Banckruptcy and Lease under Brazilian Banckruptcy Law

Adriana Valéria Pugliesi

Keywords

Banckruptcy; Lease; Brazilian Banckrupcy Law; Preservation of the company.

Abstract

Bankruptcy instituted by Federal Law n. 11101/05 has fully renovated purposes in the current Brazilian bankruptcy law. Next to the credit protection— vector that always guided a Bankruptcy procedure — is also the principle of preservation of the companyas one of its pillars. The preservation of the company will be achieved under the implementation of legal mechanisms aimed to maintain the economic activity pre-existing and by transferring it to another economic agent who is able to exploit it efficienttly. The creditor’s claims, on the other hand, will be preserved and potentially will be better served because it is assumed that the disposal of a business in progress will provide best results. The section 114 of Federal Law 11101/05 provides permission to lease the assets of the estate and this is an important mechanism of company preservation.