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How many companies are in bankruptcy due to amendments to the Bankruptcy Act?

The decision of the Constitutional Court from April 11, which initiates a procedure for assessing the compliance of Article 13, Paragraph 1 of the Act on Amendments to the Bankruptcy Act (NN No. 133/12) based on the proposal of Ingra, once again compels us to speak about the irresponsibility of state officials and employees after three weeks.

In issue 394 of Lider, we wrote about such irresponsibility after the Constitutional Court suspended the legal provision on the taxation of dividends at the proposal of HUP and ordered the Tax Administration to suspend the collection of that tax until a final court decision. And now, once again, the question of responsibility arises due to the obvious mistake of the person who wrote the amendments to the Bankruptcy Act, which the Parliament adopted on November 23, 2012, and which came into force on December 11, 2012.

The provisional nature of Ingra’s leadership has exploited the obvious mistake of the author of that law, as Article 13, Paragraph 1 states: ‘It shall be deemed that the creditor has made the existence of his claim probable if its existence is based on an enforceable or NON-FINAL court or administrative decision.’
Ingra’s legal experts immediately noticed the illogicality and reported it to the Constitutional Court, believing that such a provision prescribes a legal presumption because the creditor proves his claim based on a non-final judgment, which is contrary to the Constitution. Furthermore, they say in Ingra, the goal of litigation is not only decisions in accordance with the law, but they must also be in accordance with the principles of fairness (equality before the law) and justice (correct judgments of the specific case). Therefore, they consider it evident that the stated principles are not realized, ‘but rather only one side in the bankruptcy proceedings is inappropriately favored, while simultaneously significantly worsening the legal status of the opposing side.’ This means that the defeated party in a non-final judgment must be granted the right to appeal, which ‘guarantees that the appellant will not suffer irreparable harm until the higher court renders a final decision.’ Ingra believes that Article 13, Paragraph 1 denies the losing party in the first-instance proceedings the right to an effective appeal, which guarantees regular operations until finality, but also introduces legal uncertainty and unpredictability into the economic life of the country. Thus, it will enable ‘the opening of bankruptcy proceedings against legal entities whose debt has not been definitively established at all.’ The Constitutional Court has decided to suspend Article 13, Paragraph 1 of the Act until its final decision, thus bringing the actors in economic life into uncertainty for the second time in a few weeks, following HUP’s proposal against the taxation of dividends.

Unconstitutionality However, the Constitutional Court is not to blame for this because, no matter what anyone thinks of Ingra, this company is right here. It is truly unclear how the legislator could prescribe such a provision in the Act on Amendments to the Bankruptcy Act, thereby attaching that controversial provision to the valid Bankruptcy Act in Article 39 and making it, I am almost certain, unconstitutional. When we commented on the annulment of the provisions of the Act on the taxation of dividends, we said that practice shows that almost always when the Constitutional Court makes a decision to suspend a law until a final decision, that law turns out to be unconstitutional. It would be a real miracle if such a thing did not repeat itself in this case.
The question arises as to how many companies have already been pushed into bankruptcy due to such a probably unconstitutional provision and what will happen if (or when) the Constitutional Court declares the provision unconstitutional? Nothing, the wolf ate the donkey.

Abolition of bankruptcy and the public interest Ingra has responded to the article ‘Ingra with nine lives’ published in Lider No. 396. I will address this in the next issue (not in Justice for All), but I still believe that Ingra has nine lives. An example is the aforementioned decision of the Constitutional Court. Ingra here, as we have seen, referred to the public interest, but the real reason was the interruption of the procedure for determining the conditions for opening bankruptcy proceedings against Ingra, which was initiated by the company Međimurje High Construction. The temporary suspension of Article 13, Paragraph 1 of the ZID SteZ has also suspended that procedure, and the hearing scheduled for April 18 has been postponed. Namely, the Commercial Court in Varaždin has provisionally ruled that Ingra must pay Međimurje High Construction 6,186,328.69 USD, and based on such a non-final judgment, the Čakovec company has submitted a proposal for bankruptcy, which the contested ZID SteZ allowed them to do.

We invite entrepreneurs to present their problems. Following your writings, by pointing out the absurdities in individual cases, we will highlight the shortcomings of the system as a whole and thus support the readers of Lider as individuals in their unequal disputes with the cumbersome state administration.

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