For the procedure to be launched, a person has to be more than 30,000 kunas in debt.
Since the beginning of last year, when the personal bankruptcy proceedings were introduced in Croatia, the Financial Agency (FINA) has received 1,007 applications for the launch of out-of-court bankruptcy proceedings, and in almost 67 percent of cases it has issued certificates of failure to find a compromise between debtor and creditors, reports Večernji List on August 30, 2017.
According to the FINA’s data, from 1 January 2016 to 28 August 2017, the initiation of out-of-court proceedings was requested by 1,004 citizens and three sole proprietorships, and their total debts exceed 605 million kunas.
Along with the request to initiate proceedings, a debtor must also submit a list of their assets and total outstanding liabilities. These records show that persons who requested the initiation of the procedures stated they had a total of 5,845 creditors and owed them a total of 605.16 million kunas.
Most proceedings, almost 54 percent or 539 cases, were initiated at the offices in Zagreb, followed by Osijek with 83 cases, Pula with 71 cases and Rijeka, in which bankruptcy has been requested by 46 persons.
Most of the reported outstanding debts were also reported in Zagreb – 251.7 million kunas or around 41.6 percent of the total reported outstanding liabilities in all procedures. Zagreb is followed by Split, where more than 87.9 million kunas or 14.5 percent of all reported outstanding liabilities were reported in 42 cases. The amount of debt in the proceedings initiated at the centre in Osijek is 46.35 million kunas, and the fourth largest amount of reported liabilities is in Dubrovnik, where over 38 million kunas of debt were reported in 13 separate cases.
The law on personal bankruptcy – which is officially called the Law on Consumer Bankruptcy – entered into force on 1 January 2016. In order for the proceedings to be initiated, a person must be incapable of paying their bills for at least 90 days in succession, with outstanding liabilities in the total amount of more than 30,000 kunas.
Bankruptcy proceedings can be requested by sole proprietorship owners as well, provided they have no more than 20 creditors, have total debts of less than 100,000 kunas, have no unpaid wages and salary contributions, and have not already initiated pre-bankruptcy or bankruptcy proceedings.
Personal bankruptcy procedures are led by courts, but the law stipulates that an attempt should be made to come to an agreement between debtors and creditors in an out-of-court process at one of FINA’s 21 centres in all Croatian counties.
According to recent data published by the FINA, since the beginning of last year, 16 out-of-court settlements had been concluded in consumer bankruptcy proceedings.
Translated from Večernji List.
