Brazil: Lula says he ‘went to court’ against privatization of Eletrobras

Brazilian President Luiz Inácio Lula da Silva said, during an interview this Tuesday, 21, that the privatization of Eletrobras was a “crime against the country.

He also said that he had filed a lawsuit against the possibility of buying back the company’s shares.

The objective is to reestablish the control of the company by the State.

“The privatization process was done to prohibit people from taking it back,” said Lula.

“It’s not going to stay that way.”

Today, the company has in its statute a mechanism known as the “poison pill.”

This bureaucratic obstacle makes it difficult for the government to repurchase the company.

In case of the purchase of shares by the State, it would be necessary to pay three times the market value.

The President of Brazil’s Workers Party (PT) has already activated the Office of the Chief of Staff and the Office of the Attorney General of the Union (AGU) to modify the Eletrobras statute to guarantee more power to the government.

Technicians from the agencies involved are working to prepare a Direct Unconstitutionality Action (Adin), which should be presented to the Supreme Court.

The president intends to overthrow the device that establishes that any shareholder must have a maximum of 10% of the voting power at meetings, even if he has a larger stake in the company.

The same criterion applies to the Union, which has 42.6% shares.

Since it has a larger stake, the State could review the privatization process.

However, since the device was created by law in Congress, the only way to overturn it would be to pass another law or appeal to the Supreme Court.

With information from Revista Oeste

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