Lawyer, Head of Judicial Practice of NOBILI Law Firm Meshe Oleksiy
About the powers of the arbitral trustee in the debt repayment procedure
The Commercial Court rules on the recognition of an individual as bankrupt and introduces a procedure for repayment of debts and appoints an arbitration trustee – the implementation manager.
Repayment of the debtor’s debts is the last court procedure in the case, which is used to satisfy creditors’ claims through the sale of property of an individual.
The arbitral trustee in the case of insolvency of an individual enjoys all the rights of the arbitral trustee in accordance with the law, including the right to:
- Request and receive documents or their copies from legal entities, public authorities, local governments and individuals with their consent on the property of the debtor – an individual, including those containing confidential information and / or banking secrecy.
- Obtain information from state registers, including credit bureaus.
- To inspect the property of an individual.
- Receive information on the movement of funds on the accounts of individuals.
To ensure the performance of the powers of the sales manager of an individual, the arbitral trustee may engage other persons and specialized organizations on a contractual basis to pay for their activities at the expense of the individual, and in the absence of funds in the latter – on the basis of creditors’ meetings.
Permission to involve such persons is granted by the commercial court on the basis of a reasoned statement of the arbitral trustee on the need for their participation in the case, which indicates the amount of payment for their services.
In the debt settlement procedure, such an arbitral trustee may perform certain functions and have certain powers, namely:
- Organize the identification and compilation of a description of the property of an individual and an inventory.
- Determines the value of the property of an individual.
- Informs creditors about the place and time of creditors’ meetings and holds such meetings.
- Opens a special account for settlements with creditors.
- Carries out repayment of creditors’ claims accordingly at the expense of the means received from sale of such property.
- Reports to the commercial court and creditors’ meeting on the results of the sale of property of an individual.
- Performing functions of management and disposal of property of an individual.
- Carries out sale of property of the physical person.
- Has other powers in accordance with the law.
In case of removal of the arbitral trustee from office, banks that have a special account for settlements with creditors are obliged to transfer funds from such account to the account of a new arbitral trustee appointed by the commercial court to perform the powers of the restructuring manager.
It is also worth noting that the implementation manager receives a reward for exercising his powers. The amount of the basic monetary remuneration of the arbitration trustee for the performance of the powers of the sales manager is three sizes of the subsistence minimum for able-bodied persons for each month of performance of the arbitration trustee’s powers.
Creditors have the right to set an additional fee to the arbitration trustee at their own expense.
Lawyer, head of judicial practice
NOBILI Law Firm