At the beginning of the month Russian regulators implemented a draft law, which provides for the possibility of the Government of the Russian Federation by its act to introduce a moratorium on initiation of bankruptcy proceedings under natural and man-made emergencies, significant changes in the ruble exchange rate and similar exceptional circumstances (for more details see the update). The moratorium on bankruptcy has been in force in Russia since April 4, but now the Law on Bankruptcy is being corrected again. The need for amendments is due to the rushed adoption of the Law, as well as the reaction to criticism from the professional community The law providing for the amendment was signed by the President of the Russian Federation and comes into force on April 24. In particular, the new law establishes the following changes to the regime of the moratorium on bankruptcy.
1. The right to waive the moratorium
The draft law provides for the right of a person to waive the special regime if it applies to it. For this purpose, the person must make an appropriate application and submit a notice to the Unified Federal Register of Information on Bankruptcy. In case the Government of the Russian Federation prolongs the moratorium, the person’s earlier application will become invalid, but the person will be entitled to cancel the moratorium again.
2. Nullity of Transactions
The amendments also exclude from the Law on Bankruptcy provisions that provide for the nullity of transactions made during the moratorium. The initial amendments to the moratorium implied that all transactions (other than ordinary business transactions) concluded by the debtor during the moratorium period would be null and void if the price of such transaction (or several related transactions) exceeded 1% of the value of the debtor’s assets.