Case 123 Miles: understand what happens now

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Travel agency filed for bankruptcy this Tuesday (29), stating that the measure is essential for it to be able to honor commitments with customers, former employees and suppliers. Travel agency 123 Milhas suspends packages and issuance of promotional tickets. Reproduction ” The 123 Milhas travel agency filed a request for judicial recovery last Tuesday (29), at the 1st Corporate Court of the District of Belo Horizonte, in Minas Gerais. The decision comes less than two weeks after the company suspended the packages and the issuance of tickets for its promotional line (with flexible dates). According to the company’s lawyers, the request was filed due to “internal and external” factors, which “imposed a considerable increase in its liabilities in recent years”. The measure, according to the company, aims to “ensure compliance with the commitments assumed with customers, former employees and suppliers”, and should allow the company to reach solutions with creditors faster and manage to “rebalance its financial situation” (see the complete positioning of 123 Milhas at the end of this article) Case 123 Milhas: understand what happened and why the company filed for judicial recovery What happens now? According to experts interviewed by g1, once the request has been filed, there are two paths that may arise: The granting (acceptance) of the company’s request for judicial recovery; or Appointment of an expert to make the preliminary finding (understand below). If there is a need to appoint an expert for prior verification: According to BBMO Advogados partner Rodrigo de Oliveira Spinelli, the decision to appoint an expert may be made if the judge responsible for the case understands that the cause is “very complex”. “If the magistrate appoints an expert, he will be responsible for analyzing the documentation and the reality of these companies that entered into judicial recovery. This professional will assess the situation and give an opinion saying whether or not the companies meet the requirements for recovery”, explains the expert. If the request for judicial reorganization is granted: If the request is accepted by the responsible judge, on the other hand, the procedures are different. According to the specialist in corporate restructuring and lawyer at Luchesi Advogados Camila Crespi, there will be: The suspension of the statute of limitations for the debtor’s obligations; The suspension of all actions and executions filed against 123 Milhas; and Prohibition of any form of retention, attachment, attachment, search and seizure, or even judicial constriction against the company. According to the lawyer, this prohibition happens because the judicial recovery provides the company with the opportunity to renegotiate its debts with its creditors, “in order to preserve the business activity and the social function (job generation, circulation of goods and wealth, collection of taxes and etc)”. Spinelli, from BBMO Advogados reiterates that the request filed by 123 Milhas also contains an injunction in which the company requests that the period of asset shielding, also known as “stay period”, be brought forward. During this period, which can last from 180 to 360 days, all actions and executions against the company are suspended, protecting it from collection by creditors. Finally, if 123 Milhas meets all the requirements for its request to be accepted by the judge in charge, the company will have about two months to present a judicial recovery plan, containing everything it intends to do to pay off its debts and get back on its feet . Understand what judicial recovery is and how it works How long does it take for the Judiciary to make a decision on the request for judicial recovery? According to the lawyers consulted by g1, the Judicial Recovery and Bankruptcy Law does not stipulate a minimum or maximum term for the Judiciary. “Usually, due to the urgency, this decision can come out in a matter of days or even a week. But it’s all very relative”, says Spinelli. According to Serur Advogados lawyer Tiago Cisneiros Barbosa de Araújo, this first decision, however, is just a “kind of authorization for the judicial reorganization to continue”. “In a second moment, when the company presents the recovery plan, the creditors will be able to express themselves about it, including in a general meeting, which can be in person or virtual”, says the lawyer. He reiterates that the law requires some quorums for approval by creditors and that, if this is met and if there are no illegalities, the judge will issue the decision to homologate the plan, which grants the judicial recovery itself. From that moment on, explains Araújo, the company will need to comply with what was established in the plan and previous debts are replaced by obligations that were agreed upon and accepted by creditors and the Judiciary. “This second decision, granting judicial recovery, usually takes much longer, depending on the complexity of the process and the pace of the court where it is processed. It can be handed down in about six months, but sometimes it takes a few years”, completes Araújo . Is the company at risk of bankruptcy? According to experts, although it is still too early to make this analysis, since the process is still in its initial phase, the risk of bankruptcy exists. “Once the company enters with the recovery and, being present the requirements for it to be converted [decretada] judicial recovery in bankruptcy, there are risks, yes. But, due to the case’s notoriety and, mainly, the company’s need for asset protection, at this first moment, bankruptcy is not the most concrete hypothesis”, says Crespi, from Luchesi Advogados. bankruptcy can occur, for example, if there is rejection by creditors or if the company fails to comply with what was agreed in the plan. “This, however, varies greatly from case to case, including because there are flexibility points in legislation and jurisprudence”, says Araújo, from Serur Advogados. How are the employees recently fired by 123 Milhas? Recently, employees at 123 Milhas reported to g1 that there were hundreds of layoffs in various sectors of the company. fired up to the date of the request for judicial recovery are included as labor creditors. “[Caso os funcionários ainda tenham valores a receber da 123 Milhas] these credits will be subject to the effects of the judicial reorganization and will be paid in accordance with the plan, if it is approved”, explains Araújo, noting that it is possible that these workers receive their funds with a discount and in a longer term. “On the other hand, the specific law assures labor creditors that the discharge of credits must occur, as a rule, within one year of the decision granting judicial recovery. For other classes of creditors, there is no such time limitation”, completes the lawyer. What does 123 Milhas say? with the objective of “ensure compliance with the commitments assumed with customers, former employees and suppliers.” See the note in full: “123milhas informs that today (29/08) filed a request for Judicial Reorganization at the Court of Justice of Minas Gerais. The measure aims to ensure compliance with the commitments assumed with customers, former employees and suppliers. The Judicial Reorganization will allow to concentrate in a single court all the amounts owed. The company believes that, in this way, it will reach solutions with all the creditors more quickly in order to progressively rebalance its financial situation. 123milhas points out that it continues to provide data, information and clarifications to the competent authorities whenever requested. The company and its managers are available, in line with their commitments to transparency and ethics, to jointly build measures that make it possible to pay their debts, rebuild their revenue and, thus, continue to contribute to the Brazilian tourism sector.” 123 Miles: See consumer rights

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