About

Can you briefly explain how the legal team is structured, highlighting key individuals and their role within the department?

Klabin’s legal department is divided into three management areas: Corporate, with governance as its key element, handling all corporate, M&A and financial contracts matters; operations, with operational efficiency as its key element, taking care of all aspects of civil, labour and environmental litigation, as well as contracts, industrial property and consulting services related to the company’s operations; and the tax area, with financial results as key element and responsible for all aspects of tax planning, tax and social security litigation and consulting services, in addition to matters related to the trade regulation area.

What are the most significant cases and/or transactions that your legal team has been involved with in the last two years?

The team’s activity can be divided into the following groups. Taxation Cases: a tax litigation regarding the exclusion of ICMS from the PIS and COFINS calculation basis – approximately R$1bn; a tax litigation regarding presumed IPI credit – approximately R$1bn; a tax efficiency in international financial operations – approximately R$200m; a tax efficiency in social security and indirect taxation – approximately R$120m.

Financial Transactions: The team secured viability for the company and for the bond issuance market, in the amount of U$1bn, divided into two series, one with a term of 30 years (green bonds), interest of 7% a.p.r., and the other with a 10-year term (general corporate purposes), with interest of 5.75% a.p.r.

Expansion projects: Puma Project –a construction (green field) of Klabin’s new pulp mill, with a production capacity of 1.5 million tons, including 1.1 million tons of hardwood pulp, in the municipality of Ortigueira/PR; Puma II Project – the expansion (brown field) of the pulp mill, rolled out in two phases: The first involves the construction of a fibre line to produce unbleached pulp integrated with a Kraftliner and white Kraftliner paper machine, to be sold under the Eukaliner brand, with annual capacity of 450,000 tons. The second includes the construction of a complementary fibre line integrated with a Kraftliner paper machine, with capacity for 470,000 tons per year, as well as the expansion of some support structures.

What are the most difficult hurdles to overcome when attempting to demonstrate value added by the legal team?

Putting the day-to-day advisory work into figures, along with support for negotiations, preventive work and counseling. It’s always a challenge to demonstrate the legal team’s full contribution to a strategic decision of the company using data and facts. Another obstacle, but one that we have been able to overcome over the last few years, is demonstrating Legal as a generator of results for the company. For this reason, we use the key points of governance, operational efficiency and financial results to demonstrate, in an organised manner, the full contribution of a legal expert of choice, defined with a simple question to the internal partner: “If you had the funds to freely choose and hire any attorney, we would like you to choose the Klabin legal team!” What it means to be the legal expert of choice, is a challenge that demands the reliability and total alignment with the company’s business.

What “legal tech” products does the team utilise? What is useful about the products and how could they be improved?

In recent years, we have invested heavily in partnerships with legal techs, aiming to bring maximum innovation to the day-to-day routine of the legal department. Currently, we rely on the following legal techs as technology partners of the legal team: Doc9 – an online platform for due diligence, such as the participation of representatives in hearings and collection of documents nationwide; Forelegal – a platform with statistics on the progress of labour court proceedings; Legal Insights – a dashboard with all relevant and strategic data related to the company’s litigation matters; Optimum – which analyses and predicts labour court decisions based on statistics and history of cases by state, judge and court, calculating the probability of loss/win for a case, impacting contingency; Optimus – a system of contract and consulting demands that tracks the Team’s deadlines, changes and task routines; Spotfire – a dashboard of the legal team’s budget and analysis of expenses; Legal One – a doctrine and jurisprudence consultation system for professional development and legal grounds for answers to queries and day-to-day analyses; Projuris – a litigation management system, containing all financial contingency, process accounting, main parties and progress, providing the entire basis for strategic or predictive reports. Dilligent Board – a leading board management software.

Is diversity and inclusion as a matter of internal policy on the agenda at your company? How much influence do you, as an in-house legal team, have on the diversity and inclusion policies of your organisation?

Yes, totally. The legal department guides the company based on current legal requirements to promote inclusion policies, in addition to the economic and social benefits of diversity. The encouragement of diversity within the legal team itself also warrants emphasis. We believe that being a legal team of choice also means that the internal partner has to feel represented by this team, which is why the issue is so relevant to us.

Have any new laws, government policies, regulations or judicial decisions greatly impacted your company’s business or your legal practice?

Brazil has a very complex and insecure tax scenario. Therefore, over the last few years many legislative changes, administrative rulings and judicial decisions have affected the company. Some examples are judicial decisions regarding the possibility of credits for social contributions PIS and COFINS and the exclusion of ICMS from such contributions calculation basis, controversial administrative rulings regarding the taxation of exportation revenues by IOF, and statute of limitation for credits utilisation. We have also been monitoring the various tax reform proposals under discussion in Congress, which, if implemented, might bring several tax impacts to the company and its business. We have been increasingly preparing and supporting the company’s adaptations to the new general data protection law, and we believe that the recently enacted Provisional Economic Freedom Measure will bring a new challenging environment to the contract area. The Labor Reform, in force since the end of 2017, has significantly changed the dynamics of labour litigation and consulting.