Special Opportunities

Court-Ordered Government Debt Claims (Precatórios) and Receivables

Court-ordered government debt claims (precatórios) currently represent an outstanding balance exceeding BRL 300 billion in Brazil, encompassing the Federal Government, states, municipalities, and the Federal District. Constitutional Amendment No. 136/2025 (August 2025) introduced significant changes, including reduced budget allocations by debtor entities, increased claim inventories and extended payment terms, as well as the replacement of the monetary adjustment index (from SELIC, Brazil’s benchmark interest rate, to IPCA + 2% p.a.). This scenario increases the availability of such credits and requires in-depth technical analysis to ensure secure transactions.

LBZ’s Role

LBZ advises individuals, legal entities, securitization companies, and FIDCs (Brazilian Credit Rights Investment Funds), with a focus on public receivables and federal, state, and municipal precatórios. These assets, classified as distressed assets, require legal expertise for the assessment of debtor solvency, expected settlement timelines, and accurate pricing, particularly in light of recent legislative changes.

LBZ’s team includes a highly qualified technical and legal staff prepared to identify the most suitable market niche according to each client’s investment profile and to validate transactions, seeking security, agility, liquidity, and the highest possible return.

Services Provided

With a track record of more than 700 credit assignment transactions and over BRL 500 million transacted, generating returns ranging from 30% to 200% p.a. per claim, we operate in an integrated manner by offering

• Strategic Advisory: Analysis of debtor entities (CAPAG – Brazil’s public-sector payment capacity rating), budgetary track record, outstanding liabilities, net current revenue, and local legislation regarding direct settlement agreements. Evaluation of IRR and liquidity.
• Technical Analysis and Structuring: Full due diligence of claims and creditors, updated calculations, risk reports, and drafting of credit assignment agreements.
• Legal Formalization: Filing of court approvals, preparation of documentation for FIDCs, and support throughout the validation process.
• Procedural Monitoring: Representation before Court-Ordered Payment Coordination Offices and original trial courts, with continuous monitoring through settlement and direct agreement notices.
• Amount Verification: Review of payment calculations, including identification of discrepancies.
• Residual Recovery: Administrative and judicial recovery of outstanding differences identified.

Competitive Advantages:

• Regional market mapping aligned with the investor’s risk profile.
• Advisory services for direct settlements and priority payment (superpreferência) claims.
• Challenges to court-approved calculations containing errors.
• Full advisory support in precatório transactions.