Private bankruptcy procedure - how much will the world experience in Russia take into account

Irina Lagunina: The draft law “On Bankruptcy of Individuals” is being prepared in Russia. According to the plans, he will enter into force on January 1, 2009 and will act in relation to those citizens who, having received consumer loans, are unable to pay for them. Even with a greater installment plan ...

The mechanism of bankruptcy of individuals, offered by the authors of the project, largely repeats the provisions of legislation on private bankruptcy in force in Europe and in the United States. Read more about this - in the material of Sergei Seninsky ...

Sergey Seninsky: ... any legislation on bankruptcy in one way or another provides for a start the possibility of restructuring, that is, a new schedule for repayment of debts accumulated by a person for some period of time-3 years, 5 years and even more. The Russian bill is still proposing a 5-year period. The bankruptcy procedure begins in cases where the debtor either does not submit himself or does not agree to the proposed arbitral tribunal - a plan for the restructuring of the accumulated debts, as well as when the restructuring has not been possible has not been successful.

At the same time, the debtor himself can initiate bankruptcy proceedings, as follows from most legislation, including the future Russian law. Our first interlocutor-in Germany-Anna-Marie Zaam, representative of the German Association Creditreform, created 130 years ago:

Anna-Marie Zaam: In Germany, both the debtor and creditors are entitled to initiate bankruptcy proceedings, especially when they notice that the financial situation of the debtor becomes shaky.

The total amount of claims, as such, does not play a special role. A legal reason for starting bankruptcy proceedings can be considered a situation where the debtor is not able to pay the creditor within four weeks 10% of the amount of current debt requirements. That is, not from the entire amount of the debt, of course, but from current payments in respect of which the creditor makes claims. In such cases, according to the law, the debtor is obliged to declare his bankruptcy himself.

Bankruptcy procedures in Germany are understood by special bankruptcy courts, which, in turn, are part of the district court of lower instance.

Sergey Seninsky: The draft Russian law proceeds from the fact that the bankruptcy procedure is initiated in cases where the total amount of overdue debt exceeds 100 thousand rubles. At the current rate - a little more than 4 thousand dollars. In the United States, the same “threshold” is about three times higher, says Professor Kornel University, New York, Ted Eisenberg:

Ted Eisenberg: Bankruptcy procedure usually begins by debtors themselves. Although, according to the law, lenders can initiate it. For example, we, in the state of New York, can do this if the debtor as a whole has at least 12 creditors. One of them or several may apply to the court with a request to declare their debtor bankrupt if the amount of debt exceeds 13 thousand 475 dollars.

Sergey Seninsky: At the same time, in the bankruptcy procedure, a significant role is given to the debtor himself ...

Ted Eisenberg: The case begins with the application of the application to the court. The court appoints a temporary proxy. This is a US Department of Justice working in this federal court. He begins the process of bankruptcy, considering the initial statement.

Then, under his leadership, all creditors of the debtor gather and choose a permanent proxy. This person will directly control the process. Typically, the plan or the procedure for eliminating property offers bankrupt in the United States. A confidant can approve or reject this plan.

Sergey Seninsky: How often can a person declare himself bankrupt? According to the draft new Russian law, - no more than once every five years ... From Germany - Anna -Marie Zaam, representative of the Creditreform Association:

Anne-Marie Zaam: In Germany, the bankruptcy procedure of private individuals lasts, as a rule, about seven years. We call this a “period of well -moral behavior” - the time when the guardian’s guardian appointed by the court decision disposes of the property of the debtor in order to more or less satisfy the claims of the creditors. And after this transition period, the debtor has no right to declare himself bankrupt for another 5 years ...

Sergey Seninsky: In the United States, this period is even longer. Professor Kornel University TED Eisenberg:

TED Eisenberg: A statement of bankruptcy court, first of all, must contain truthful information about the financial condition of the debtor. This is the first and most important requirement. If it turns out that the information is false, a person simply will not allow himself to declare himself bankrupt. Even if from the time of his previous bankruptcy, 8 years stipulated by the law have already passed. The court may consider that the debtor is trying to abuse law. For example, he scored a bunch of loans just before applying for bankruptcy. That is, he was not going to return them ...

