Brazil's New Laws Reshape Public Defense and Corporate Bankruptcy Paths

Law Complementary 80/94, enacted in 1994, transformed Brazil's Public Defender Office from a makeshift arrangement into a permanent, autonomous institution with a constitutional mandate to expand access to justice for disadvantaged citizens. The reform established the office’s duties, principles and functions, moving legal aid from ad‑hoc appointments to a state‑guaranteed right.

Law Complementary 225/2026, known as the Taxpayer Defense Code, introduces a controversial provision that bars companies classified as “devedor contumaz” (habitual tax defaulters) from filing for judicial recovery and allows the tax authority to convert ongoing recoveries into bankruptcy. Critics argue the measure could force viable firms into liquidation, jeopardising jobs and tax revenue, and may conflict with longstanding Supreme Court precedents that prohibit indirect sanctions for tax collection.