The special committee created to analyze the Proposal of Amendment to the Constitution of Precatorios (judicial payment orders) - (PECs 351/09, 395/09 and others attached) - , approved, on Tuesday (27th), the report of Deputy Eduardo Cunha (PMDB-RJ) which, among other measures, reduces from 60 to 50% the portion of the special account which may be destined to the auctions of these titles.

The other half of the account shall be applied, mandatorily, to the payment of the judicial payment orders according to the chronological order of their presentation, giving preference to food-related credits such as wages, pensions and social security benefits, especially those paid to people who are at least 60 years old or suffer from serious illnesses. The original proposal, from the Senate, gave preference only to elderly people.

Auctions
With regards to auctions, the PEC provides a discount mechanism by which the creditor who accepts a greater discount of payment due will be paid more quickly. This discount, however, will not apply to the food-related credits nor to those deemed to be of “small” value.

The possibility of holding auctions was one of the most hotly discussed points during the voting of the proposal. The rapporteur defended the discount arguing that a “parallel market” already exists in the payment of these judicial payment orders. “It is not fair to prevent the discount which is given on the street from reducing the public debt”, he declared. “If this was the only possibility of payment, it would be bad, but nobody will be obliged to opt to receive their payment with the discount”, he added.

Resources
The total value that the states, the Federal District and the municipalities will have to pay for judicial payment orders will be established according to the size of the stock of titles and the current net revenue (RCL) of the “debtor entity”.

For the states and the Federal District (F.D.), the percentage of their income assigned to make up this payments will be of:

- at least 1.5% for the states of the North, Northeast and Central West regions, besides the F.D., or those whose stock of pending judicial payment orders in their direct and indirect administrations constitutes up to 35% of RCL;
- at least 2% for the states of the South and Southeast regions whose stock of pending Judicial payment orders constitutes more than 35% of RCL.

In the case of municipalities, the percentage of the revenue for this account will be :

- at least 1% for the municipalities of the North, Northeast and Central West regions, or those whose stock of pending judicial payment orders of the government constitutes up to 35% of RCL;
- at least 1.5% for municipalities of the South and Southeast regions, whose stock of pending judicial payment constitutes more than 35% of RCL.

Reporting – Rodrigo Bittar
Edition – Patricia Roedel