The Superior Court of Justice, Brazil’s second-highest judicial body, ruled on Wednesday that Brazilian energy company Eletrobras will not need to pay around BRL 11 billion (USD 2.02 billion) on the inflation adjustment of mandatory loans. This credit was created in the 1960s to generate resources to expand Brazil’s electricity sector.
With the decision, judges understood that only interest for late payment is due, as opposed to added interest on unpaid inflation adjustments. The trial has been ongoing since March of last year, with the court finally ruling 5-4 in favor of Eletrobras.
The decision overturned the court’s own ruling from 2019, which ordered the company to pay its BRL 11 billion debt.
Mandatory loans were required on all electricity bills of large consumers until 1993. From then on, these clients were able to convert what they had paid into Eletrobras stock.
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