Debt relief only after complete asset liquidation
Debtors will enjoy total relief from their debts to banks, the state and other creditors 24 months after they file for bankruptcy and 12 months after the actual bankruptcy comes to a close, provided they have had all their assets liquidated after a court decision, according to the new bankruptcy code blueprint Kathimerini has seen.
The government’s aim is for the new framework, which sets common rules and procedures for the bankruptcy of corporations and individuals, to be ready in the next couple of months. It will replace the Katseli law, the main residence protection status and the clauses about the bankruptcy of enterprises.
For households, the new code aims to put an end to the time-consuming bankruptcy procedures that currently apply through the Katseli law that can last up to 15 years.
As the new bill will be stricter than the existing framework, providing for the liquidation of all assets before debt relief, the government aims to secure the swift approval of its creditors so that it can be finalized quickly and an end can be put to any expectations of a more lenient framework.