SIGNIFICANT MODIFICATIONS OF THE BANKRUPTCY AND LIQUIDATION PROCEEDING ACT

As of 1 July 2017, an amendment to the Bankruptcy and Liquidation Proceedings Act will enter into force, aiming at close the loopholes and consolidating the case law. The amendment clarifies the provisions on the disputing of the claim by the debtor and on the statutory requirements of the payment reminder to be sent by the creditor. The regulations on the option right and the transfer of rights and claims for security purposes will also be amended.

Furthermore, the rules of raising an objection in case of the measure or failure of the liquidator violating the laws will also be changed, for example, the deadline of the submission of the objection from 8 to 15 days. The amendment revises the rules of the action brought for the establishment of the liability of the directors of the company in case the directors have not acted with regard to the interest of the creditors and as such, the assets of the company decreased or the complete satisfaction of the creditors’ claims may be frustrated. The amendment also clarifies the conditions for exemption from the liability of the directors.

In addition to the amendment of the Bankruptcy and Liquidation Proceedings Act, other acts will also be changed such as the Stamp Duty Act and the Company Registration Act.