The legislation of the Russian Federation regarding regulation of civil transactions often changes. This can be said, for example, about the sphere of debt legal relations. In particular, the law on financial insolvency is one of the legal acts that are quite often amended. Which of the recent innovations of the legislator contained in this source deserve special attention?
Legislative nuances
Speaking of innovations regarding bankruptcy law, it should be noted that in the Russian Federation there is only one legal act regulating the sphere of debt legal relations in the aspect of financial insolvency both with the participation of organizations and citizens. We are talking about Federal Law No. 127 “On Insolvency (Bankruptcy)”. It was adopted on 10.26.2002.
Bankruptcy Regulation of Individuals
For a long time, this legal act fully regulated debt relations only with the participation of organizations. They could appeal to the courts, appealing to the provisions contained in the insolvency law, of an enterprise, but not of an individual. However, in 2014, provisions were added to this legal act, thanks to which citizens could also file for bankruptcy.
There is an incorrect point of view that there is a separate law on the insolvency of individuals. This is not true. Bankruptcy as citizens and organizations is regulated by one legal act, noted by Federal Law No. 127. Recently, it is also the law on the insolvency of credit organizations.
Bankruptcy Regulation of Financial Institutions
The fact is that until December 2014 the bankruptcy procedure of banks, in fact, was regulated by a separate legal act - Federal Law No. 40, adopted on 02.25.1999. Now the legislation regarding financial insolvency is thus combined in a common source. It does not matter how to interpret it - as a legal act regulating the bankruptcy of businesses, banks, or as a law on insolvency of individuals - the text of the law will be the same in many of its provisions, despite the fact that the legal status of subjects of debt legal relations is different.
Specifics of innovations
The very fact that the insolvency law included provisions regarding the relevant procedure with the participation of individuals can be regarded as a sensation: for more than 10 years, thus, the legislator ignored the possibility of regulating bankruptcy of citizens, but suddenly decided to reconsider his attitude to the relevant areas of activity. Therefore, if we talk about some large-scale innovations introduced into legal practice through the Federal Law No. 127, it is precisely the fact that a full-fledged law on the insolvency of individuals has appeared in the Russian Federation. The text of the corresponding legal act was enthusiastically studied by ordinary citizens. In particular, those who managed to collect various loans and began to have difficulty repaying them.
After the relevant legal act has acquired a full-fledged form, a law on the insolvency of individuals, individual entrepreneurs, and business companies has appeared in the Russian Federation - new amendments to it are still being introduced by the legislator. They relate to various aspects of the sphere of debt relations. Our task is to consider the key ones.
Regulator is attentive to legal entities
It may be noted that recent adjustments relate mainly to communications involving enterprises. The activities of individuals are so far regulated by the former provisions, which, however, are very new in themselves. The latest amendments to the bankruptcy law, adopted on December 29, 2014, can be considered to be directly related to enterprises (although upon a detailed examination, some of them can be interpreted in relation to citizens). Therefore, in the article under the term "debtor" we will mean, first of all, a legal entity. Those provisions that will be discussed are fully applicable to organizations.
Interaction of banks with arbitrations
Changes in the bankruptcy law touched upon such an aspect as the interaction of creditors - in the status of banking organizations, with arbitration courts. In accordance with the innovations, financial institutions have the right to apply to these instances, even if they do not have a decision of a court of general jurisdiction to recover financial resources from the debtor. In this sense, credit organizations have gained a preferential position in relation to the powers of the competitive entities, which, in turn, must have the appropriate judicial decision in their hands.
Minimum Instance
Prior to the relevant innovations, the creditors had to apply to the court in accordance with the lawsuit proceedings. After that, they needed to wait until an appropriate decision was made on recognition of the debt by the borrower and on the need to collect it. The next stage was connected with the expectation of the court ruling coming into legal force. In addition, the debtor could appeal, which implied the participation of the creditor in new court hearings, and it would be good if it was successful for him. Now, a preliminary appeal to the court is not required. But it should be noted that this rule applies only to banks, that is, structures officially registered as a credit organization.
Bank sequence
It will be useful to consider the procedure for some actions, which, in accordance with legislative innovations, the bank should follow when initiating the bankruptcy of the debtor.
Thus, from the moment the relevant amendments enter into force, namely, from July 1, 2015, the credit institution must publish a notice 15 days before applying to the arbitration regarding its intention to initiate the recognition of the debtor insolvent. This document is sent to the Unified Federal Register of Information on the Activities of Legal Entities. Note that before the amendments entered into force, the deadline for submitting the corresponding notification was up to 30 days, while the document must be sent to the debtor, as well as to creditors known to the bank.
