ATTORNEY ADVERTISING. Prior results do not guarantee a similar outcome. White & Case LLC 4 Romanov Pereulok 125009 Moscow Russia + 7 495 787 3000 + 7 495 787 3001 Amendments to Insolvency Law March 2015 ClientAlert Financial Restructuring and Insolvency In December 2014, amendments were introduced to the Federal Law “On Insolvency (Bankruptcy)” No. 127-FZ, dated 26 October 2002 (“Insolvency Law”).
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28 June 2013 the Russian President signed Federal Law No. 134-FZ amending a number of laws in relation to combating illegal financial operations.
The Law amended, in particular, the Law on Banks and Banking Activity, the Anti-Money Laundering Law, the Criminal Code and the Code of Administrative Offenses, the Law on State Registration of Legal Entities, the Bankruptcy Law, laws regarding certain financial organizations, and the Tax Code. Below is a summary of the key changes (save for those made to the Tax Code).
New Law on "Amendments to the Law on Insolvency (Bankruptcy) and Articles 17 and 223 of the Arbitrage Procedural Code with respect to establishment of special rules for bankruptcy of developers attracting money from participants in construction" was adopted on July 12, 2011 (the "Amendments"). Most of the Amendments were introduced as a special chapter No. 7 named "Bankruptcy of Developers" into the Federal law on Insolvency (Bankruptcy) No. 127-FZ as of 26 October 2002 (as amended) (the "Bankruptcy Law").
On 19 August 2011, the Ministry of Economic Development of the Russian Federation published on its official website a draft order on establishing the procedure for entering information on bankruptcies in the Unified Federal Register (the "Order").
Specifically, the Order:
- INTRODUCTION
A simple, clear and effective insolvency regime is a vital element in attracting both domestic and foreign investment in a jurisdiction like Russia. To be effective, an insolvency regime has to balance the interests of various classes of creditors, as well as the interests of creditors generally in relation to other interested parties, such as shareholders or participants. An insolvency regime is expected to give the debtor an opportunity to discharge its obligations and continue its business activity.
Bankruptcy
On March 5, 2012, new rules came into force for credit cooperatives in bankruptcy proceedings; the new rules feature:
On 30 July 2012, the Presidium of the Supreme Commercial Court of the Russian Federation (the “SCC”) released its Review of rulings of the Presidium of the SCC (the “Review”) on major issues of private law for June 2012. In particular, the Review highlights that in bankruptcy proceedings a creditor’s claim upheld by an arbitration ruling may be included in the list of creditors without a writ of execution.
Circumstances of the case
On 10 August 2012, the Supreme Commercial Court of the Russian Federation (the “SCC”) published a decree clarifying disputes relating to suretyships (the “Decree”). The Decree has not been significantly amended since the draft was published in February 2012 and analysed in the March edition of the Legal Digest.
We would like to note several important positions included in the SCC’s Decree:
On 30 July 2012, the Presidium of the Supreme Commercial Court of the Russian Federation (the “SCC”) released a Review of its rulings of the Presidium of the SCC on major issues of private law for June 2012. In particular, the Review indicated that during bankruptcy proceedings, a creditor’s claim upheld by an arbitration ruling may be included in the list of creditors without a writ of execution.