Credit recovery in Brazil is about to receive a significant technological boost. The Brazilian National Council of Justice (CNJ) has begun implementing the new SISBAJUD Manual, the system used by the Judiciary to locate and freeze debtors’ financial assets.
The changes are currently being tested in a pilot project involving major financial institutions and are expected to be gradually rolled out across the entire Brazilian banking system.
The main innovation is the significant reduction in the time between the issuance of a court order and the effective freezing of funds, which may now occur on the same business day. This development is expected to increase the effectiveness of enforcement proceedings and judgment enforcement actions, reducing opportunities for asset concealment and improving creditors’ recovery prospects.
In this context, we highlight 5 key benefits for creditors.
1. Faster asset freezes and greater chances of locating funds: With court orders being transmitted to financial institutions twice a day, asset freezes may be carried out within a matter of hours. In practice, this significantly reduces the gap between the judicial decision and the effective attachment of assets, minimizing the risk of transfers or withdrawals made after the debtor becomes aware of the enforcement proceeding.
2. Reduced opportunities for asset concealment: One of the main challenges in enforcement proceedings is the rapid movement of funds by debtors seeking to avoid asset restraints. With SISBAJUD’s enhanced operational speed, it becomes considerably more difficult to empty accounts or reorganize assets after a court order has been issued, increasing the effectiveness of enforcement measures.
3. Asset freeze orders may remain active for up to one year: Under the new model, freezing orders may remain in effect for up to twelve months. As a result, funds deposited into a debtor’s accounts in the future may also be captured by the order, reducing the need for repeated requests and increasing the likelihood of satisfying outstanding claims.
4. More information to support recovery strategies: Financial institutions will provide more detailed responses to the Judiciary, increasing transparency regarding compliance with court orders. The enhanced flow of information may assist creditors and their counsel in developing asset recovery strategies and identifying additional enforcement measures.
5. Greater effectiveness of enforcement proceedings: The modernization of SISBAJUD reinforces a broader trend toward the use of technology to improve the effectiveness of judicial enforcement. For creditors, this means increased recovery prospects, shorter asset-tracing efforts, and greater predictability regarding the outcome of enforcement proceedings.
The implementation of the new SISBAJUD represents an important step forward for credit recovery in Brazil. By combining automation, speed, and greater integration between the Judiciary and the financial system, the platform is expected to strengthen the effectiveness of enforcement proceedings and reduce many of the obstacles traditionally faced by creditors when locating and attaching financial assets.