As a result of legislative innovations, a bank can initiate a bankruptcy procedure for a borrower without additional lawsuits. Moreover, he is entitled to start the corresponding work earlier than the rest of the creditors, thereby, being the first to receive the necessary documents regarding the activities of the debtor.
Choice of interim manager canceled
Changes in the bankruptcy law touched on such an aspect as the procedure for appointing an interim trustee. Prior to innovations, the debtor had the right to choose the person performing the appropriate functions, based on his own preferences. After changes to the law were approved, interim managers were appointed by random choice. True, the specific mechanism of such a draw is not yet determined. In this regard, the interim manager will be appointed by the court until the necessary mechanisms are approved in laws.
Prior to the innovations, the borrower could appoint a manager who was, in fact, accountable to the firm. A person holding this position could not prevent the debtor company from continuing to do business. It was also possible that “his manager” would turn a blind eye to the real financial problems of the debtor company. It remained likely that lenders whose claims were undesirable to the borrower would not be included in the register of claims. Also, the manager appointed by the debtor company could help the company to commit various illegal actions, for example, to conceal certain facts that are significant for the court and for creditors.
What is the procedure for a debtor to change a bankruptcy law? Before applying to the court, if it is the borrower who initiates the recognition of financial insolvency, he must publish a notice regarding this activity in the Unified Register. After that, an arbitration manager is randomly appointed, but, as we noted above, so far this procedure is not regulated, and the choice of a person for the corresponding position is in the competence of the court.
Minimum Debt
Changes in the insolvency law also affected such a criterion as the minimum amount of debt, which gives the right to the parties to a debt relationship to initiate bankruptcy proceedings. In this case, we are talking only about debtor organizations. Before innovations, the corresponding value was 100 thousand rubles. (for natural monopolies - 500 thousand). After adjustments to the law, the numbers increased: bankruptcy can be initiated if the company owes at least 300 thousand, and if it has the status of a natural monopoly, from 1 million rubles. The Law on the Insolvency of Individuals, which is noteworthy, is characterized by more stringent conditions in terms of the minimum amount of debt: a citizen's bankruptcy is possible only if he has borrowed and cannot pay 500 thousand rubles. and more. So far, the lawmaker has not made adjustments to this norm.
Secured Creditors Rights
Changes in the bankruptcy law gave reason to say that collateral lenders - those whose claims are backed by certain assets owned by the debtor, have received additional rights. Which ones? In particular, this is the right to vote at meetings where questions are decided on the choice of a manager, as well as when applying to the court regarding the removal of a person in an appropriate position, on the transfer of the company to external management. Prior to innovations, security lenders could exercise their voting right most often only at the stage of observation.
Mortgage lenders, after amending the law, have the right to fix the initial value of the pledged item, as well as the order in which tenders should be held. If the opinion of the relevant subjects of debt relations does not find understanding among other participants in the bankruptcy procedure, the court should intervene.
If the company, which is considered insolvent, performs the replacement of assets, for example, when several business companies are created on the basis of the company, then pledged creditors receive the right to satisfy their requests at the expense of joint-stock assets.
Creditors of the corresponding category received the right to retain the subject of pledge during the bidding process. To do this, they need to make a public offer if there are no applications for participation in this type of tender. This, according to experts, can be interpreted as an additional mechanism to ensure the protection of the interests of secured creditors.
Limitation period
Among other noteworthy innovations that have introduced changes to the bankruptcy law, one can single out a mechanism by which bankruptcy creditors may declare that the statute of limitations for the debts of other entities making claims to the borrower has expired. Previously, the legislation did not provide for such an opportunity.
Responsibility for timely bankruptcy notice
The heads of firms in which financial difficulties have arisen that give rise to talk about the appearance of signs of bankruptcy are required to notify the owners. If the director of the organization does not fulfill this obligation, then a fine of 25-50 thousand rubles may be imposed on him. It can also be noted that responsibility for other illegal actions of the company’s management during the bankruptcy procedure has been tightened.
Bankruptcy Must Be Reasonable
Before amendments to the bankruptcy law were introduced, there were no grounds for terminating cases in which bankruptcy was the subject. That is, for example, if the court revealed any abuses on the part of the initiator of the bankruptcy procedure, there could be no legal consequences. The new version of the law says that going to court, the subject of which is the initiation of the process of declaring the debtor insolvent, should not be limited to formal justification. It is important that the borrower is insolvent in fact.
If, thus, the court determines that the debtor or creditor who initiated the bankruptcy procedure knew that the relevant entity was completely solvent, that is, pursued profit, the proceedings could be legally suspended. Provided, of course, that by that time the borrower will not lose solvency. Such a norm allows the courts to stop collusion between debtors and creditors, which, due to various circumstances, may be beneficial to them, but at the same time cause damage to other interested parties.