Vol 19 (2022) - Issue 4

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Alternative Plans of Reorganisation Proposed by Creditors in Brazilian Insolvency Law

Synopsis
The possibility of creditors approving a reorganisation plan without the consent of the debtor is one of the key changes introduced in December 2020 when a general reform was enacted to overhaul Law 11,101 of 2005, the piece of legislation regulating corporate insolvencies in Brazil. This shift addresses one of the inadequacies of the previous legislation – the legal requirement that any plan of reorganisation could only be proposed by the debtor and that any amendment should have its consent.
In this article, we provide an overview of the mechanics of the alternative plan – including the procedure and requirements for filing and obtaining approval and court confirmation – and how it aims to improve over previous legislation.