Supreme Court of Russia proposed to raise the limit of debt in case of out-of-court bankruptcy

The head of the Supreme Court of Russia, Vyacheslav Lebedev, proposed to raise the debt limit established in Russia for out-of-court bankruptcy of individuals.  At a meeting of courts of general jurisdiction and arbitration with the participation of Vladimir Putin, the chairman of the Highest court of Russia summed up the results of the past year and announced the proposed changes.

Among other things, Vyacheslav Lebedev mentioned that compared to 2020, during the previous year, the courts considered 85% more insolvency cases. At the same time, since the fall of 2020, the country has introduced a procedure of out-of-court bankruptcy for individuals. It allows individuals to submit the necessary application to the MFC and write off their debts. At the same time, the limit on existing debt is set at a limit of up to 500,000 rubles.

To speed up the procedure for releasing citizens from unbearable debt burdens, the chairman of the Supreme Court of Russia proposed to raise the upper limit of debt to 1.5 million rubles.

Separately, Lebedev noted that the pension of a citizen from whom a debt is collected as part of a bankruptcy case should not be included in the bankruptcy estate. This is done to respect the social rights of citizens.

Another initiative of the Supreme Court of the Russian Federation in the framework of out-of-court bankruptcy is to give bankruptcy trustees the right to establish creditors' claims against the debtor, including consideration of the issue of their validity. In order to balance the mechanism, it is proposed to legislatively grant the creditor the right to initiate a court case on disagreements with the position of an anti-crisis manager.