Brazil’s Superior Court of Justice, known as the STJ, has cleared the state of Rio de Janeiro to resume immediate collection of R$80 million in overdue tax-debt installments from Refit, the group that controls the Manguinhos refinery in Rio de Janeiro, according to CNN Brasil.
The decision by STJ President Herman Benjamin overturns an injunction that had prevented the state from enforcing the payments. CNN reported that the ruling may also open the way for Rio’s government to seek recovery of about R$14 billion in taxes allegedly owed by the group.
Refit belongs to businessman Ricardo Magro, who is wanted under an arrest warrant issued by Brazil’s Supreme Federal Court, the country’s highest court, and has been placed on Interpol’s red notice list. CNN said Magro is sought on suspicion of tax fraud and tax evasion. Refit, which controls Refinaria de Manguinhos, is under court-supervised bankruptcy protection, a Brazilian restructuring process known as recuperação judicial.
The case turns on a January decision by the Rio de Janeiro state court that suspended collection of Refit’s financial obligations. Appellate judge Guaraci de Campos Vianna held at the time that Refit’s failure to make payments had not resulted from the company’s own choice, but from the stoppage of its operations and the imposition of court-ordered asset freezes. He argued that sanctions could undermine the restructuring process and harm jobs and creditors.
Vianna was later targeted in a Federal Police operation and removed from his post by the National Justice Council, the body that oversees Brazil’s judiciary. According to CNN, he was accused of issuing decisions suspected of favoring Refit.
In his ruling, Benjamin said the R$80 million in overdue installments could not be treated as a negligible sum or as merely hypothetical harm. He said the amount exceeds the entire budget allocation of some Rio state government departments.
Benjamin also said the harm went beyond the expired installments. By blocking tax enforcement actions and preventing coercive measures against the debtors, the Rio court decision deprived the state of the ability to pursue a tax claim worth billions of reais, at the same time that Refit-related assets were reportedly subject to constraints by the state of São Paulo and the federal government.
The STJ president said that created a concrete risk that assets could be drained and that guarantees for Rio’s tax claim could be lost, possibly irreversibly, while other public entities remained able to secure assets for collection.
CNN Brasil said it contacted Refit, but the company had not commented by the time of publication. This article is based on single-source reporting from CNN Brasil.