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                Bankruptcy Law in Brazil is a strong strategic key for the benefit and relief of creditors. Any person or juridical entity engaged in business or trade may be able to claim or be claimed for bankruptcy state. However, in order to claim the bankruptcy proceeding this person, without legal right, must fail to pay its obligation (debt) which some requirements are mandatory.

                This legal "weapon" is commonly used by lawyers to force the debtor to pay, specially against companies. Statistics shows that 90% of this legal strategic does not ends on court. Usually, the debtor pays it to avoid the sue and only few cases are not against juridical entities.

                Most of International Trade debts are able to claim this proceedings.

                In this proceeding, once the bankruptcy is claimed, the judgment debtor is summoned to present its defense in 24 hours, pay the debt or show a list of its states. If the obligation is not paid the Court will judge its bankruptcy state and the bankruptcy proceedings will begin and will touch all its property.

                The documents that are able to claim this legal weapon are as follows:

• local judgment, conciliation and arbitration awards;

• foreign judgment, conciliation and arbitration awards if confirmed by STF (Federal Supreme Court);

• drafts;

• bill of exchange;

• promissory notes;

• duplicates (invoice double issued);

• debentures;

• checks;

• contracts;

• warrants;

• credit cards;

• mortgage;

• bond;

• insurance policy.

Copyright © 1999 -Revised 10/10/2000

Zulian Advogados Associados

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