Bankruptcy: Mitigating Risks for both the Creditor and the Debtor

In November 2009, Corporate Bankruptcy: New Rules of the Game, a special supplement to the magazine Corporate Lawyer, was published. The supplement was prepared jointly by lawyers from Pepeliaev Group and bankruptcy experts.

Bankruptcy proceedings represent first and foremost a legal institute that enables the debtor to exit the business with dignity and the creditor to receive compensation in accordance with effective legislation.

Lawyers from Pepeliaev Group considered the issue of bankruptcy comprehensively, from the perspective of various branches of law: corporate, commercial, banking, labour and employment, tax and international law; and also the protection of IP rights and legislation on land, real estate and construction.

After analysing the institute from the aspect of challenges to the debtor’s transactions, with due account of the innovations introduced by the Law “On Insolvency (Bankruptcy)”, the firm’s lawyers performed a legal evaluation of the innovations in terms of protection for creditors, namely, the procedure for holding jointly and severally liable the persons controlling the debtor, if the debtor’s property does not suffice to settle creditor claims.

In the supplement you will find an expert evaluation of the most recent amendments to bankruptcy legislation by the head of a self-governing organisation of court-appointed administrators.

The supplement also considers topical issues relating to the bankruptcy of credit institutions.

Real estate specialists identify a number of latent risks associated with a debtor’s property. During the bankruptcy of a debtor, creditors should not forget such assets as intellectual property, which can be used to settle their claims.

Tax specialists talk about the specifics of bankruptcy proceedings instituted by the Russian tax authorities and potential defence strategies.

You will also be able read articles in the supplement on M&A transactions, which can serve as an alternative to bankruptcy at a time of insolvency.

The supplement also considers the employment relations between the employer and employees during bankruptcy proceedings.

Successful attainment of the stated objectives in a bankruptcy is dependent on how well the parties know their rights and how closely bankruptcy specialists cooperate with industry lawyers.

We hope that the attached materials provided for your consideration will prove useful to you and will help you gain an insight into the legal aspects of bankruptcy and how a business can mitigate its potential losses.

Our specialists are ready to answer any questions that you might have.

If you would like to receive a full version of the supplement, please e-mail a written request to Anna Konovalova at the following address: a.konovalova@pgplaw.ru.