ has held that “the granting of judicial reorganization does not suspend tax enforcement, but acts involving attachment or disposal of the assets of the company under reorganization must be submitted to the bankruptcy court (...) the enactment of Law 13,043/2014 - which added article 10-A to Law 10,522/2002 and disciplined the installment payment of debts of companies under judicial reorganization - does not (...) have the power of altering the jurisprudential understanding highlighted."^[11]

Thus, the First and Second Sections of the STJ have established divergent positions on the subject by drafting decisions according to the limitations of their competencies. Faced with the clash of public vs. private interests, the First Section, which is competent to judge public matters (especially in disputes over tax foreclosures), emphasized the jurisdiction of the tax foreclosure court to the detriment of the judicial reorganization court. Meanwhile, the Second Section, which decides on private matters (including disputes arising from judicial reorganizations), has favored the opposite: the superimposition of the judicial reorganization court over the tax foreclosure court.

This jurisprudential disagreement justified: (i) the filing of a conflict of jurisdiction to define which Section of the STJ had jurisdiction to decide on conflicts between the tax enforcement and the judicial reorganization courts; and (ii) the allocation, by the First Section, of appeals for judgment under the system of repetitive appeals to decide on Topic 987:^[12] "possibility of performing constrictive acts against a company under judicial reorganization in the tax enforcement system."

The jurisdiction of the Second Section was established as prevailing^[13] to “try and decide conflicts of jurisdiction between the court of judicial reorganization and that of tax foreclosure, whether by the criterion of specialty or by the need to avoid disparate judgments and the consequent legal insecurity.

As a consequence, Topic 987 ended up being withdrawn^[14] due to the recognition of the competence of the Second Section to decide the dispute (remember that the allocation of the appeals had been undertaken by the First Section) and for an additional reason: the supervening enactment of the changes made by Law 14,112/20 in Law 11,101/05, which now sets forth that the granting of judicial reorganization does not hinder collection through tax foreclosures, "admitting, however, the competence of the judicial reorganization court to mandate the substitution of the acts of constriction that fall on capital assets that are essential to maintain the business activity until the termination of the judicial reorganization, which shall be implemented through jurisdictional cooperation, pursuant to article 69 of Law No. 13,105, of March 16, 2015.” This provision resolved the conflict between judicial reorganization and tax foreclosure courts.

This digression on the STJ case law regarding the topics of judicial reorganization, tax compliance, and tax foreclosures is fitting to elucidate the intrinsic relationship between them and the fact that Law 14,112/20 has already had repercussions in the STJ. The issue is that other provisions of Law 14,112/20, linked to recent tax rules, are impacting other aspects of the processing of judicial reorganizations, in particular the restricted applicability of the understanding on the mitigation of the requirement for a tax clearance certificate in judicial reorganizations.

Since Law 14,112/20 made changes to the Company Reorganization and Bankruptcy Law, there has been an increasing participation by the tax authorities in judicial reorganization. This change is in line with the fact that the new legislation established rules for the installment payment of debts of companies under judicial reorganization and referenced the alternative ways of settlement and procedural legal transactions to settle tax liabilities.

Law 14,112/20 inaugurated new modalities of special installment plans for companies under judicial reorganization (and repealed the installment plan then provided for by Law 13,043/14), namely:

• Within up to 120 installments, from the 1st to the 12th, 0.5%; from the 13th to the 24th, 0.6%; and from the 25th onwards, a percentage corresponding to the remaining balance, within up to 96 successive monthly installments;
• Settlement of up to 30% of the debt with credits arising from tax losses and negative basis of the Social Contribution on Net Income or with other own credits related to the taxes managed by the Special Bureau of the Federal Revenue of Brazil and installment payment of the remaining balance within up to 84 installments, from the 1st to the 12th, 0.5%; from the 13th to the 24th, 0.6%; and from the 25th onwards, a percentage corresponding to the remaining balance, within up to 60 successive monthly installments;
• Taxes, as a rule, that cannot be paid in installments: subject to withholding, discount from third parties or subrogation, as well as IOF withheld and not paid to the National Treasury (article 14 of Law 10,522/02).

Moreover, Law 14,112/20 incorporated into the judicial reorganization legislation a reference to the alternative of tax debt equalization through a settlement proposal related to debt claims, under the terms of Law 13,988/20. In this case, the maximum payment term can reach 145 months, with reductions of up to 70%.

