ECONOMY

Bankruptcy reform due this summer

bankruptcy-reform-due-this-summer

The Finance Ministry is about to complete the drafting of the new bankruptcy code that will allow for the speedy bankruptcy of households as well as businesses. The bill will allow them to be relieved of their debts, offering them a second chance once their entire set of assets has been liquidated.

The new draft law, which is expected to replace the Katseli law with the protection of borrowers’ main residence, will need to be agreed with the banks and the country’s creditors in the next couple of months.

The objective is for the final text of the bill to be voted into law during the summer and for it to start being implemented as of early 2021, after the containment of the economic crisis from the coronavirus.

The recent refusal by the creditors to accept an extension of the protection of main residences is spurring the government’s plans for the timely preparation of the bill.

The bill’s main feature will be the absence of main residence protection, which will be counterbalanced by the swift write-off of debtors’ remaining dues after the liquidation of all their assets.