When a client or borrower files for judicial reorganization, the creditor usually discovers that the quality of its position was decided long before the proceedings: at the contract signing table. Some claims go on the list, wait for the plan, and absorb haircuts and ten-year payment terms. Others simply never enter this waiting list.
The key lies in Article 49, §3, of Law No. 11,101/2005. The provision removes from the effects of judicial reorganization any creditor holding the position of fiduciary owner of movable or immovable property, lessor under a finance lease, owner or seller under a real estate sale agreement containing an irrevocability or irreversibility clause, including in real estate developments, and owner under a sale agreement with retention of title. For all of them, “the property rights over the asset and the contractual terms shall prevail.” The logic is simple and powerful: an owner is not a creditor in the proceedings. It does not file a claim, does not vote, and is not bound by the plan – it reclaims what is its own.
There is a single limit, set out at the end of that same paragraph: during the stay period, the sale or removal from the debtor’s business premises of capital assets essential to its business activity is not permitted. That is where virtually all of the litigation is concentrated.
This is no longer a matter of legal refinement. With Brazil recording the largest number of companies under judicial reorganization in its historical series – 2,466 companies in 2025, across 977 proceedings, up 13% from 2024, according to Serasa Experian – the choice of contractual structure has become a credit risk management tool.
Below are 3 contractual structures that keep the creditor outside the proceedings, and what recent case law requires of each one:
1. Sale with Retention of Title – the Supplier That Remains the Owner: Governed by Articles 521 to 528 of the Brazilian Civil Code, this structure applies to the installment sale of movable property capable of perfect identification, so as to distinguish it from other assets of the same kind (Article 523): the buyer receives immediate possession and use, but title transfers only upon payment of the final installment. In the buyer’s judicial reorganization, the seller is not a creditor under the plan – it is the owner, and its claim sits outside the proceedings. The STJ has rejected the objection most frequently raised by debtors: in Special Appeal No. 1,725,609/RS (3rd Panel, Rep. Justice Nancy Andrighi, judged on August 20, 2019), it held that claims arising from a sale agreement with retention of title are not subject to the buyer’s judicial reorganization regardless of whether the agreement is registered with a notary office, since registration serves publicity and enforceability against third parties, not the creation of the seller’s right. In practice, this is the only mechanism on this list available to any seller – manufacturer, distributor, equipment supplier – with no need for a financial institution in the structure. The same ownership logic protects the finance lease, also listed in Article 49, §3, with two relevant differences: it is an activity restricted to leasing companies and to multiple-service banks with a leasing portfolio, all authorized by the Central Bank of Brazil (Law No. 6,099/1974 and CMN Resolution No. 4,977/2021) and, in the sale-leaseback format, it allows the debtor to monetize an asset it already owns. Points of attention for the creditor: a written agreement, precise identification of the asset, formal constitution of default through protest or judicial notice (Article 525 of the Civil Code), and recovery of the asset through possessory remedies rather than claim filing.
2. Fiduciary Sale of Assets as Collateral – the Security That Stays Out of the Plan: In a fiduciary sale as collateral (alienação fiduciária em garantia), the debtor transfers revocable title over the asset to the creditor and retains direct possession. The creditor is the fiduciary owner – the most frequently invoked hypothesis under Article 49, §3 – and its claim sits outside the proceedings, whether the collateral is movable property (Decree-Law No. 911/1969 and Article 66-B of Law No. 4,728/1965) or real estate (Law No. 9,514/1997). The STJ has already established that the protection applies even when the asset transferred as collateral belongs to a third party, that is, when the grantor is not the company under reorganization (Special Appeal No. 1,938,706/SP, 3rd Panel, Rep. Justice Nancy Andrighi, judged on September 14, 2021). Law No. 14,711/2023 (the Legal Framework for Collateral) expanded the instrument by allowing the fiduciary sale of subsequently acquired property (Article 22, §3, of Law No. 9,514/1997) and by extending the out-of-court enforcement procedure to mortgage-secured claims. The sensitive point is essentiality. In Special Appeal No. 1,758,746/GO (3rd Panel, Rep. Justice Marco Aurélio Bellizze, judged on September 25, 2018), the STJ defined a capital asset as a tangible asset, movable or immovable, in the debtor’s direct possession, neither perishable nor consumable, employed in the production process – a definition that delimits what may be retained during the stay period. In 2026, the debate moved one step further: consolidation of ownership. The STJ has held that, where the asset is essential, fiduciary ownership does not consolidate in the creditor’s favor during the stay period (Internal Appeal in Special Appeal No. 2,896,462/MT, Rep. Justice Ricardo Villas Bôas Cueva, 3rd Panel, 2025, in line with Special Appeals Nos. 2,068,119/SC and 2,022,380/PR), while the Mato Grosso Court of Appeals has opened a line distinguishing ownership from possession – allowing consolidation while barring physical removal of the asset. This remains an open controversy and should be factored into collateral pricing and into the design of contractual remedies.
3. Fiduciary Assignment of Receivables and Escrow Accounts – Shielding the Cash Flow: This is the most widely used structure in Brazilian structured credit, and the one that protects precisely what the creditor most fears losing: cash flow. Under a fiduciary assignment (Article 66-B, §3, of Law No. 4,728/1965), the creditor becomes the fiduciary holder of the debtor’s credit rights; combined with a segregated (escrow) account, the receivable is settled into a controlled account without passing through the company’s free cash. Case law is settled on three fronts. First: in Special Appeal No. 1,629,470/MS, the STJ’s Second Section (Rep. Justice Maria Isabel Gallotti, judged on November 30, 2021) excluded from the effects of judicial reorganization receivables assigned on a fiduciary basis as collateral for bank credit notes. Second: assigned credits are not capital assets and are therefore not caught by the restriction at the end of Article 49, §3. Third: the security interest is created by the contract itself, not by registration (Special Appeals Nos. 1,412,529/SP and 1,559,457/MT, 3rd Panel, December 2015), although registration remains advisable for enforceability against third parties. More recently, the 4th Panel reinforced this position by holding that, once the stay period has ended, the reorganization court may not block the attachment of a claim standing outside the proceedings on the grounds of preserving the business, because what is at stake is not capital but cash claims granted as fiduciary collateral (Special Appeal No. 1,994,200/SC, Rep. Justice Maria Isabel Gallotti, judged on December 1, 2025). Points of attention: identification of the assigned credits, treatment of future and unperformed receivables, portfolio reinforcement and substitution mechanisms, and the design of the escrow account. A more radical alternative is the outright assignment (true sale) to a receivables investment fund (FIDC) or securitization company, which removes the asset from the assignor’s estate – but co-obligation, mandatory repurchase, and substantial retention of risk feed the recharacterization of the transaction as secured financing, in addition to exposure under Articles 129 and 130 of Law No. 11,101/2005.
The common denominator across the three structures is the same: the shield does not come from the debtor’s credit quality or from negotiating the plan, it comes from ownership. Those who reach a judicial reorganization as owners argue about possession and essentiality; those who arrive as ordinary creditors argue about haircuts and payment terms. In a scenario of record judicial reorganizations, this shifts the legal work to the origination of the transaction: contract drafting, registration, and collateral architecture are worth more than any subsequent litigation.
