Bankruptcy 2021 / Delovoy Peterburg business breakfast
The pandemic has aggravated an already difficult debt collection situation. There has been a boom in private bankruptcy, while the number of insolvent legal entities has declined. One of the pandemic anti-crisis measures declared a moratorium on initiating bankruptcy cases of systemically important enterprises and companies; however, some of them took advantage of this measure in their own interests. Judge of the Arbitration Court of St. Petersburg and Leningrad Region Ekaterina Mazurik explained that such cases can be brought to the court. Depending on the circumstances of the case, the court can lift the moratorium during the proceedings.
In most cases bankruptcy does not achieve the desired result. Creditors manage to recover only 5% of the debt, the business cannot be reanimated, and it isn’t possible to get debts fully repaid by the controlling persons by bringing them to subsidiary liability. As a result, some creditors just want to make the debtor nervous and resort to the services of lawyers with this request.
Andrew Bezhan, Counsel in the Dispute Resolution Practice of the St. Petersburg office of Borenius Russia, spoke about the role of trustees in bankruptcy proceedings, whether they can be controlled, how to control them and interact with most productively with them.