Best Restructuring & Insolvency Lawyers in São Bernardo do Campo

About Restructuring & Insolvency Law in São Bernardo do Campo, Brazil

Restructuring and insolvency law governs how businesses and individuals in São Bernardo do Campo, Brazil, manage financial distress, repay debts, and reorganize their operations to regain financial health or, in some cases, close down and distribute assets to creditors. These laws aim to provide protection and guidance to both debtors and creditors during difficult financial situations. São Bernardo do Campo, a key industrial city in São Paulo state, follows federal legislation, mainly the Brazilian Bankruptcy Law (Law No. 11.101/2005), but local courts and legal professionals play an important role in the application and interpretation of these rules. Understanding how insolvency works locally is crucial given the economic activity in the region and the specific needs of its businesses and residents.

Why You May Need a Lawyer

Seeking legal advice in restructuring and insolvency matters is important due to the complexity of the laws and the significant consequences for both businesses and individuals. Some common situations where legal help is essential include:

• Facing an overwhelming amount of debt and considering judicial recovery (recuperação judicial) or bankruptcy (falência)
• Negotiating with creditors to reach alternative payment arrangements or restructuring debt
• Dealing with creditor claims or lawsuits initiated by suppliers, banks, or employees
• Managing the protection of assets and business operations during financial difficulties
• Pursuing extrajudicial recovery (recuperação extrajudicial) as a negotiated, out-of-court solution
• Seeking to restructure business operations to avoid insolvency
• Protecting one’s rights as a creditor of a company that is insolvent or in financial distress

Local Laws Overview

In São Bernardo do Campo, restructuring and insolvency issues are mainly governed by Brazil’s National Bankruptcy and Business Recovery Law (Law No. 11.101/2005), which applies to both individuals and companies engaged in business activities. Some key features and local considerations include:

• Judicial Recovery (Recuperação Judicial): This is a court-supervised process that allows financially distressed companies to propose a debt restructuring plan, stay collection actions, and continue operations while negotiating with creditors under judicial oversight.
• Bankruptcy (Falência): When recovery is not feasible, bankruptcy proceedings involve court-ordered liquidation of assets to pay creditors according to priority established by law.
• Extrajudicial Recovery: This offers an out-of-court solution for debt renegotiation, requiring less court involvement but still demanding strict legal compliance.
• Creditors’ Rights: Creditors may participate in creditors’ meetings, vote on restructuring plans, and file claims to protect their interests.
• Local Courts: The local Commercial Courts (Vara Empresarial) in São Bernardo do Campo are responsible for handling these cases, applying the overarching federal law to local businesses.
• Labor and Tax Claims: Employee claims and certain taxes have priority status in insolvency proceedings, as established by law.

Frequently Asked Questions

What is the difference between judicial recovery and bankruptcy in Brazil?

Judicial recovery (recuperação judicial) is a court-supervised process allowing a company to restructure debts and continue operating. Bankruptcy (falência) results in the liquidation of a company’s assets to pay creditors when recovery is impossible.

Can individuals request judicial recovery or bankruptcy?

Judicial recovery is generally available to companies and entrepreneurs, not individuals. However, individuals who conduct business professionally may still be subject to bankruptcy procedures.

How long does the judicial recovery process take?

The timeline varies by case complexity but typically takes several months to years from filing to approval and implementation of the restructuring plan. Delays can occur depending on negotiations with creditors and court schedules.

What types of debts can be included in a restructuring plan?

Most business debts are eligible, except certain labor and tax debts, which may have separate legal processes or priorities. Your lawyer can review specific debts to determine their eligibility.

Are small businesses in São Bernardo do Campo eligible for restructuring?

Yes, small businesses (microempresas and empresas de pequeno porte) are eligible for judicial and extrajudicial recovery, with some simplified procedures available for these entities.

What happens to employees’ rights in insolvency proceedings?

Employees’ rights are protected by law. Unpaid wages and some labor claims have priority in the distribution of assets during insolvency.

Can creditors challenge a restructuring plan?

Yes, creditors may oppose a restructuring plan during judicial proceedings and vote in creditors’ meetings on whether to approve the proposal.

Is out-of-court settlement (extrajudicial recovery) recognized in São Bernardo do Campo?

Yes, extrajudicial recovery is available and allows for negotiated debt restructuring outside of court, but it must be formalized and homologated by the judiciary to have legal effect.

What happens to company assets during bankruptcy?

The company’s assets are liquidated and the proceeds distributed to creditors according to legal priorities. Operations usually cease unless the court allows temporary continuation for asset preservation.

Where are restructuring and insolvency cases filed in São Bernardo do Campo?

Cases are filed with the local Commercial Court (Vara Empresarial) or relevant civil courts within São Bernardo do Campo’s judicial district.

Additional Resources

If you are seeking more information or support, consider the following resources:

• São Bernardo do Campo Commercial Court (Vara Empresarial): Handles business insolvency matters locally.
• Ordem dos Advogados do Brasil (OAB) - Subseção São Bernardo do Campo: Local branch of the Brazilian Bar Association, which can refer you to experienced lawyers and provide legal guidance.
• Sebrae São Paulo: Offers business advice to entrepreneurs, including on financial restructuring and crisis management.
• Junta Comercial do Estado de São Paulo (JUCESP): The state’s business registry, essential for company documentation and procedures related to insolvency.
• Local Chambers of Commerce: Provide networking and educational resources for businesses facing financial hardship.

Next Steps

If you or your business are facing financial difficulties in São Bernardo do Campo, the following steps will guide you through the restructuring and insolvency process:

• Gather all relevant financial documents, records, and contracts.
• Contact a qualified restructuring and insolvency lawyer familiar with the local courts and laws in São Bernardo do Campo.
• Schedule a legal consultation to assess your specific situation and discuss available legal remedies.
• With your lawyer, evaluate whether judicial recovery, extrajudicial recovery, or bankruptcy is the best route for you.
• Understand your rights and obligations as a debtor or creditor before initiating any legal process.
• Follow your lawyer’s guidance closely throughout negotiation or court proceedings to ensure compliance and maximize your chances of a positive outcome.
• Seek additional support or counselling services, if needed, for business restructuring or financial planning.