BANKRUPTCY OF INDIVIDUALS: RUSSIAN AND FOREIGN EXPERIENCE.

Author:Vinogradova, Marina V.
Position:Report - Abstract
 
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INTRODUCTION

Bankruptcy of individuals is a fairly new procedure in the civil law of Russia, designed to protect the rights and legitimate interests of economic entities and aimed both at satisfying the claims of creditors, and at meeting the interests of the debtor.

Increasing the effectiveness of bankruptcy procedures for individuals requires special legal regulation and associated changes in the education programs so that future specialists could make independent decisions on bankrupt enterprise development (Harrington & Maysami, 2015; Sukavejworakit et al., 2018)

The bankruptcy of individuals in Russia is regulating by Federal Law (O nesostoyatel'nosti (bankrotstve)), in the application of which problems arise that require a search for a solution, including on basis of using foreign practice of bankruptcy of citizens.

Modern scientists pay enough attention to issues of bankruptcy procedures for legal entities. In most cases, the international scientific community examines the problems associated with the practice of collecting unsecured debt and the rights of an unsecured creditor in the order of debt collection and lack of collateral (Antia et al., 2017; Athreya et al., 2012). Also researchers are engaged in problems of franchising within the financial issues of lack of funds for the development of the franchising network and disputes between the franchisor and the franchisee (Antia et al., 2017). The relevant of the research topic is mortgage in the framework of macroeconomics, social and migration policy (Charters et al., 2016), the methodology of the bankruptcy process, including undue bankruptcy (Jenkins & McKelvie, 2016; Pasekova et al., 2016; Von-Stumm et al., 2013), the effectiveness of legislation and its relevance to the current situation with physical bankruptcy (Azmi et al., 2017; Fu et al., 2018). Including issues of debt financing (Domino, 2017; Kumar & Vig, 2017) as well as general issues of bankruptcy of legal entities, procedures for recognizing and collecting money (Chen & Zhao, 2017; Ivanchev, 2017; Lawless & Warren, 2012).

In the past few years, scientists have raised the issue of regulating the bankruptcy of individuals. So, first of all researchers make analysis of legal documentation, among which one can underline research by (Vitryanskiy, 2015), as well as works on the procedures for the recognition of a debtor citizen bankrupt (Tkachev, 2008). Bankruptcy is a legally defined procedure conducted over the property of debtors for settlement with creditors. It is a path for business entities with poor business results to further economic performance (Dessie, 2015).

By regulating bankruptcy offences, a legislator indicates the importance of protecting creditors and adjudicated bankrupts before and during the bankruptcy proceedings (Bachvarova, Margarita, 2016).

But at present, as Alferova notes, the principle of regulating the bankruptcy of individuals is constantly changing along with the increase in cases of bankruptcy of individuals, which requires both detailed economic and legal study (Alferova, 2017). The authors of Betti and Lemmi propose the application of decisions on individuals individually, since this procedure has its own peculiarities and depends more on the economic component, which, if the rules of law are tighter, can lead to negative consequences for society (Betti & Lemmi, 2013). And as for all researches, it is important to research international experience of regulating the bankruptcy of individuals, in particular the United States of America, which according to national legislation is referenced in the research of Hermann (2017). Variability of political value commitments is reflected within many deep transformations of bankruptcy regimes in the legal evolution of most national jurisdictions. The evolution of bankruptcy laws proves by its alternation of ideological changes the deep political dimension of bankruptcy regulation (Lomfeld, 2017).

This problem of regulating the bankruptcy of individuals now generates a large number of questions, and has been insufficiently studied and elaborated. The creation of a legal framework without gaps and conditions for the functioning of the mechanism for the recognition of individuals as a bankrupt represent the most important prospects for the development of an insolvency institution.

The system of Russian legislation is crucial to the improvement of legal policy affecting legal life, as well as the formation of lawful behavior as a value of public relations in banking, and an unconditional priority of the principle of legality, showcased in the system of financial law principles (Pastushenko, 2018).

Nonetheless, the relevance of the problem posed is due to a number of macroeconomic factors. Primarily, experts note that in Russia in 2008-2010, there was an economic crisis that was part of the global crisis, then in 2014-2015 there was a sharp decline in the exchange rate of the Russian ruble relative to foreign exchange, associated with a decline in world oil prices and economic sanctions were imposed on Russia in connection with the aggravation of international relations and the political situation in Ukraine (Alekseyev, 2016).

These specified economic crises led to a decrease in real incomes of the population, an increase in unemployment, which, combined with relatively high lending rates of commercial banks, led to an increase in the credit debt of the population. Often, the bankruptcy procedure for the debtor is the only way to get rid of the excessive credit burden and "brand new life'". Carrying out of procedure of bankruptcy for the creditor is the only lawful way to return the means or at least their part. Analysts say that in a number of regions of Russia there is an aggravation of the situation with retail loans, the debt of the population is increasing, which can result in mass refusal of citizens to fulfill credit obligations. Such a situation can lead to a systemic financial crisis (Sholokhova, 2016). In this connection, the issues of improving the legal regulation of the bankruptcy of individuals taking into account the world experience of conducting bankruptcy...

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