INSOLVENCY PRACTICIONER OFFICER
The Managing Director of our firm, FRS Audit Services Ltd, Mr Antonis Zapitis has recently succeeded in the first examination that took place under the new framework for Cyprus insolvency practitioners.
The Insolvency Framework comprises of a total of six laws/regulations which entered into force on the 7th of May 2015, the date of their publication in the Official gazette of the Republic and they comprise of the below legislation:
- Insolvency of Natural Persons (Personal Repayment Schemes and Debt Relief Order) Law of 2015
- Bankruptcy (Amending) Law of 2015
- Companies (Amending) Law (No.3) Law of 2015, regarding liquidation
- Companies (Amending) Law (No.2) Law of 2015, regarding a mechanism for restructuring corporate debt (Examinership)
- Insolvency Practitioners Law of 2015
- Insolvency Practitioners Regulations of 2015
The first two laws are for physical persons whereas the third and fourth law is for companies. The fifth law and regulations regulate the profession of Insolvency Practitioners.
It is pointed out Under the new Insolvency framework, a person can act as a liquidator, provisional liquidator, receiver, administrator or examiner (regarding companies) or as a bankruptcy administrator, provisional receiver and/or consultant on related matters (regarding physical persons), only under the condition that he/she meets the criteria according to the provisions of the Insolvency Practitioners Law of 2015. Among the minimum requirements, an insolvency practitioner must be a member of an authorized professional association and must have proved his/her professional competence (university degree, relevant working experience etc.),and must have successfully completed the written examinations that took place last October 2015.
Why was the Insolvency Framework set up?
- For the assistance to create appropriate incentives for repayment of debt, thus contributing to a significant decrease of non-performing loans.
- To safeguard, the primary residence, under strict eligibility criteria.
- To provide for a second chance for a new start of a bankrupt person so that he/she can be join again in the economy and our society.
- To set up a new mechanism aiming to provide of relief to debtors, with little unsecured debt with no assets and no income, who cannot file for bankruptcy according to the current laws (due to the low amount of their debt).
- For the provision of incentives for the rescue and rehabilitation of companies to afford viable companies the opportunity to reduce indebtedness and preserve jobs, while maximizing the value as a going concern for the benefit of creditors.
- The modernization of laws regarding the liquidation of companies and bankruptcy for natural persons, so that the liquidation procedure becomes speedier and more efficient.
Licensed insolvency practitioners must be members of a recognised professional body which has appropriate practice rules specifying the matters to be taken into account in deciding whether a person is fit and proper to act as an insolvency practitioner. If you require assistance on liquidating a company, restructuring a debt or advice on any related matter, please feel free to get in touch with our insolvency team.