The procedure in the law under study involves several steps, according to the situation of the debtor (natural or legal) and the level of ability to meet its economic and financial obligations. Bankruptcy Both the debtor and any of his creditors (who hold a debt minimum to 50 minimum wages), can request the bankruptcy of the person (natural or legal) who owes in the specialized court that was created by this law. This bankruptcy application must be based on one of the predefined conditions:
Breach of payment obligation, expired 90 days of its enforceability. For this condition to be applicable there must be recorded evidence of prior intimation to payment by the Creditor.
When the current liabilities exceed current assets of the company for more than 6 months.
Failure to pay any tax liability by more than six tax installments.
Nonpayment of two or more consecutive salaries to employees in corresponding dates.
Concealment of the administration of the company or if it remains vacant for a reasonable period without designating a representative to administer.
By order of the closure of the premises of the company, in case of concealment or absence of managers, or the partial or total transfer of assets and rights to a third party for distribution among creditors.
Making intentional, fraudulent, criminal conspiracy, breach of trust, forgery, and simulation or cheating on their obligations.
Notice to creditors of the suspension of payment, or intention to stop payment of debts.
The existence of restructuring, bankruptcy, insolvency or suspension of payments in a foreign country where the parent business of the company or individual debtor is located.
Existence of executive or real estate embargoes affecting the total assets in more than 50%. The existence of rulings or judgment enforcement processes, which could affect the total assets in more than 50%.
After receiving the application for bankruptcy by the debtor or creditor, the court appoints a Verifier, whose aim is to verify and report to the court on the debtor’s financial situation.
Perhaps, the most important aspect is the procedural stage in which the company or individual debtor is observed and limited in his decisions and operations. In fact, Article 38 of the law states that from the time the debtor is notified of the bankruptcy application, or he deposits it in court, both the Verifier and the court should be informed of any act performed by the debtor:
Modification of bylaws or constituent acts;
Mergers, takeovers or divisions in detriment of assets;
Constitution or execution of guarantees on assets and rights;
Reconciliations or transactions on obligations;
Agreements with creditors outside cases provided by law;
Compensation, payment arrangements, waivers, embargoes, unilateral or mutual agreement processes ongoing obligations or terminations;
Transfer of assets or rights outside ordinary operations.
Within 15 days of the appointment of the Verifier by the court, he must issue a report, which describes the debtor’s situation and verifies that they have met all the conditions required by the law for filing the deposited bankruptcy request. It is important to highlight that this report presented before the competent court is the first formal recognition of the credit balances have been checked and certified in this first stage of the process.
Through the report, the Verifier should recommend to the court whether or not the opening of a bankruptcy of the company or individual debtor should proceed or if it is appropriate to directly proceed to liquidating it. It should be noted that the court should consider the defense the debtor can present, if the bankruptcy has not been requested by him.
Another aspect of great importance is the time in which the process is made public. This aspect is of particular interest for creditors who have not become aware of the opening of a bankruptcy by the debtor, or who have not been determined and accordingly recorded in the report issued by the Verifier.
The process is made public through the issuance of an irrevocable ruling that welcomes or rejects the request for bankruptcy in court, which must be published and extended an invitation to all the creditors of the debtor for them to participate in the process of recognition of their claims.