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It Is Not the Same to Conduct Bankruptcy Proceedings for Small and Large Companies

How to objectively evaluate the work of people during the realization of their work tasks has always been a problem for private entrepreneurs, as well as for heads of public and state services. Among those whose work should be appropriately evaluated are bankruptcy administrators, who perform a rather sensitive job. In order to objectively assess their success at work, it is necessary to evaluate how much they are burdened during the realization of their task.

I repeat, it is not easy to set criteria, nor to objectively define the conditions under which bankruptcy administrators work, but it seems to me that despite this, a poor criterion for assessing their workload has been proposed by the Ministry of Administration and Justice. The Regulation on the Assumptions and Method of Selecting a Bankruptcy Administrator by Random Selection is currently in public discussion, and Article 12 states that their workload is ‘determined as the sum of the weight of the proceedings assigned to the bankruptcy administrator registered on the list of bankruptcy administrators for the area of each commercial court.’ It will be much clearer to you below as it further states that the bankruptcy administrator’s workload increases in accordance with the assigned weight of the proceedings. So far, nothing is disputable, but the problem arises because the basic criterion is the type of proceedings. Namely, it depends on it how heavy a bankruptcy proceeding assigned to the bankruptcy administrator will be.

They do not ask those who know

For example, a bankruptcy administrator in a proceeding for burden receives one point, regardless of how large the company or financial institution in bankruptcy is. Furthermore, one point is also awarded to the commissioner in the pre-bankruptcy proceeding, while the temporary bankruptcy administrator in the previous proceeding and the bankruptcy administrator in the open proceeding of subsequent division receive 0.3 points for their burden. All others are not recognized at all for their burden (the bankruptcy administrator in the shortened bankruptcy proceeding, as well as in the personal administration proceeding and in cases where the open bankruptcy proceeding is not conducted), so they have no points. Additionally, the weight of the proceedings for the bankruptcy administrator selected from the list of highly qualified bankruptcy administrators is determined equally for each proceeding – one point.

And again, it seems to me that the writers of the regulations do not ask or very little ask those most concerned – in this case, the bankruptcy administrators. Because while you read that Article 12, you must ask yourself how it can be the same to conduct bankruptcy proceedings for small and large companies. And here, the basic criterion is the type of proceedings, i.e., whether it is a bankruptcy proceeding led by a bankruptcy administrator or, for example, a temporary bankruptcy administrator in the previous proceeding, regardless of the size of the company. What kind of assessment of the task’s weight is that?! Therefore, it seems to me much more reasonable the proposal of one bankruptcy administrator who believes that the weight of the proceedings, i.e., the workload must be evaluated differently. He also points out the illogicality in the proposal of the Regulation of the Ministry of Justice and Administration because he says, if such a regulation is accepted, ‘the bankruptcy administrator who conducts the bankruptcy proceedings of a bank has the same workload as the bankruptcy administrator who conducts the bankruptcy proceedings in which he needs to sell an old car.’

Unacceptable model

He adds that such a model of workload is unacceptable and that it must be defined ‘by the status of the entrepreneur in accordance with the Accounting Act or the amount of assets determined at the general examination hearing.’ Therefore, he proposes that for the bankruptcy proceedings of micro-entrepreneurs, the burden should be assigned 0.5 points, and one point for the bankruptcy proceedings of small entrepreneurs. The bankruptcy administrator would receive two points for the bankruptcy proceedings of medium-sized entrepreneurs, and for the bankruptcy of large entrepreneurs, three points. For the bankruptcy proceedings of a bank, he proposes five points, and according to the type of entrepreneur, he proposes the same scoring for commissioners of pre-bankruptcy settlements.

I will not enter into whether such scoring is good or not, but, I repeat, the proposal of that bankruptcy administrator is much more logical than the one sent for public consultation by the Ministry of Justice and Administration.

 

POST SCRIPTUM

Bankruptcy administrators often take over the proceedings when the company is already deeply in trouble, and as a result, bankruptcy proceedings are less successful than they would otherwise be if entrepreneurs had accepted such a scenario earlier. A good example is the former Pevec. Bankruptcy administrators told me that this company was no better than others that went bankrupt, but for bankruptcy administrator Darko Šket, the job was easier since it filed for bankruptcy on time.

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