|
|
 | | | |
- close
- close
- close
- close
PBR » Topics » We may incur losses and spend time and money defending pending litigations and arbitrations.This excerpt taken from the PBR 20-F filed May 22, 2009. We may incur
losses and spend time and money defending pending litigations
and arbitrations.
We are currently a party to numerous legal proceedings relating
to civil, administrative, environmental, labor and tax claims
filed against us. These claims involve substantial amounts of
money and other remedies. Several individual disputes account
for a significant part of the total amount of claims against us.
For example, on the grounds that drilling and production
platforms may not be classified as sea-going vessels, the
Brazilian Revenue Service asserted that overseas remittances for
charter payments should be reclassified as lease payment and
subject to a withholding tax of 25%. The Revenue Service has
filed two tax assessments against us that in the aggregate, on
December 31, 2008, amounted to
R$4,372 million (approximately
U.S.$1,871 million). See Item 8. “Financial
Information—Legal Proceedings.”
In the event that claims involving a material amount and for
which we have no provisions were to be decided against us, or in
the event that the losses estimated turn out to be significantly
higher than the provisions made, the aggregate cost of
unfavorable decisions could have a material adverse effect on
our financial condition and results of operations. In addition,
our management may be required to direct its time and attention
to defending these claims, which could preclude them from
focusing on our core business. Depending on the outcome, certain
litigation could result in restrictions on our operations and
have a material adverse effect on certain of our businesses.
|
| |||||||
