German company F. Laeisz demands payment of dividends from shares of the former Brahma brewery blocked by Vargas decree
A dispute that began with a ruling issued in 1942 by the then president during the Second World War could force the company to pay around R$260 million in dividends on shares in the former Cervejaria Brahma.
The case involves shares that belonged to the German company F. Laeisz and were affected by measures adopted by the Brazilian government against German, Italian and Japanese assets. More than 80 years later, the Court is still discussing whether these papers were simply blocked or passed into the Union’s assets.
The topic will be decided by the STJ (Superior Court of Justice) no special resource . The trial had been scheduled for June 16, but the rapporteur, minister, asked for the case to be removed from the agenda. The new trial date has not yet been set.
F. Laeisz claims that it continued to own the shares in the former Cervejaria Brahma and, therefore, is entitled to the dividends. The Union says that the papers were incorporated into public assets or that the German company missed the deadline to request restitution. Ambev keeps the amounts retained until the courts decide who is entitled to the money.
ORIGIN IN WAR
Brazil tried to remain neutral in the Second World War, but broke diplomatic relations with the Axis – made up of Germany, Italy and Japan – in January 1942.
From that year onwards, Brazilian ships became the target of attacks. German and Italian submarines sank Brazilian merchant vessels and caused more than a thousand deaths.
The decisive episode came in August 1942, when the German submarine U-507 attacked Brazilian vessels off the coast of Sergipe and Bahia, causing hundreds of deaths and increasing pressure for Brazil’s entry into the conflict.
The attacks brought the population to the streets and pressured the Vargas government to declare war on Germany and Italy. Brazil would become the only country in Latin America to send troops to fight in Europe.
VARGAS DECREE
It was in this context that the decree that gave rise to the dispute emerged. Published on March 11, 1942, the text ordered the blocking of German, Italian and Japanese assets in Brazil to guarantee future compensation for the losses caused by the war.
The decree expressly cited the attack on the merchant ship Taubaté, which was machine-gunned by a German plane in the Mediterranean Sea. The episode killed crew member José Francisco Fraga, remembered as the first Brazilian killed in the conflict, and injured 13 other people.
The blockade of goods was part of a broader offensive by the Estado Novo. The government banned the public use of German and Italian, closed schools and foreign-language newspapers and took measures against companies and citizens linked to the Axis countries.
After the sinkings of Brazilian ships, tension also reached the streets. Immigrant businesses were vandalized in different cities across the country.
GERMAN ROOTS OF BRAHMA
F. Laeisz is a German company founded in Hamburg in the 19th century and known for its tradition in maritime transport. The company became famous for its “Flying P-Liners”large cargo sailing ships named with names starting with the letter P.
In Brazil, F. Laeisz transported inputs used in beer production. Still at the beginning of the 20th century, he became a shareholder in Brahma.
Brahma itself, founded in 1888 and which would later give rise to Ambev, had a strong presence of German capital in its origins. In shareholder lists from the 1930s and 1940s, F. Laeisz and another German company, Theodor Wille & Cia., appeared among the largest investors.
During the Second World War, this shareholding composition began to weigh against the brewery. The company was included in “black lists” maintained by the United States and the United Kingdom with the names of companies suspected of links to the Axis.
Brahma left these lists in 1943, after diplomatic coordination. But it was because of the German origin of the shares that F. Laeisz’s lot ended up being affected by Vargas’ decree.
BLOCKAGE OR TRANSFER TO THE UNION
More than 80 years later, the Court is still trying to define the effect of Vargas’ decree on the actions of the former Brahma, today part of the capital of Ambev.
For F. Laeisz, the papers were merely blocked as collateral. According to this reading, ownership of the shares never ceased to belong to the German company, which would be entitled to the dividends generated over the years.
For the Union, the shares were incorporated into public assets. The government also maintains that the company missed the deadline to claim the shares and that public goods cannot be acquired by individuals simply due to the passage of time.
The dispute went back and forth. In 1975, the STF (Supreme Federal Court) recognized, in extraordinary appeal 81,834, that the transfer of 50 thousand shares to the Union had been irregular and ordered the return of the papers to F. Laeisz. Read (PDF — 903 KB).
The largest lot, of 74,211,825 shares, only returned to the center of the dispute decades later. In 2016, the National Treasury requested that these papers be transferred to the Union. F. Laeisz reacted in court and, in 2018, presented the action that has now reached the STJ.
The German company won in the first instance, in 2019, when the Federal Court of São Paulo ordered Ambev to pay the dividends. Read (PDF — 80 kB).
In the 2nd instance, however, the TRF-3 (Federal Regional Court of the 3rd Region) reformed the decision and accepted the Union’s thesis. Then, in July 2023, the 2nd Panel of the TRF-3 unanimously rejected F. Laeisz’s motion for declaration and maintained the understanding that the shares were incorporated into public assets, and not just blocked. Read (PDF — 110 kB).
It is this understanding that the German company is trying to overturn at the STJ.
When the case returns to the agenda, the 5 ministers of the 1st Panel will have to decide which thesis prevails. If F. Laeisz wins, the first instance decision may be reinstated and Ambev will have to pay dividends to the German company. If the Union wins, the understanding that the shares were incorporated into public assets prevails.
The judgment could define, in the STJ, one of the oldest disputes still related to the effects of the Second World War in Brazil, 84 years after Vargas’ decree.