Both the special installment payment modalities for companies under judicial reorganization and the framework for tax settlements were regulated by the Brazilian Federal Revenue Service and/or the National Treasury Attorney's Office, so that they can already be implemented by companies under judicial reorganization.^[15]

Added to this regulatory context is the recent regulation of the institute of procedural legal transactions, which may deal with the acceptance, evaluation, substitution, and release of guarantees or settlement of debts recorded as collectible debt of the Federal Government and the FGTS. This alternative is supported by the supplemental legislation^[16] and Law 10,522/02^[17] and was disposed of by the Attorney General’s Office for the National Treasury through Ordinance PGFN 742/18.

As can be seen, at present (and contrary to what prevailed at the time when the STJ's understanding was established for waiving the requirement of good tax standing in judicial reorganization), companies under judicial reorganization have means, in conceptual terms, even significantly beneficial and comprehensive, for regularization before the tax authorities. This is why there is a more incisive role for the tax authorities in judicial reorganizations, and the validation of this stance by court decisions for which the legal requirement for a tax clearance certificate in judicial reorganizations is no longer justified.

The appellate judge Cesar Ciampolini, from the 1st Chamber Reserved for Business Law of the Court of Appeals of the State of São Paulo, issued a sole judge decision accepting the treasury’s petition for the suspension of the judicial reorganization until the tax liabilities are settled.^[18] In this case, the judicial reorganization plan had been ratified without the presentation of a tax clearance certificate, under the theory that evidence of "positive conduct of the debtor that does not have its tax situation solved" would be sufficient for granting judicial reorganization, with the proviso that such a measure would not be appropriate only in the case of a delinquent debtor or one that proves to be negligent with regard to the obligation to pay what it owes to the tax authorities. The decision was reversed in court based on Law 14,112/20: it was established that the advent of the law imposes the requirement for clearance certificates for the granting of judicial reorganization, as an important legislative initiative to restructure the judicial reorganization procedure and prevent public claims from being placed in second place and settled after the payment of private creditors.

In the case of the judicial reorganization of Maralog Distribuição S.A., the 2nd Chamber Reserved for Business Law of the Court of Appeals of the State of São Paulo granted the interlocutory appeal filed by the Federal Government (National Treasury) against a decision that had dismissed the requirement of proof of good tax standing of the company under reorganization.^[19] In this case, Maralog supposedly went from a situation of giid tax standing, in effect at the time the judicial reorganization was granted, to a situation of tax irregularity. In hearing the case, the court found that equalization of the tax debt was mandatory, especially based on the rules introduced in the legal system by Law 14,112/20 (which allowed the installment payment of debt claims of businessmen or business companies whose judicial reorganization has been granted), under penalty of conversion of the judicial reorganization into bankruptcy.

The Attorney General's Office for the National Treasury of the Regional Office of Uberlândia/Minas Gerais filed a complaint in the record of the judicial reorganization of Samarco Mineração S. A.^[20] to request its inclusion in the case as an interested third party, stating the amount of the debts recorded as overdue federal liability in an irregular situation and the instruments available for negotiation of the debt, and requesting that the company be summoned to procure equalization of the tax liability. After the judge ordered Samarco to be heard,^[21] the company reported that it was in talks with the Public Prosecutor's Office to enter into a legal procedural settlement and, subsequently, attached to the record of the judicial reorganization the instrument of the legal procedural settlement in camera.^[22] In hearing the company's petition, the judge order that the confidentiality of the terms agreed upon "is incompatible with the judicial reorganization process, since knowledge about the tax liabilities is of interest to all the participants in the proceeding," ordering the document to be made available to the parties.^[23] Samarco's court-supervised reorganization plan was still pending review in the court at the time of this article's publication.

