On September 1, amendments to the Bankruptcy Law entered into force in Russia, allowing Russians to go through bankruptcy proceedings free of charge and without going to court. They are published on website State Duma of the Russian Federation.
According to the law that came into force, debtors whose bailiffs did not find property, and whose debt is no more than 500 thousand rubles, will be able to file bankruptcy petitions through multifunctional centers (MFC). The insolvency procedure will take six months, during which time creditors can try to bring the insolvency case to court.
To declare personal bankruptcy out of court, a Russian must have a debt of 50 thousand to 500 thousand rubles, and also not have property or the ability to pay off debts. This means that no new enforcement proceedings should be opened against him, and according to the old proceedings, the writ of execution should have been returned to creditors without results.
If a citizen meets the conditions, then he can file for bankruptcy at the MFC, where his obligations and creditors will be checked in the coming days. If the application is satisfied, the MFC will launch the bankruptcy procedure within four working days, after which the information about the debtor will be included in the Unified Federal Register of Bankruptcy Information, and from that moment the accrual of interest, penalties and fines on the debt will be stopped.
Six months must elapse from the beginning of the bankruptcy procedure until the debtor is declared insolvent. If during this period none of the creditors interferes with bankruptcy, then the citizen’s debt will be recognized as hopeless and written off. During the procedure, a citizen is prohibited from taking new loans, credits, and acting as a surety. In case of receiving property at this time, he will be obliged to notify the MFC within five working days.
Lenders can try to verify the data on the property of the borrower in six months by sending a request to government agencies. In addition, they are allowed to try to transfer the bankruptcy procedure to court, proving that the citizen’s debt is more than 500 thousand rubles.
According to the calculations of the Ministry of Economic Development, which leads “Kommersant”, annually over 110 thousand Russians will use the new norm. At the same time, the procedure will play into the hands of even creditors, since bad debts of up to half a million rubles often hang like a dead weight on the balance sheets of financial organizations. And an individual in the new conditions will not incur additional costs.
As noted by the expert of the ONF project “For the rights of borrowers” Mikhail Alekseev, with a debt of up to 100 thousand rubles. banks, as a rule, do not seek to sue, since for them judicial recovery is also associated with certain costs and expenses.
The new law is also very beneficial to creditors: under the new conditions, the creditor has the right to stop the procedure if he does not find himself in the debtor’s application, or to challenge it in court, paying the costs. Also, creditors will be able to independently search for the property of a potential bankrupt and even write requests to government agencies.
Other experts note that the new law opens up room for abuse by individuals, since the list of creditors in the application remains at the discretion of a potential bankrupt, and his property will be searched for according to federal registers, where far from everything is listed. “Excuse me, he has what in the register? An apartment, a summer house and a car. Is this the end of wealth for a person? He may have accounts, other things that are not listed in the register. In addition, they may be interested not in bankruptcy, but in not to pay one, but with the help of others to withdraw all their assets. There will always be people who will look for ways to cheat. But if initially a hole is left in the law, then there will be more of these fraudsters, “explains the head of the SRO” Mir “Elman Mehdiyev …
On the other hand, the new law makes it possible to limit abuse: the procedure can be used once every 10 years, and the debtor himself will be included in the bankruptcy register and will not be able to count on a new loan very soon. In addition, bankruptcy itself imposes a number of restrictions, including travel bans, entrepreneurial activities and leadership positions in organizations. “Therefore, the bankruptcy procedure itself is not easy. And before you enter it, you need to carefully weigh everything,” explained Vladislav Kocherin, a lawyer and managing partner of the Kocherin and Partners law firm.
In January-September 2019, Russian courts declared bankrupt 46.7 thousand citizens, including individual entrepreneurs. This is one and a half times more than in the same period of 2018: according to experts, Russians are becoming more and more informed about the advantages of bankruptcy, arbitration managers have worked out technologies, and courts – the practice of considering such cases.
As follows from the data of “Fedresurs”, the bankruptcy procedure is most often initiated by the debtors themselves: 89.8% of all proceedings fall on such cases. The share of bankruptcy creditors, including banks, is 8.2%. In 78% of cases, the debtor has no property that could be sold to pay off obligations. In the first half of the year, the volume of claims for completed bankruptcy procedures exceeded 119.1 billion rubles, but less than 4 billion rubles were collected from citizens.