We know everything about bankruptcy
18/12/2024
Wednesday
18 December 
1970 France, on behalf of 25 EU countries, called for the decriminalization of same-sex relations.
1970 France, on behalf of 25 EU countries, called for the decriminalization of same-sex relations.
1970 The slavery was abolished in the United States.
1970 the slavery in the United States was abolished.
1970 The anthem of the Russian Empire “God Save the Tsar!” was performed for the first time.
LIFTING OF MORATORIUM: IS THE WAVE OF BANKRUPTCIES COMING?
The state made a decision not to extend the moratorium on bankruptcy any longer. Decree of the Government of the Russian Federation of October 1, 2020 No. 1587, which established a new moratorium period, introduced initially from April 6, 2020, became invalid on January 8, 2021 due to the expiration of the document. Now, in relation to individual entrepreneurs and organizations that were classified by the Government as among those most affected by the pandemic, the common procedure for declaring the debtor bankrupt is in effect.
Accordingly, the restrictive measures and benefits provided for by Art. 9.1 of the Bankruptcy Law on a moratorium (for example, suspension of enforcement proceedings, accrual of interest under Art. 395 of the Civil Code of the Russian Federation and other financial sanctions, etc.) are not valid any more.
In connection with the lifting of the moratorium, the features of the procedure have been restored. So, if “before” or “during the period” of the moratorium, the creditor publishes a notice of intention to apply to the court with an application for declaring the debtor bankrupt, but fails to do so, then he (she) will have to submit such a notice again.
When it comes to the bankruptcy cases initiated within 3 months after the termination of the moratorium (until April 7, 2021) in respect of the debtors to whom it applied, some special rules for consideration established by paragraph 4 of Art. 9.1 of the bankruptcy law will be in force. They will be related to the determination of the periods of recognition of persons interested in relation to the debtor, the periods of invalidity of the debtor's transactions, the date on which the amount of claims is determined, the procedure for voting when approving the settlement agreement, the moment from which the claims are considered current, increasing the priority of the claim of the controlling debtor for the return of compensation financing granted during the moratorium.
On December 24, 2020, the Plenum of the Supreme Court of the Russian Federation approved Resolution No. 44 "On Certain Issues of the Application of Provisions" Art. 9.1 of the Law on Bankruptcy, containing many valuable and relevant clarifications for the nearest future.
Lifting of the moratorium on bankruptcy will predictably lead to an increase in the number of applications for recognizing debtors as insolvent due to deferred applications, including on the basis of decisions to satisfy claims against debtors received during the period of the moratorium, which the moratorium did not forbid to consider.
At the end of 2020, the number of corporate bankruptcies decreased by almost 20%, which is most likely the result of a 9-month moratorium. In the first days after the moratorium was lifted, the number of bankruptcy petitions accepted by the courts did not differ from the average values for previous periods.
An alarming signal looks like a sharp increase in bankruptcies of individuals in 2020 - more than 72% compared to 2019. However, due to the novelty of the toolkit, the statistics of personal bankruptcies cannot yet be a “barometer” of the general state of the economy and the decline in personal consumption of citizens.
A balanced and objective assessment of the effectiveness of the moratorium can be given only after at least six months, when more extensive statistics are available.
Information for a six-month period will give an idea of the real economic consequences of the pandemic, as we assume that after the moratorium is lifted, the “natural level” of bankruptcies will be slightly higher due to enterprises from the affected industries.
At the same time, no one expects the bankruptcies of backbone enterprises that fell under the moratorium and other large players, for example, airlines, for which the state has provided quite significant support. As a rule, retailers are also quite stable.
In the event of a negative scenario involving a multiple increase in the number of bankruptcies, the government will be forced to take emergency measures, both related to the “resuscitation” of the previously approved instruments (for example, moratorium) and to find new support mechanisms. In any case, practitioners have been waiting for a new law on the reform of the institution of bankruptcy, the draft law of which already involves the abolition of three procedures (supervision, financial recovery and external management) and the creation of a new rehabilitation procedure - debt restructuring with a very flexible restructuring plan that will be in effect for four years with a possible extension.