In the case of Odebrecht S. A. and other companies, before the advent of Law 14,112/20, the judicial reorganization was granted with the proviso that the company in reorganization should adjust its tax liabilities within one year.^[24] in order to avoid probable controversy on the subject, the companies that had not yet attached their tax clearance certificate to the case record did so.^[25]

In Rio de Janeiro, the decision that had ratified the judicial reorganization of Hotéis Othon S/A and others^[26]  was annulled by the 16th Civil Chamber of the Court of Appeals to enforce the requirement of the tax clearance certificate, because, for the reporting judge, the denial of the application of such provision, together with the restrictions on the seizure of assets of the company under reorganization, would lead to undue reduction of the “tax debt, ignoring its dignity and the relationship between taxes and fundamental rights.” Pursuant to the appellate decision, one emphasized the constitutionality of article 57 of Law 11,101/05, especially under the "new clothing" given to it by Law 14,112/20, which maintained the requirement of tax compliance for the granting of judicial reorganization, guaranteeing the extension of the deadline for payment of the debt up to 120 months.

In the judgment of a constitutional complaint filed against a decision by the STJ that had ruled out the observance of article 57 of Law 11,101/05, Justice Luiz Fux,^[27] of the Federal Supreme Court (STF), granted an in limine relief to suspend the effects of the decision, based on the understanding that the judicial reorganization system imposes on the debtor, in addition to negotiating with private creditors, regularization of its tax situation, which, at present, can be done even through a tax settlement (Law 13,988/20). Although this decision was reversed,^[28] the decision expressly considered the new regulatory scenario that has led to a change in case law on the effects of tax liabilities in judicial reorganizations. Justice Luiz Fux's decision has even guided the understanding expressed by the Special Body of the Paraná Court of Appeals, which dismissed the argument of unconstitutionality to establish the constitutionality of article 57 of Law 11,101/05, on September 21, 2020.^[29]

Based on these examples, it is possible to confirm that the evolution of instruments to equalize tax liabilities is leading to a change in the processing of judicial reorganizations, with closer relations between the companies under reorganization and the tax authorities and greater emphasis on good tax standing. It is up to the company in economic and financial crisis to explore the new alternatives for negotiating its tax debts, in the terms that best meet the particularities of its situation, in order to avoid clashes in the judicial reorganization.

^[1] Article 191-A. Granting of judicial reorganization depends on presentation of proof of clearance of all taxes, with due regard for the provisions of articles 151, 205, and 206 of this Law. (Included by Lcp No. 118, of 2005)

^[2] Article 57. After the plan approved by the general meeting of creditors has been attached to the case record or after the time limit provided for in article 55 of this Law without objection from creditors, the debtor shall submit clearance certificates for tax debts pursuant to articles 151, 205, 206 of Law No. 5.172, of October 25, 1966 - National Tax Code.

^[3] Article 155-A (...) Paragraph 3. A specific law shall provide for the conditions for installment payment of tax debts of the debtor under judicial reorganization. (Included by Lcp No. 118, of 2005)

Paragraph 4. The non-existence of the specific law referred to in paragraph 3 of this article means that the general installment payment laws of the State shall apply to the debtor under judicial reorganization; in this case, the installment payment term cannot be shorter than that granted by the specific federal law. (Included by Lcp No. 118, of 2005)

^[4] Article 68. The Public Treasuries and the National Institute of Social Security (INSS) may grant, pursuant to specific legislation, installment payment of their debt claims, in the context of judicial reorganizations, in accordance with the parameters established in Law No. 5,172, of October 25, 1966 (National Tax Code).

^[5] BUSINESS AND TAX LAW. SPECIAL APPEAL. JUDICIAL REORGANIZATION. REQUIREMENT THAT THE COMPANY IN REORGANIZATION MUST PROVE ITS GOOD TAX STANDING. ARTICLE 57 OF LAW N. 11,101/2005 (LRF) AND ARTICLE 191-A OF THE NATIONAL TAX CODE (CTN). INOPERABILITY OF THE AFOREMENTIONED PROVISIONS. ABSENCE OF A SPECIFIC LAW REGULATING THE INSTALLMENT PAYMENT OF TAX AND SOCIAL SECURITY DEBTS OF COMPANIES UNDER JUDICIAL REORGANIZATION. 1. Article 47 serves as a guideline to guide the operation of judicial reorganization, always aiming at the institute's purpose, which is "to make it possible to overcome a situation of economic and financial crisis on the part of the debtor, in order to allow maintenance of the source of production, employment of workers, and the interests of creditors, thus promoting the preservation of the company, its social function, and stimulus of economic activity.” 2. Article 57 of Law No. 11,101/2005 and article the provisions of article 191-A of the CTN must be interpreted in light of the new guidelines established by the legislator for tax debts, particularly in view of the legal provision for the installment payment of the tax debts on behalf of companies under reorganization, which is a cause for suspending the enforceability of the tax, pursuant to article 151, subsection VI, of the CTN. 3. The tax installment plan is a right of the company under judicial reorganization that leads to a situation of good tax standing, such that any non-compliance with the provisions of article 57 of the LRF can only be attributed, at least immediately and for the time being, to the absence of specific legislation regulating the installment plan in the context of a judicial reorganization, not constituting a burden for the taxpayer, when the legislator is silent, to presentation of certificates of good tax standing in order to be granted reorganization. 4. Special appeal not granted relief. (Special Appeal 1187404/MT, opinion drafted by Justice Luis Felipe Salomão, Special Court, decided on June 19, 2013, published in the electronic gazette of the judiciary on August 21, 2013).