Sergey Seninsky: And in most cases, lenders as a result of the sale of property of the debtor receive only a small part of what is due to them. In Germany, for example, more than 80% of all cases of private bankruptcies account for those in which there is nothing to sell. Or, as lawyers say, for cases of “zero property mass” ... In the USA - about the same ...

TED Eisenberg: The Federal Bankruptcy Law, of course, determines the procedure for paying creditors of money proceeds from the sale of property of the debtor. But in practice - bankrupt almost has nothing left. And therefore, from the sale of his property, creditors, as a rule, receive less than 5% of what he owes them ...

Sergey Seninsky: If a person gained debts from several creditors - say, loans from different banks, how exactly will be distributed between them those amounts that will be able to help out from the sale of property of the debtor? From Germany-Anna-Marie Zaam, Association Creditrefor:

Anne-Marie Zaam: First of all, the claims of those who have the so-called “right of pledged property” are satisfied. This means that if the creditor has timely fixed such a right, then the property that was owned by the bankrupt should be returned to him as a whole - it cannot be crushed or sold. As in the case of a new apartment purchased on a mortgage loan: until it is paid, the rights to it belong to the creditor bank. Similarly, if there are certain guarantees in relation to the debtor.

All other requirements fall under the category of “secondary” and are satisfied only in proportion to the remaining “common boiler”. And, frankly, timely to acquire the right of collateral in Germany, I would especially recommend to foreign partners and creditors.

Sergey Seninsky: One of the restrictions that contains any legislation on private bankruptcies is to sell not all property of the debtor to pay off debt to creditors. So, according to the draft new Russian law, the debtor’s dwelling cannot be sold, if it is the only one for him. It is not known, however, as the authors of the bill propose to do in cases where the only apartment of the debtor is considerable size. The legislation of the United States and Germany provides for such cases for such cases.

In addition, the debtor - both in Russia, in the USA, and Germany - will retain household items, as well as a certain part of earnings and the property that is necessary for his work. From Germany-Anna-Marie Zaam:

Anne-Marie Zaam: The bankrupt should, firstly, maintain a monthly income of about 1000 euros-as a living wage. In addition, on the expense of repayment of debts, it is impossible to sell daily household items, which elementarily provide a civilized lifestyle. These include furniture, TV, radio receiver, inexpensive audio system, refrigerator, kitchen stove, as well as kitchen and other accessories. All the rest of the property is described or arrested.

There are times when even his car is left to the bankrupt, if he can prove that he found a new job, and it is very difficult to get to it by public transport. After all, the guardian understands that part of the new salary of the debtor will go precisely to pay off old debts.

But with a large house or a spacious apartment, whether it is personal property or rented, the debtor will have to say goodbye and move to a small apartment. But of course, they will leave him a small own apartment.

In other words, the bankrupt should not be deprived of the necessary life comfort and thereby turn it into homeless. Special circumstances are also taken into account - for example, a large family and the like ...

Sergey Seninsky: In relation to personal vehicles in Russia, a more stringent decision is being proposed: the car will be left bankrupt only if it needs it due to disabilities. In the USA, as in Germany, milder conditions are offered on this score. Ted Eisenberg, Cornell University, New York:

Ted Eisenberg: Each state has its own lists of bankrupt property, which is not subject to sale. For example, a house or apartment - if they are no more expensive than the amount determined by local law. According to the rules of most states, jewelry is subject to sale. But at the same time, the debtor can leave a wedding ring or ring donated by engagement if it costs no more than $ 250. And in some states - no more than $ 1,000.

A bankrupt car is also not for sale if it costs less than 2.5 thousand dollars. They do not sell it even if the total price is up to 10 thousand, but I managed to pay only 2 thousand for the car. However, this is the average norms in the country. They vary from state to state.

Sergey Seninsky: In Russia, in the first three months of 2008, the total amount of consumer loans provided to individuals increased by 7.5%. And the share of overdue debts in the total amount of these loans increased by 3%...

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  Irina Lagunina

  Head of Special Projects of Russian Service Radio Liberty

  Laguninai@rferl.org