Hard on the heels of last week’s request by Brazilian service provider Oi for debt-related ‘urgent precautionary relief’ from the 7th Corporate Court of the Court of Justice of Rio de Janeiro, regulator Anatel has set up a working group to monitor the Oi Group.
The plan is for Anatel management and Oi to meet in Brasília on Tuesday. However, it seems Anatel plans to keep a close eye on Oi after it requested relief in relation to “a potential renegotiation of certain debts”.
A statement from Anatel, attributed to the Rapporteur, Councilor Alexandre Freire, said: “The working group, in addition to the economic and financial aspects that have already been presented, should bring to the board of directors information and evidence whether the operating performance of the operator poses possible risks to the continuity of the service, the rights of users, the quality of the provision and the maintenance of the granting conditions.”
In other words, the working group wants to know whether and how the situation could affect users of Oi’s services and how Anatel can contribute to the judicial recovery process the Oi Group companies have requested.
Oi must also submit to Anatel, within 60 days of being informed it is required, various details of cash flow, sources of funds and financial forecasts and, notably, “justification for the differences between what was realized and what was foreseen”. Anatel also plans to keep a close eye on any planned sale of assets as part of the hoped-for judicial reorganization plan.
There is a lot more requested from Oi by Anatel. In fact it’s a pretty detailed list of requirements, but it does seem that Anatel regards Oi’s request as a serious matter and wants to avoid any nasty shocks.
However, Anatel, like many commentators, may not yet have all the details. As it says in its press announcement: “At the meeting, to be held on Tuesday at Anatel's headquarters in Brasília, Oi should present clarifications and more details about the current situation and future perspectives, especially related to the impacts on the provision of the fixed telephony concession.”