The moratorium on bankruptcies and foreclosures in Russia has ended

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The moratorium on bankruptcies and foreclosures in Russia has ended
The moratorium on bankruptcies and foreclosures in Russia has ended
3 October, 15:18EconomyPhoto: yakutsk.arbitr.ru
In Russia, the semi-annual government moratorium on bankruptcies, introduced from April 1, has been completed. From October 2, creditors can again demand the initiation of insolvency proceedings against their debtors.

According toInterfax , citing data from the Federal Tax Service (FTS), the last day of the moratorium was October 1.

From 0000 hours Moscow time on October 2, 2022, the Unified Federal Register of Legally Significant Information on the Facts of the Activities of Legal Entities, Individual Entrepreneurs and Other Economic Entities "Fedresurs" resumed the possibility of publishing notifications of creditors about the intention to apply to the court to declare the debtor bankrupt.

A moratorium on such actions was introduced this spring by government decree No. 497 after the start of a special military operation ( SVO ) on the territory of Ukraine.

Previously, a similar moratorium was introduced in the country in connection with the coronavirus pandemic in 2020. However, then it extended to companies from the industries most affected by the pandemic. The new moratorium applied to almost all firms, individual entrepreneurs and citizens. An exception was made for troubled developers .

The peculiarity of the moratorium was that, along with a ban on bankruptcy at the initiative of external creditors, it “froze” enforcement proceedings on penalties that arose before its introduction. The authorities prohibited the imposition of any financial sanctions for the late repayment of debts that arose before its announcement, even in cases where the debtor companies did not show any signs of bankruptcy.

This situation caused numerous complaints from non-paying counterparties, and especially from consumers who were faced with the purchase of substandard goods and the provision of unscrupulous services. Violating companies received the right not to execute with impunity the decisions of the courts on the payment of penalties, fines and compensation for non-pecuniary damage to citizens and organizations for the protection of consumer rights for violations.

At the same time, Decree of the Government of the Russian Federation of March 23, 2022 N 442 “On establishing the features of the transfer of an object of shared construction to a participant in shared construction”, which cancels fines and penalties for negligent developers, continues to be valid until the end of this year. Thus, while in the Russian Federation not all moratoriums that were introduced against the backdrop of SVO have been completed.

The essence of the second moratorium is that the government has temporarily canceled on the territory of the Russian Federation the operation of Article 330 of the Civil Code of the Russian Federation and Art. 13 of the Federal Law "On Protection of Consumer Rights" on the collection of penalties and interest for developers who delay the process of putting houses into operation.

The moratorium was introduced despite the fact that, by law, negligent developers are required to pay compensation to equity holders for each day of delay. In fact, the second moratorium has become one of the measures of state support for the construction industry. But experts note that its peculiarity lies in the fact that the financial costs of the implementation of the measure the government laid not on the state budget, but on the shoulders of homebuyers and socially oriented NGOs that protect the interests of consumers.

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