^[6] Article 47 of Law 11,101/05.

^[7] Article 10 of Law 10,522/02 establishes the "general" installment payment of debts of any nature with the National Treasury, under the following conditions (less beneficial than the "special installment payment for the judicial reorganization context": within up to 60 monthly installments, according to the wording of Law 10,637/02.

^[8]Special Appeal 1864625/SP, opinion drafted by Justice Nancy Andrighi, Third Panel, decided on June 23, 2020, published in the official gazette of the judiciary on June 26, 2020.

^[9] Law 11,101/05. Article 6, paragraph 7. Tax foreclosures are not suspended by the granting of judicial reorganization, except in the case of payment in installments, pursuant to the National Tax Code and specific ordinary legislation. (Repealed by Law 14,112/20)

National Tax Code. Article 186. The tax debt takes precedence over any other, regardless of its nature or the time of its formation, with the exception of debt claims resulting from labor legislation or occupational accidents. (As amended by Lcp No. 118, of 2005); Article 187. Judicial collection of the tax debt is not subject to a creditors' list or registration in bankruptcy, judicial reorganization, scheme of arrangement, inventory, or probate. (As amended by Lcp No. 118, of 2005)

Tax Foreclosure Law. Article 5. The competence to try and decide the execution of the Public Treasury's Outstanding Debt excludes that of any other court, including bankruptcy, scheme of arrangement, liquidation, insolvency, or inventory; Article 29. Judicial collection of the Public Treasury's Outstanding Debt is not subject to a creditors' list or registration in bankruptcy, scheme of arrangement, liquidation, inventory, or probate.

^[10]Special Appeal 1673421/RS, opinion drafted by Justice Herman Benjamin, Second Panel, decided on October 17, 2017, published in the electronic gazette of the judiciary on October 23, 2017.

^[11] Theory No. 08, of the 37th edition of Jurisprudence in Theories of the STJ.AgRg in CC 136.130/SP, reporting judge Justice Raul Araújo, opinion drafted by Justice Antonio Carlos Ferreira, Second Section, decided on May 13, 2015, published in the electronic gazette of the judiciary on June 22, 2015, and others.

^[12] Special Appeal 1694261/SP, Special Appeal 1694316/SP, Special Appeal 1712484/SP, Special Appeal 1757145/RJ, Special Appeal 1760907/RJ, Special Appeal 1765854/RJ, Special Appeal 1768324/RJ.

^[13]CC 153.998/DF, Reporting Justice Laurita Vaz, opinion drafted by Justice Nancy Andrighi, Special Court, decided on December 18, 2019, published in the electronic gazette of the judiciary on September 22, 2020.

^[14] Special Appeal 1694261/SP, opinion drafted by Justice Mauro Campbell Marques, First Section, decided on June 23, 2021, published in the Electronic Gazette of the Judiciary on June 28, 2021.

^[15]RFB/PGFN Joint Ordinance No. 895, of May 15, 2019, and PGFN Ordinance No. 2382, of February 26, 2021.

^[16] Code of Civil Procedure, article 190. When the lawsuit deals with rights that admit settlement, it is lawful for fully capable parties to stipulate changes in the procedure to adjust it to the specifics of the case and to agree on their procedural burdens, powers, faculties, and duties, before or during the lawsuit.

