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An effective tool of mutual interests
The first to sue and recommend a bankruptcy commissioner to the court of law takes the lead. Other participants have to catch up.

As a result of recession, a significant number of companies have found that they cannot serve their obligations to the full.

Bankruptcy is the only civilized tool to balance the interests of both creditors and debtors in a state of insolvency. The bankruptcy procedure applies if interests of either side prevail.

Undoubtedly, an enterprise cannot become a bankrupt in a day, it takes years. It happens for various reasons and managers and owners are not always the ones to blame.

At the first signs or symptoms of a possible insolvency, bankruptcy should be prepared for in advance. It must be understood that we do not speak about creating simulated creditor indebtedness and other subterfuges.

On condition that a company fails to pay the claims immediately or within a reasonable period of time, the management should take into consideration the bankruptcy procedure as a guarantee of keeping the balance.

In Russia, being the first to sue is a key factor. The applicant introduces a bankruptcy commissioner to the court, which decides if the candidate is suitable and confirms the appointment. The risks are that the commissioner will work in favour of the applicant, not the balance. The question of who is the first to sue and to take the privilege to  recommend the candidate for a bankruptcy commissioner is closely connected to the issue of objectivity of the procedure.

The first to sue and recommend a bankruptcy commissioner to the court of law takes the lead. Other participants have to catch up. This condition does not depend on bails, deposits or, most importantly, the dominance in the total amount of the accounts payable. During the process of bankruptcy there is almost always competition between the creditors (for control of the debtor’s assets) and debtors (for security of their property). The chancas are the debtor might lose if the bankruptcy commissioner is an interestad person. The independence of a bankruptcy commissioner should be considered before the creditors file for bankruptcy to the court.

Some negative consequences during the monitoring procedure if an interested temporary commissioner is confirmed:
the need to inform the temporary commissioner about the company’s financial and business operations;
commissioner’s objections to demands on the docket which he does not approve; possibility of finding signs of deliberate bankruptcy with all the consequences in actions and omissions of debtor’s management (Criminal Code of RF, Art. 195, 196). The report of presence or absence of such signs is one of the commissioner’s duties;
temporary commissioner’s report might contain misinformation;
temporary commissioner has a right to appeal the debtor’s deals during monitoring period;
the need to obtain the temporary commissioner’s approval for major transactions;
obstruction to enter into a settlement agreement with the creditors;
delaying the hearing of cases (all the legal expenses, commissioner’s payment included, are paid with the debtor’s funds).

On and after the day of the procedure implementation all the arrests are removed, bailiffs’ powers are cancelled.

These are possible benefits for the obligor:
a respite from settlements with the creditors, including repayment of interest;
agreement with the creditors about amount and due date changes;
own bond discount purchasing;
the debtor's property purchasing priced below book value.
A Bankruptcy procedure may result in:
he sale of an enterprise as a property complex to a new legal person with the following liquidation of the debtor’s company. Creditors’ claims, unsatisfied due to the lack of debtor’s funds are considered paid (Clause 9 of Art 142 of the Federal Law "On Insolvency (Bankruptcy)";
entering into a settlement agreement on conditions of paying the debts in installments;
restoring the solvency and meeting the creditor’s claims;
paying the debts by the third party;
cancelling the procedure due to the lack of funds.

As experience shows, bankruptcy procedure is still widely used to obtain debtor’s assets.

As a rule, such actions are connected with creditors’ voting against the debtor, coordinated in advance, or buying claims on the docket. The aim of these actions is to sell an enterprise as a property complex as soon as possible or to enter into a settlement agreement with the creditors in favour of the latter.

Consequently, it is crucial to monitor the debts and possibilities to pay in order to keep control of assets. If creditors, whose interests go beyond debt collection, file the suit, their actions together with an interested bankruptcy commissioner might result in a loss of business, in spite of "friendly" accounts payable.

Despite being a separate and complicated branch of law, bankruptcy nowadays is the simplest and most effective tool of satisfying mutual interests.

The first to sue and recommend a bankruptcy commissioner to the court of law takes the lead. Other participants have to catch up.

A debtor as well as a creditor has a right (or rather, an obligation Art. 9 of the Federal Law "On Bankruptcy") to file the application to declare bankruptcy. In other words, to use bankruptcy to get protection from creditor’s claims.

The consequences of such actions may be illegal asset retirement, the sale of which could pay the debts, or formation of "controlled" payable accounts to gain control over the debtor’s bankruptcy.

