Upon the declaration of the covid-19 pandemic by the World Health Organization (WHO), we are currently experiencing a situation of global anxiety that requires attention in the face of a crisis that a few months ago seemed unthinkable. Like other countries, Brazil has also adopted various measures to combat the spread of the virus.

 

Federal Law No. 13979, of February 6, 2020, was one of the first legal standards published in Brazil in response to the covid-19 outbreak. It described the main measures to be implemented in order to contain the spread of the virus and support society, including those aimed at ensuring access by health market players to protective equipment, medicines, and other tools needed to combat the imminent pandemic.

 

In less than a month, the drastic change in the scenario led to the publication of Executive Order No. 926/20 and other state and municipal regulations throughout Brazil. They have restricted several economic activities, especially those related to retail and entertainment, to avoid crowding. Although such measures were well received by a large part of the population, there were still doubts about the need to maintain other ancillary activities related to essential ones.

 

Only on March 20, with the publication of Federal Decree No. 10282/20, which regulates article 3, paragraph 8, of Law No. 13979/20, was it defined, in its article 3, paragraph 1, what should be considered to be "essential and indispensable services and activities to meet the unavoidable needs of the community", among which: (i) health care, medical and hospital services; (ii) social assistance and care to populations in a vulnerable condition; (iii) public and private security activities; (iv) national defense and civil defense activities; (v) telecommunications and internet; (vi) water collection, treatment, and distribution; (vii) sewage and garbage collection and treatment; (viii) electric power generation, transmission, and distribution; and (ix) services related to information technology and data processing (data center) to support other activities.

 

Perhaps even more important, article 3, paragraph 2, of Federal Decree No. 10282/20 correctly included also as essential activities, the ancillary activities of support and supply necessary for the production chain associated with the performance and operation of public services and essential activities. Quite accurately, it identified that stopping these ancillary activities would lead to a hindrance or even suspension of activities and services deemed essential, thereby affecting the entire population in social isolation for an indeterminate period of time.

 

Although article 2 of the decree establishes that its provisions shall apply to all bodies of the federation (public and private), and given the strong legal arguments to defend the position that the rules therein should prevail over any other state and/or municipal measures, one may not want to overlook that some of the measures provided in Federal Decree No. 10282/20 may be disputed by states and municipalities. After all, they have constitutional duties to fulfill and many are being pressured by the population to respond to the total paralysis of local economies.

 

It is different for companies that provide services or inputs necessary for the maintenance of other essential activities, such as manufacturers of components and raw materials for the production of ventilators, masks, gloves, and other medical equipment and accessories. These organizations not only have the right, but also the duty to continue operating so that, in fact, there will be no shortage of what is essential to overcome covid-19 in Brazil.

 

Thus, if a certain company believes that it performs an activity considered ancillary to an essential activity performed by another supplier, it must gather evidence that continuity of its services is essential for maintenance of the production chain of an essential activity. This evidence may be brought to the attention of the competent authorities or even support judicial measures to protect the continuity of the activity.

 

It is worth remembering that companies that play an ancillary role in some essential activity are not exempt from adopting, in their business unit and in the entire production chain (including those responsible for distribution centers), strict measures of hygiene and care to prevent infection of their employees, business partners, and other staff members. They should also provide products and means for proper sanitization and for taking the temperature of their employees, in addition to keeping the environment ventilated and disseminate frequent and clear information with guidance on covid-19 prevention measures.

 

It is not possible to anticipate how long the current pandemic will last or how the restrictive measures necessary to combat covid-19 will evolve. Given the dynamics of the disease, it is likely that new laws, decrees, and regulations will be published in the coming days or weeks. For this reason, before implementing any measure, we recommend that companies should consult their legal advisors, and assess possible risks and preventive conduct necessary to perform in this scenario of great legislative instability.