Bankruptcy is a Measure of Last Resort with a Number of Nuances and Alternatives.
The Law on the Recovery of Insolvency and Bankruptcy of R.C. Citizens, signed by the President on 30 December, provides for three new procedures for debtors who are in arrears in paying their debts for a long time, with the possibility of stopping the accrual of penalties. The procedure initiated by the debtor himself/herself, of his/her own free will.
1. Restoration of solvency - without imposing additional penalties, it suspends the accrual of penalties and allows payments to be spread over a longer period, according to a rehabilitation plan of up to 5 years, in row. In this case, the repayment of debts shall follow a plan drawn up by the financial manager together with the debtor and approved by the court.
2. Extra-judicial bankruptcy - total debts limited to 1,600 MCIs, absence of bankruptcy status of a natural person for 7 years, absence of property and delinquency in payment of debts for the last 12 months are grounds for initiating an extrajudicial bankruptcy procedure.
3. Judicial bankruptcy - the debtor's property must be disposed of in order to fulfil the obligations, the only dwelling cannot be disposed of if it is not pledged, the unlimited total debt, and the other claims correspond to the extrajudicial procedure as a ground.
The time limit for the procedure is no more than 6 months; According to emerging jurisprudence in general, we consider that the courts will make full use of the time limit.
It is worth noting that bankruptcy status is subject to the following restrictions: for five years after the completion of the procedure, no loans can be granted, and no pledges, guarantees or sureties can be accepted under bank loan and microloan contracts.