bruno oliveira maggi
TRANSCRIPT
Bruno Oliveira Maggi KMM Advogados
LAW IN A DANGEROUS CLIMATE
BRAZIL
Current Scenario
• Political, economic and social crisis
• Instability and uncertainty
• Corruption scandals: Mensalão, Petrolão and Operação Lava-a-jato (Car Wash)
• Major public discontent
• High unemployment
• Outbreak of Zika Virus
• However…we had a great Olympic Games!
Political Crisis
• High level of corruption has tainted the highest echelons of business andpolitics in Brazil
• Since the PT (Workers' Party) came to power in 2003, there has been a series ofcorruption scandals involving politicians from the governing party and alsoopposition parties
• The second impeachment process in the history
• President Ms. Dilma Rousseff was removed on August 31, accused of breakingfiscal laws – however…not for 8 years…
• However…we now have a new President!
Economic Crisis
• Worst recession in the history
• Drop in prices for Brazilian commodities such as oil, iron ore and soya
• The economy shrank by 3,8%, its worst annual performance since 1981
• Inflation reached 10.7% at the end of last year
• The forecast for 2016 does not look any rosier with GDP expected to decline by3,8% again and inflation expected to rise
• However…the companies and investors are very excited with the newPresident, who is aligned with their expectations
Social Crisis• Unemployment increased to 9% in 2015 and economists predict it could go into double
figures in the coming months. In this April, it reached 11,2%
• Approximately 12 million people living in the favelas
• Approximately 9 million people leaving under extreme poverty conditions: no transportation,no basic sanitation, no hospital, no schools, etc., contributing to the spread of diseases.
• 91,387 cases of Zika in Brazil – divided by regions: 35,505 in Southeast; 30,286 in Northeast;17,504 in Center-West; 6,295 in North and 1,797 cases in South
• Out of 2,844 pregnant women infected by the virus in Brazil, 1,168 gave birth to babies withmicrocephaly
• However, Brazilian researchers are on of the best in the world for infections and manyfindings has been announced
Where do lawyers stand?
• Review the risks and the opportunities of the market andprovide their clients with the best information available, showingpotential investors that a period of stability is arriving.
• Show the clients other opportunities: troubled sectors (such asoil and gas, real estate, sugar and ethanol).
• Provide more information than usual in a due diligencetransaction: more details.
Where do lawyers stand?
• Guarantee the general principle of equality under the law,providing assistance to all people.
• Assure contract performance and renegotiate terms whereneeded to accommodate the parties’ concerns – in cases whereZika is invoked as a force majeure event.
