Draft changes in the Law of AR "On bankruptcy and collapse"

The Ministry of Economy and Industry prepared a draft law amending the Law of AR "On bankruptcy and collapse,” which includes mainly shortening of separate stages of the bankruptcy process.

The bill has been prepared pursuant to Presidential Decree "On additional measures to develop entrepreneurship" from March 3 this year.

In particular, it proposes extension of the current law to legal entities liquidated and suspended, which have debt accounts. The current legislation, as a subject of the law "On bankruptcy and collapse," means entities existing and operating in the past, as well as individuals.

Under the law, a preliminary meeting of creditors is held within one month after the entry into force of the bankruptcy by the court. It is envisaged to reduce this period to 15 days. At the same time they are notified of this within 14 days. If the parliament approves the proposal of the government, this period may be reduced by half. In this case the holding of this meeting is announced in the official periodical press twice, the last one 3 days before the meeting.

The property administrator will consider the claims of creditors no earlier than 10 business days (now - 30 calendar days). Register of complaints of creditors will be prepared not for four weeks, but for one week. The law requires the approval of the court registry. Going to court today, the appeal is sent no later than 7 days. It is proposed to reduce this period to 3 days. During this same period of time creditors will be notified of the results of performance of requirements on credits.

The law provides for a public auction sale of the debtor's assets. Proposes to add, under which specified maximum period of organization is not later than 30 days. Sum of the sale of assets will be payable by the auction winner not more than in 7 days , not 14 days as it is inscribed in the law "On bankruptcy and collapse."

This law Number 326 -IQ was adopted on 13 June 1997. Bankruptcy process in Azerbaijan is not often practiced. As a rule, companies are going to self-destruct to bypass trial. -08B-