MOSCOW, April 21 The Cabinet of Ministers of the Russian Federation approved a bill to expand the out-of-court bankruptcy procedure for citizens, the press service of the Ministry of Economic Development reported on Friday.
The relevant bill was considered at a government meeting on Friday.
«Today, at a government meeting, a bill was supported to expand the out-of-court bankruptcy procedure for citizens,» the ministry said in a statement.
As First Deputy Minister of Economic Development Ilya Torosov explained, the bill will allow citizens to use the out-of-court bankruptcy procedure if more than one year has passed since the presentation of the writ of execution. «This applies to citizens whose only income is a pension, and they do not have property that can be foreclosed, or they are recipients of a monthly allowance in connection with the birth of a child,» he explained.
According to him, the right to out-of-court bankruptcy will also be given to citizens in respect of whom enforcement proceedings have been ongoing for seven or more years. In addition, the bill proposes to raise the threshold for out-of-court bankruptcy from 500,000 to 1 million rubles, and lower the minimum threshold from 50,000 to 25,000 rubles.
In 2020, Russia simplified the system of bankruptcy of citizens, providing individuals and individual entrepreneurs with the opportunity to file an application for declaring them bankrupt out of court at the MFC free of charge. The amount of their monetary obligations must be at least 50 thousand rubles and not more than 500 thousand rubles. This system allows citizens to go through the bankruptcy procedure without the participation of the court and the financial manager.
Economic Development Minister Maxim Reshetnikov proposed last year to expand the existing mechanism, and Russian President Vladimir Putin subsequently gave corresponding instructions.