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Guidance Advice in Acquire and Sale of Precatory

Do you know how the investment in predatory works?

Our Solution

Precatory is the judicial recognition of a debt that a public household has with the plaintiff of an action. These types of credit rights are guaranteed by Article 100 of the Federal Constitution and can be divided into two main categories:

FOOD
Food precatories are mainly composed of credits of public servants due to lawsuits related to: salaries, pensions, retirements or indemnities for death, for example.

NON-FOOD
Non-food, on the other hand, are usually credits of private sector employees against government authorities due, mainly, to expropriation of land or collection of improper taxes.

HOW TO INVEST IN PRECATÓRIOS WITH ASSERTIVENESS AND SAFETY
Access to investment in precatories can only be done through highly specialized offices. As this is a highly complex market, several issues need to be examined before investing:

THE RISKS AND THEIR MITIGATIONS

Investments in precatories commonly concentrate a high rate of return, because in addition to the discount of the purchase, they are updated by crystal clear and well-defined rules. However, due to their nature being different from the others in the financial market, investors need to keep in mind the following risks and their mitigations:

Standard Risk

Payment Deadline

Legal Risk

Coin

The payment of the precatórios is protected by Article 100 of the Federal Constitution, which already mitigates the risks of investment in an assertive way. There's no possibility of negligence.

HIGH RATES OF RETURN
The precatórios are adjusted each year by 6% as interest on late payment, plus the adjustment for inflation on the value of the credit.

MAJOR MARKET PLAYERS

  • Investment Funds (FIDCs – Credit Rights Investment Fund), including onshore and offshore investors;
  • Local and foreign banks;
  • Companies that use precatórios for tax compensation, i.e. Value Added Tax (VAT) and Income Tax (IR).

MARKET SIZE

  • It is estimated that the stock of predators in Brazil, including municipal, state and federal debts, is US$ 30 billion;
  • According to the government of São Paulo, debts issued in precatórios of approximately US$ 13 billion, half of which are of a food nature.
  • It is also evident that the law allows any legal entity to use precatórios to pay debts to the public entity, so you entrepreneur who wants to pay off their tax debts before the Union, State or Municipality, reducing the value of debt, generating economic results, balancing their cash flow, A.R. Inteligência de Mercado has the solution to the right extent for your company.
  • Our multidisciplinary team of specialists is prepared to present you with precatories available in the market with security and assertiveness, to offset your tax debts with discount, before the public, and can also advised in the planning to improve your cash flow for the coming years.

Check out how to sell or buy your predator with advantages safely and assertively with the A. R. Inteligência de Mercado. Contact us and talk to our multidisciplinary team.

 

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