New Bankruptcy Act prompts over 15,000 bankruptcy motions

The application of the new Bankruptcy Act, which went into force on 1 September this year, has resulted in a surge of bankruptcy and insolvency proceedings, and until 30 November this year, a total of 15,277 bankruptcy motions were filed as against 2,492 in the entire 2014, according to figures provided to Hina by the High Commercial Court.

The spokesman for the court, Igor Perisa, explained that the application of the new Bankruptcy Act had triggered off "an exceptionally high number" of bankruptcy motions.

Thus, from 1 September to 30 November, 12,282 motions were filed with commercial courts for launching "summary bankruptcy proceedings" plus 1,653 motions for launching bankruptcy actions. The corresponding period in 2014 saw 305 motions for summary bankruptcy and 458 motions for bankruptcy actions, Perisa said.

Statistics for the period from 1 January to 30 November 2015 show that a total of 2,135 bankruptcy proceedings were concluded in that period, and an additional 1,549 files were either rejected or suspended.

The new law envisages that the state-run Financial Agency (FINA) has to launch bankruptcy proceedings for any business whose bank accounts have been frozen for more than 120 days and the second prerequisite is the failure of the business to pay salaries for three months in a row.

The new law also regulates the sale of the bankruptcy estate in no more than five rounds within a year.

According to some estimates, the new law should sort out the situation with nearly 15,000 non-active companies that have no employees and that have had their accounts blocked for a long time.

By the spring of 2016, bankruptcy proceedings should be launched against some 19,000 companies with 8,838 employees and with outstanding debts in the amount of 19.8 billion kuna.

By mid-2015, 19,646 businesses had their accounts frozen for more than 120 days, and of them 15,091 were no-employee businesses, while the remainder, 4,555, had 10,139 workers on their payrolls.

Last update: Mon, 21/12/2015 - 10:08

View the discussion thread.

More from Croatia

Minimum wage in 2017 set at HRK 3,276

The Croatian government on Thursday set the minimum wage in 2017 at a gross amount of HRK 3,276 and reduced the...

Croatian Gov't to set up commission to tackle totalitarian symbols issue

The Croatian government will set up a commission which will propose appropriate institutional and legal frameworks...

Croatian PM: Political stability, positive trends oblige us to implement reforms

The government's political stability and favourable macroeconomic trends offer an opportunity as well as impose an...

Vipnet taking over Metronet

Vipnet, a mobile network operator company, has acquired a controlling share in the company "Metronet...

Croatia's gross international reserves EUR 12.9 bn in 2016 June-end

Croatia's gross international reserves stood at 12.9 billion euros at the end of H1 2016, which was 5-6% or 800...