As informed in our previous post, Provisional Measure 881, already known as "MP of Economic Freedom", was signed on 30.04.last.
In addition to the general principles of economic freedom already commented in our previous text, the MP introduced specific amendments to certain laws.
Today we highlight the provisions relating to the liability of partners and managers of companies.
Firstly, the MP amends article 50 of the Civil Code, which deals with the disregard of the legal entity, that is, the cases in which the personal assets of partners and administrators are liable for the company's debts.
From now on, for a partner or manager to be held liable, he or she must have directly or indirectly benefited from the abuse that gave rise to the liability.
A company's purpose will only be deviated if its malicious use is proven with the specific purpose of harming creditors or practicing illegal acts. The mere expansion or alteration of the original purpose of the company's activity shall not constitute deviation of purpose.
Furthermore, the mere existence of an economic group does not authorize the disregard of the company's personality.
The Bankruptcy Law (Law 11101) was also amended to determine that the effects of bankruptcy will only apply to partners and senior managers when the requirements for disregard of legal entity set out in article 50 of the Civil Code, commented above, are present.
Specifically in relation to EIRELI (Limited Liability Sole Proprietorship), a paragraph was added emphasizing the limitation of liability of the holder, who will only be liable for the debts of the EIRELI in case of fraud.
Finally, the incorporation of a single partner limited liability company is now allowed, after decades of requiring a plurality of partners.
Other impacts of the MP will be commented on in the following posts.
The Corporate Law team of Barcellos Tucunduva Advogados, headed by partner Ricardo dos Santos de Almeida Vieira, is available for any advice or clarification on the subject.
