The Verkhovna Rada has adopted the Code of Bankruptcy Procedures, which was co-authored by MP Ruslan Sydorovych from the Samopomich Union faction. The initiative was supported by 237 votes.
“Today, as a parliament, we have taken a huge step towards people to help them get rid of their debts; we have taken a tremendous step towards simplifying the bankruptcy procedures for legal entities; we have increased transparency and we have plugged a huge number of holes that were used by corrupt officials,” said Sydorovych after the voting.
He described this document as the most favourable in relation to people of all similar laws in the world. “An individual might get into a trouble because of a number of reasons, which are not necessarily exclusively due to financial difficulties; they might be because of loss of health, loss of work, even a divorce. People should be given a chance to do away with their debts.”
Thus, the new bankruptcy law allows restructuring the debts of individuals, even their mortgage lending. Sydorovych notes, “Foreign currency loans will be calculated at the rate that will be there at the time of launching the relevant proceeding in court. In addition to this, the amount that the debtor has already paid back before the consideration of the case in the court will be deducted from the amount of the debt that the debtor must pay.”
Sydorovych dispels the apprehensions about the possibility that creditors might take away people’s flats. “No one will is going to throw families out into the streets if they live in social housing and this is their only home.”
The co-author of the document says that banks also benefit from the adoption of this law, because they will finally dispose of toxic assets.
The MP continues, “As for legal entities. Presently, bankruptcy procedures can last up to 5 years, which does not let the economy restructure itself. This draft law provides for such a procedure for the sale of property that complies with the principle of “Prozorro”. That is, the property of bankrupt enterprises (we still need the decision of the Cabinet of Ministers for this, but the government is ready to help) will be sold through the Prozorro service.
Ruslan Sydorovych believes that the adopted law will not only let Ukraine get higher in the Doing Business rating; it will also let make the bankruptcy cases more efficient. At the same time, this will lead to the launch of the economy, will increase the number of solvent taxpayers.
The lawmaker adds, “It is impossible by definition to build a strong army, medicine, education, to provide people with pensions without a strong economy, without successfully operating enterprises.”