Insolvency

Insolvency is that state of the assets that is characterized by the insufficiency of the money funds available for the payment of certain liquid and demandable debts. Currently, the threshold value for opening the insolvency procedure (the minimum amount of the debt, in order to be able to introduce the application to open the insolvency procedure) is 40,000 lei for both creditors and debtors, for debts of a different nature than the salaries, and for employees is 6 average gross salaries per economy / employee.

Purpose of the insolvency procedure The purpose of the insolvency process is to establish a collective procedure to cover the debtor’s liabilities, granting, when possible, the chance to recover his activity. Unlike the forced enforcement procedure regulated by the Code of Civil Procedure, insolvency is distinguished by establishing a collective character in which all creditors compete for the satisfaction of the debt rights with granting the opportunity to recover the debtor’s activity whenever possible.

Bodies applying the procedure According to Law 85/2014 the insolvency procedure is implemented by: the courts, the syndic judge, the judicial administrator and the judicial liquidator.

1. Courts – the request to open the insolvency procedure (promoted by the insolvent debtor or creditor) is within the jurisdiction of the court in which the debtor had his / her registered office at least 6 months before the date of the court’s notification. Insolvency appeals fall within the jurisdiction of the court of appeal, in which the district court has the role of insolvency case.

2. The syndic judge – is the specialized magistrate for exercising the judicial control of the insolvency procedure. Initially, in the first regulations, its attributions were identified with those of the current administrator or judicial liquidator, in fact the syndicate being assimilated to an official in charge of managing and capitalizing on the assets of the bankrupt. Thus, in the first period of application of the Commercial Code of 1887, the administration of the bankruptcy was entrusted to a trustee of the creditors, most often a lawyer. By the amendments made by the Law of June 20, 1895, the syndicate became a syndic judge, a professional magistrate assimilated to the sitting judges and the investigating judges [2]. Only later did the syndicate turn into a court with specific role and attributions, limited to the control of legality over the insolvency procedure, the management and the decisions of opportunity being transferred to the administrator or the judicial liquidator.