Under these circumstances, it is crucial for the creditor to monitor and analyze the total debt in order to initiate debt recovery and introduce the bankruptcy procedure.

Furthermore, in the situation when the debtor cannot repay the claims on an instantaneous basis or within a reasonable period of time, bankruptcy is the only efficient enforcement tool.

There is little reason to rely on the enforcement proceedings as it has become a common practice to get protection through controlled bankruptcy. Since the establishment of the procedure, all the attachments are discharged and the powers of bailiffs are terminated.

It is of crucial importance to file the application to declare the debtor’s bankruptcy as soon as the court decision imposing debt payment comes into force. If the application is filed by the debtor or his creditor, the process of the enforcement becomes more complicated. For example, during the monitoring it can happen due to the following reasons:
the debtor or a creditor loyal to him has a right to assign an interested court-appointed trustee;
a court-appointed trustee may block the identification of the requirements, depriving you of the opportunity to influence the bankruptcy procedure;
a court appointed trustee will not ask law enforcement authorities to invoke the subsidiary responsibility of the owners and the debtor’s management.

Advocating for our clients’ rights which involves integrated implementation of legal instruments is almost always at the intersection of economics and law. It also involves applying to various state structures and often organizing their collaboration on border issues to the extent allowed by the law. All this is our job which we call bad debt recovery and the work in defense of rights.  

It is obvious that it is worth applying to declare debtor’s bankruptcy only when the debtor has assets, the sale of which can meet the claims. Our specialists will gather all the necessary information and will analyze the debtor’s assets before turning to courts. Moreover, after applying to declare debtor’s bankruptcy, managers and owners often find necessary sources to cover the debts. It is not surprising, as they can lose their business as a result of the procedure, in some cases they may be held personally accountable and financially liable, including criminal liability.

In some cases we can buy receivables from a debtor, which means the creditor will receive all the money back immediately (by taking into account any discount), while we do the work. In order to avoid such consequences it is important to present personally to the court the candidacy of the trustee for approval.
Bankruptcy law gives the trustee a right to involve experts for procedures enforcement. The list of trustee’s responsibilities is very wide and that is why each procedure requires the assistance of experts.

If you are the trustee and you have a need to involve experts, we will become a reliable and efficient tool for you. We have been in this business for many years. Without any doubts, it is impossible to streamline it due to the unique nature of each procedure. However, we have enough practice and a sufficient number of experts to offer the lowest cost price in the market, enough experience to ensure the highest quality, good reputation and manners to be reliable.

Customer Care Counseling provides consulting enterprises in subscription mode on non-standard business issues, including addressing legal issues.

It is because of unusual tasks that we are able to interact successfully with the legal departments of our partners, enabling them to focus on core activities. Cooperation is carried out on the basis of permanent contracts with our partners, many of such contacts lasting for years.

Signing the contract on Customer Care Counseling, an enterprise acquires all the expertise of the company, which can be used to solve conflicts, prevent aggression of third parties and in ensuring the legality of complex transactions, amongst others.

Subscriber principle of consultation involves constant participation of specialists of the Company in the economic activity of the client within their competence. However, as follows from our principles, we do not define the limits of competence and responsibility, and if there is a need to solve a related problem, we will never say it is not our business. Furthermore, we are constantly working on the prevention of potential threats to the client. The service of each client is carried out by a specialized project team, and if such a need should arise, other employees and the Company's management are involved to solve the problem. We provide an exclusively individual approach. Any customer problem, for solving which they employ us, is our common task.

Partners in the Subscription Agreement are our special value. Their legal protection and the ability to focus on issues of economic activity are partly our merit, which we are proud of.
Today bankruptcy is a separate, rather complex branch of law, and it is difficult to find the type of legal relations that does not include it.

 During the bankruptcy proceedings, we have accumulated extensive experience in the following areas:
complex support of mergers and acquisitions;
crisis management;
providing qualified management team in anticipation of bankruptcy;
represent the interests of the state and municipal bodies in the bankruptcy proceedings;
penalty in the executive production;
protection of the debtor in enforcement proceedings;
the invalidity of transactions;
land relationships;
registration of real estate;
organization of tendering on sale of property;
bidding on behalf of the buyer;
service provision of nominee shareholders and participants in the liquidation or bankruptcy;
participation in the prosecution of the debtor;
mediation, a mediator in the dialogue between the debtor and creditors.
If necessary, we will perform the work separately for each direction.