Uzbekistan simplifies the bankruptcy procedure

Tashkent, Uzbekistan (UzDaily.com) -- President of Uzbekistan Shavkat Mirziyoyev signed a resolution “On simplification of bankruptcy procedures and radical improvement of the activities of judicial managers” on 1 February.

The document notes that from 1 July, Uzbekistan introduces an order according to which the state tax service bodies apply to the court for declaring the debtor bankrupt no later than 30 days from the date of return of the executive documents due to the impossibility of collecting the tax and other mandatory debts payments.

The resolution states that the court may initiate a bankruptcy case if the amount of claims against the debtor - a legal entity in the aggregate is at least 300 times the minimum wage, and against the debtor - an individual entrepreneur or an individual, who has lost the status of an individual entrepreneur - not less than 20 times the minimum wage if there are signs of bankruptcy.

The deadline for liquidation proceedings may not exceed nine months. At the same time, the court may extend the period by three months, on the basis of the petition of the persons participating in the bankruptcy case.

The resolution notes that a court verdict that has entered into legal force on establishing signs of false bankruptcy, concealing bankruptcy or deliberate bankruptcy as a result of joint actions of beneficiary and affiliated persons serve as ground for bringing such persons to subsidiary liability in the manner prescribed by law.

The property of debtors, to whom bankruptcy procedures have been applied, is to be realized by court managers through an electronic online auction on the E-IJRO AUKSION single electronic trading platform, the document says.

From 1 May, the head of Uzbekistan canceled the procedure for appointing judicial managers from among the employees of the state tax service bodies during simplified bankruptcy proceedings instituted by the state tax service authorities.

Also from 1 May, an order is introduced in accordance with which, when carrying out simplified bankruptcy procedures instituted by the state tax service, the court managers are appointed to have a fourth category court certificate and should be members of the Association of Court Managers.

The court manager is paid remuneration in the amount of 20 minimum wages for each completed liquidation proceedings at the expense of the state budget on the basis of the decision of the tax inspectorate of the district (city) at the location of the debtor.

When debts on taxes and other obligatory payments are collected, the judicial managers receive additional remuneration in the amount of 5% of the amount of the outstanding debt.

Attorneys, who have license in the specialization “civil and economic legal proceedings” and received a certificate of a judicial administrator. will also be able to serve as the court managers.

The President instructed by 1 March to submit to the Legislative Chamber of Oliy Majlis a draft law providing for increased responsibility for false bankruptcy, concealment of bankruptcy and deliberate bankruptcy.

The Head of State ordered to draft a law on Bankruptcy in a new edition by 1 May 2019.