What happens to Braskem on Monday, and why is it significant?

On Monday, the 60-day protective order—known as precautionary injunctive relief or tutela de urgencia cautelar—that shielded Braskem from creditor enforcement actions in Brazil expires. This leaves the company with little time to secure sufficient creditor support to file an out-of-court restructuring (recuperacao extrajudicial), which it had pursued as a faster, less burdensome alternative to a court-supervised restructuring (recuperacao judicial). Without this protection, creditors may immediately resume collection efforts, including seeking accelerated payment—even before any default occurs—as some already have threatened to do.

What are the two main restructuring options available to Braskem under Brazilian law, and how do they differ in duration?

Braskem’s two main restructuring options under Brazilian law are recuperacao extrajudicial (out-of-court restructuring) and recuperacao judicial (court-supervised restructuring). The out-of-court option is quicker and less onerous, typically taking about two years, while the court-supervised process can take approximately five years, according to Vieira Braga Advogados. Braskem had proposed a rapid out-of-court restructuring that could conclude in months, but creditors rejected it—and Braskem, in turn, rejected their counterproposal—leading the company to seek the 60-day injunction to buy more negotiation time.

Brazil Braskem May Lose Protection From Creditors on Monday

Aug 21, 2026

Brazil's Braskem risks losing creditor protection on Monday, hindering its planned out-of-court debt restructuring. The petrochemical producer warns that financial instability threatens cash flow required for raw material procurement and ongoing operations.

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