V.tal, a telecommunications company controlled by BTG Pactual, filed an appeal against the recent decision of the 7th Business Court of Rio de Janeiro that culminated in Oi’s bankruptcy decree. The company is not against the bankruptcy itself, but against the implications of the decision for other stages of the process.
In V.tal’s view, the court decision adopted measures that “contradict directly” previous decisions handed down by the same court, as well as by the Civil Chamber of Private Law of the Court of Justice of Rio de Janeiro.
“The appeal presented does not aim to re-discuss the bankruptcy itself – which is already the subject of appeals from other creditors – but, rather, to preserve the extent and confidence in res judicata, as well as the stability of the insolvency system”, stated V.tal, in a note.
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The company argues that the decision of the 7th Court questions – implicitly or explicitly – a series of perfect and finished legal acts that were conceived, authorized, supervised and approved in the past by this same court and/or by the higher court.
“Such questioning occurred without provocation and without providing opportunities for contradiction, configuring a sequence of defective premises and legal improprieties”, stated V.tal.
As shown on Wednesday the 12th, the Coluna do Broadcastmore creditors were preparing to react to Oi’s bankruptcy decree. The reason for this lies in doubts about the operator’s asset sales and the agreement to end the fixed-line telephone concession raised together with the bankruptcy decree.
In recent years, the telecom has divested itself of the internet and mobile telephony businesses, fiber optic networks, fixed broadband and pay TV, as provided for in the first and second judicial recovery plans, approved by creditors and approved by the Courts. In turn, the judge of the 7th Court stated, when declaring bankruptcy, that Oi was the target of a “systemic liquidation” that practically emptied it completely.
Another target of the judge of the 7th Court was the agreement signed between Oi, the National Telecommunications Agency (Anatel), the Federal Attorney General’s Office (AGU) and the Federal Audit Court (TCU) to end the concession of fixed telephony in 2024. The judge stated that this self-composition cannot be considered an “act of State”, nor did it provide benefits for Oi.
These questions also concern V.tal, as it was the company that purchased Oi’s fiber optic networks and broadband operations, in addition to being the guarantor of the investments assumed by Oi with the end of the concession.
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“The protection of institutions such as the independence and non-succession of a UPI (Isolated Production Unit, a ‘shielded’ structure within a judicial recovery), or the validity and stability of alienations and fiduciary guarantees constituted and approved in court, goes far beyond the private interest of one of the parties”, said V.tal, in a note. “These are fundamental pillars of the entire company recovery system. Shaking these pillars would mean incalculable insecurity for future investments in companies in crisis”, he adds.
