CEU Electronic Theses and Dissertations, 2016
| Author | Ivakina, Mariia |
|---|---|
| Title | Abuse of Individual Bankruptcy Laws: Can Russia Learn from the Experiences of the US |
| Summary | While contemporarily laws commonly known for bankruptcy proceedings designed for businesses, this is not the case in relation to the bankruptcy of individuals. Bankruptcy of individuals has not been adopted in many countries. Therefore there is no so much empirical material for those countries which are now introducing bankruptcy laws for individuals. One of the countries the experiences of which potentially could be resorted to is the US. The US Bankruptcy Reform Act of 1978 provides for both corporate and individual bankruptcy proceedings. The US case law supplemented and developed the implementation of this Act providing both positive and negative experiences of bankruptcy regulation. In 2005 there was an extensive reform with respect to the bankruptcy of individuals due to a dramatical increase of the number of individual bankruptcy cases and numerous abuses of individuals. Due to formal bankruptcy criteria individuals used bankruptcy proceedings for discharging from their obligations and debts even in cases when there was a chance to repay debts within a certain time period once there was a reorganization plan. Individuals have abused the system en masse by exploiting the overly technical rules of law. This trend "has fueled a debate in both Congress and the academy about whether and how the Bankruptcy Code should be amended to further restrict consumer debtors from discharging debt in chapter 7 when they could pay some or of that debt from future income in chapter 13." The debates resulted in the Bankruptcy Abuse Prevention and Consumer Protection Act which was passed by Congress in 2005. "The rationale for this legislation is the presumption that Chapter 13 leads to more appropriate outcomes compared with either Chapter 7 filings or other options outside bankruptcy." This Act plays an important role in the bankruptcy regulation and helped to decrease the number of individuals' abuses in bankruptcy. Due to 2008 global financial crisis some of the countries are now introducing or regarding the possibility of introduction of personal bankruptcy proceedings. Russia is one of the countries where the law on personal bankruptcy has been recently introduced and it came into force on October 1, 2015. One of the main issues which bothers the creditors in Russia and which is now on the table is how to prevent the individuals' bankruptcy abuse. Since the individuals' debt's threshold is not high, the creditors are afraid that the debtor will use the bankruptcy proceeding only to get discharge from his debts and obligations. The aim of the thesis is to learn from the experiences of the US on abuse of individual bankruptcy laws. For this purpose, I will analyze the US legislation and case law on abuse of individual bankruptcy laws and the appropriate provisions of the Russian law, including legal remedies which can be used in Russia for prevention of such abuse. |
| Supervisor | Tibor Tajti |
| Department | Legal Studies LLM |
| Full text | https://www.etd.ceu.edu/2016/ivakina_mariia.pdf |
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