On June 8, 2020, in the second reading, 307 deputies voted for the draft Law № 3322 "On Amendments to the Code of Ukraine on Bankruptcy Procedures (concerning the prevention of abuse in the field of bankruptcy for the period of measures to prevent the occurrence and spread of coronavirus disease (COVID-19)".
According to the explanatory note to the draft Law, its main purpose is to prevent a wave of bankruptcy, which may occur as a result of prolonged anti-epidemic and quarantine measures and falling economic activity of enterprises.
The first major innovation is to provide the arbitration trustee with the opportunity to hold a meeting of the creditors' committee remotely, in particular in the form of videoconferencing or a written survey. However, it is not yet clear how the mechanism for identifying creditors online will be implemented in practice.
The next significant innovation of Bill №3322 is the introduction of total moratorium.The Bill establishes a moratorium on the opening of bankruptcy proceedings against debtors - legal entities at the request of creditors on claims against the debtor, which arose from March 12, 2020.
The Bill also extends the period in which the debtor is obliged to apply to the commercial court with a request to initiate proceedings in the case if there is a threat of insolvency. Creditors have the right to suspend auctions for the sale of the debtor's property. Interest on the debtor's liabilities is also suspended if they are subject to a reorganization or restructuring plan.
The text of the Bill states that it enters into force on the day following the day of its publication.
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NAZALI TAX & LEGAL |