Changes to the Insolvency Law: The Ministry of Justice wants to prevent abusive bankruptcy and improve tax recovery

The Ministry of Justice, in collaboration with the Ministry of Finance and with the National Agency for Fiscal Administration, has elaborated a set of proposals to amend the Insolvency Law no. 85/2014, to be included in the second package of reforms, which will be finalized in the next period.

MJ has a set of proposals related to the Insolvency Law. Photo inquam Photos / Geroge Calin

“Insolvency legislation It is essential for the functioning of the business environment. Insolvency procedures ensure the ordered liquidation or restructuring of enterprises or entrepreneurs in financial and economic difficulty, and their balanced regulation, taking into account all rights and interests in the competition, is defining for evaluating investment risk and for creating a healthy and credible economic climate. Of these reasons, the objective of efficient insolvency and insolvency prevention procedures has been permanent to the attention of national authorities”, The Ministry of Justice said in a statement sent on Thursday.

According to the Ministry of Justice, the functionality and efficiency of insolvency and insolvency prevention procedures have also been evaluated in the context of the multidimensional analysis of the factors that influence the evolution of the budget policy.

Attracting the responsibility for the legal administrators who, by the mode of administration, willingly introduce SMEs in insolvency

As a result, in the national budgetary-constructional plan in the medium term 2025-2031, within the reform of the administration of the tax and tax system, the measure “is provided”The updating of the insolvency specific legislation, with the objective of reducing the VAT GAP, by creating the legal framework for attracting the responsibility for the legal administrators who, by the way of administration, willingly introduce the SMEs that owe taxes and taxes and then bankruptcy the SMEs that have the ratio between the debts to the budget and the total assets higher than 50%, “ is shown in the statement.

“In this framework of evaluation and action, a legislative intervention is taken into account for the efficiency of the procedures regulated by the Insolvency Law no. He looks Ministry of Justice.

Solutions proposed in the draft law

In the draft law that will be promoted in the next period, solutions are proposed to achieve the objectives set in the national budgetary-structural plan:

1. Consolidation of the regime of responsibility of the administrators for bringing the company to insolvency. For this purpose, they are proposed:

• stricter requirements for elaborating the report of evaluation of the state of the debtor and the causes that led to insolvency, to facilitate the creditors, including the fiscal creditor, the foundation and triggering the action under the administrators;
• The action in liable no longer concerns only the formal administrators, but also the de facto administrators (who impose the financial and operational decision of the company);
• the prohibition to found companies for a period of 5 years, as an effect of the decision to attract liability, a prohibition that is registered in the trade register, the information being thus accessible to the public;
• extending the prohibition of occupying the administration/management function and the de facto administrator;
• The de facto administrator and administrator against whom an action has been introduced in attracting the liability cannot have the quality of special administrator;
• regulating a distinct case of attracting liability: selling goods as an independent assembly to affiliates in creditors' fraud;
• The establishment of a presumption according to which the non -submission of financial statements and fiscal statements presupposes, until the opposite proof, the failure to, according to the law, of the accounting.

2. Increasing the degree of recovery of taxes and taxes that belong to insolvency companies, by ensuring a higher level of transparency in relation to creditors, in order to facilitate the exercise of procedural remedies against voting and delaying tendencies. For this purpose, they are proposed:

• the establishment of the obligation of the debtor/judicial administrator to present the thorough reasons and the exceptional circumstances that can justify the prioritization of certain current claims, as an exception from the principle of payment of current debts, according to due;
• The notification of the fiscal creditor regarding the intention to open the procedure will be made by the debtor 15 days before the application is submitted;
• Electronic communication of reports and reorganization plan to all creditors requesting;
• more detailed updated reports of the judicial administrator/judicial liquidator;
• Including additional information in the debt table;
• clarification of the obligations of the agreement administrator in the elaboration of the list of debts in accordance;
• defining the concept of affiliate (persons closely related to the debtor), within the meaning of the insolvency law;
• limited number of creditors affiliated in the Creditors Committee (1/7).

3. Reduction of the duration of the insolvency procedure, through concrete measures, with immediate effect. For this purpose, they are proposed:

• The periodic verification by the judicial administrator of the financial state of the debtor, to propose, immediately, if applicable, the bankruptcy, during the observation period or during the execution of the plan;
• capitalizing on the goods by public auction, according to the Civil Procedure Code, if the sale, according to the sales regulation established by the creditors, does not lead to the sale of the good within a certain time;
• Closing the insolvency procedure with the finding by the syndic judge of fulfilling all the payment obligations assumed by the confirmed plan, even if there are one or more current debts, which are not certain, if their cumulative amount is not likely to determine a state of financial difficulty or to generate the imminence of the insolvency the competent court, according to the common law);
• Development and operationalization in a priority regime of a computer platform for the random designation of the judicial administrator by the syndic judge;
• completing the duties of insolvency practitioners, to encourage the rapid and efficient closure of insolvency procedures.