Regardless of authorization from the competent court, companies in judicial recovery may enter into factoring contracts in the course of the recovery proceedings.
Based on this understanding, the Third Panel of the Superior Court of Justice (STJ) granted the appeal of three companies in recovery to reverse a ruling of the Court of Justice of São Paulo and remove the restriction imposed on them regarding the entering into of commercial financing (factoring) contracts.
Read also:
Relevance of Contracts – Survival of the Business
The rapporteur, Justice Nancy Andrighi, explained that the corporate affairs of companies in judicial recovery remain managed by them during the recovery proceedings, except where one of the legally provided grounds for removal or dismissal is verified.
According to the justice, Article 66 of the Bankruptcy and Corporate Recovery Law (Law No. 11,101/2005) imposes on the debtor certain restrictions regarding the practice of acts of alienation or encumbrance of assets or rights of its permanent assets, after the request for recovery.
Assets alienated as a result of factoring contracts
Nancy Andrighi pointed out that the assets alienated as a result of factoring contracts (credit rights) do not form part of any of the subgroups that make up the permanent assets of the company, since they cannot be classified in the categories of investments, fixed assets, or deferred assets.
“Thus, whether the credit rights (depending on their maturity) are classified as current assets or as long-term realizable assets, the fact is that, since such items cannot be classified in the permanent assets category, the restriction on the entering into of factoring contracts by a company in judicial recovery is not covered by the normative command of Article 66 of the LFRE,” she emphasized.
For the rapporteur, commercial financing (factoring) contracts, insofar as they provide a substantial reinforcement in obtaining working capital (assisting as a liquidity factor), can serve as important allies of companies seeking to overcome a situation of economic-financial crisis.
Source: STJ
← Back to blog