^[17] Article 19, paragraph 13. Without prejudice to the provisions of paragraph 12 of this article, the Attorney General's Office for the National Treasury will regulate the execution of procedural legal settlements within its scope of action, including in the administrative or judicial collection of outstanding federal debt. (Included by Law No. 13,874, of 2019)

^[18] Case No. 2215483-23.2021.8.26.0000, decision dated September 24, 2021: judicial reorganization of Ponto Final Participações e Empreendimentos Ltda.

^[19] Case No. 248841-13.2020.8.26.0000, decided on August 10, 2021.

^[20] Case No. 5046520-86.2021.8.13.0024, in progress before the 2nd Business Court of the Judicial District of Belo Horizonte/MG. The petition referred to is ID 4055338020.

^[21] As per ID 4139833018 – Decision.

^[22] As per ID 4555558026 – Petition and 4573277993 – Petition.

^[23] As per ID 4795738014 – Decision.

^[24] Judgment handed down on July 27, 2020 - pp. 35,809-35,847.

^[25] On January 22, 2021, March 1, 2021, and July 19, 2021.

^[26] Case No. 0046087-14.2020.8.19.0000, decided on April 6, 2021.

^[27] Complaint No. 43.169 MC/SP, decided on September 4, 2020.

^[28] On December 3, 2020, under the understanding that the dispute has infra-constitutional nature, the constitutional complaint was denied.

^[29] Argument of Unconstitutionality No. 0048778-19.2019.8.16.0000.

Category: Real estate

The Superior Court of Justice (STJ), in a recent decision and unanimously, recognized the suitability of claims of ownership (usucapio) related to private properties  without real estate registration. This was the understanding of the ministers, when they judged a claim of ownership related to a property located in a land subdivision established for years in the Planaltina-DF, but not authorized or regularized by the local Public Administration.^[1]

The issue  brought for consideration by the Supreme Court originated in hundreds of cases of usucapio in progress before the Court of Justice of the Federal District involving private properties devoid of their own enrollment certificates, inserted in land subdivisions legally classified as clandestine, which were not authorized or regularized by the administration of the Federal District, although they have existed for decades. The decision also consolidates previous decisions of lower courts with the same understanding.

The usucapio is a constitutionally guaranteed institute. It allows the acquisition of real estate property by proving the possession exercised without opposition and for a certain time, in addition to other requirements required by law. Because it is an original form of acquisition of property, there is no transfer of liens or encumbrances on the real estate property for the plaintiff (the usucapiente). The registration of the usucapio on the enrollment certificate, therefore, is not done to constitute the acquisition, but rather to give publicity to it and allow the exercise of the right to dispose of the property, in addition to regularizing the registry itself.^[2]

In the case, for the judge of origin, the usucapio is a form of acquisition of the property that may be declared regardless of the prior existence of registration or enrollment certificate.

On the other hand, the Public Prosecutor's Office of the Federal District and the government of the Federal District itself defend the thesis of impossibility of declaring property through usucapio of properties in this condition, under penalty of usurping the administration's urban planning and regularization function.

It seems reasonable to argue that, in the case of the subdivision located in the Federal District, the absence of real estate registration should not really derail the favorable decision in usucapio. This is because the objective of the legal standard – provided that the presence of all legal requirements is demonstrated – is exactly to regularize, in legal and register terms, a consolidated fact. The lawsuit promotes, finally, legal certainty in real estate transactions, for the benefit of the less favored population.

In the case analyzed, there is the perfect individualization of the property, served by infrastructure and equipment that enable the development of civil and social life, characterizing the property as belonging to an absolutely established nucleus, with difficult (or impossible) reversal.

It should be emphasized that the integration of consolidated informal nuclei and non-regular areas to the urban territorial planning, with the delivery of titles to their effective occupants seems to be the general objective of the country's land policies. This can be proven by the current legislation, which does not require prior registration as a presupposition of usucapio.

In this sense, the Decision of the Supreme Court represents, in addition to a legal solution for a recurrent claim, a huge advance. It confirms the feasibility of regularizing irregular and vulnerable areas (both socially and economically), which suffer from significant land problems, demonstrating that it is possible to apply fast solutions and guarantee the fundamental right to housing.

^[1] Special Feature 1,818,564 - DF

^[2] Resp. 118360/11