Rehabilitation procedure - additional opportunities for business resuscitation

On December 27, 2019, the Head of State of the Republic of Kazakhstan signed the Law on Rehabilitation and Bankruptcy and related amendments to some legislative acts of the Republic of Kazakhstan on issues of rehabilitation and bankruptcy, taxation, which entered into force on January 10, 2020.

At present, when all countries of the world, including Kazakhstan, are busy looking for ways out of the crisis - stabilizing the financial system, increasing the employment rate, when not only the country's economy, but the entire world economy is undergoing a financial crisis, This was especially reflected, of course, in connection with the introduction of quarantine; the issue of her health improvement through the rehabilitation procedure becomes even more urgent.

In accordance with the current legislation "On Rehabilitation and Bankruptcy" of the Republic of Kazakhstan, in addition to the procedure for bankruptcy (liquidation) of enterprises in relation to insolvent (insolvent) enterprises, a rehabilitation procedure is provided.

This procedure is spelled out in sufficient detail in the Law, which is aimed at restoring solvency and preserving the debtor's property. As one of the judicial procedures, the rehabilitation procedure takes a special place among them. This follows, first of all, from the peculiarities of the procedure itself, its goals and consequences of the introduction. Figuratively characterizing the rehabilitation procedure, we can say that this is the last chance for the enterprise to overcome the crisis.

Otherwise, if it is impossible to restore solvency, the court declares the debtor bankrupt and the bankruptcy procedure follows

According to the Law, a rehabilitation procedure is a procedure applied in court, within the framework of which reorganization, organizational and economic, managerial, investment, technical, financial and economic, legal and other measures not contradicting the legislation of the Republic of Kazakhstan aimed at restoring solvency are applied to the debtor.

In the early stages, when the financial insolvency has not yet become irreversible, the rehabilitation procedure is quite effective. It gives the enterprise additional opportunities to revive the business, reform it and restructure production.

In accordance with the amendments made to the law, the debtor and the creditor (with the exception of the creditor for taxes and customs payments) have the right to apply to the court with an application for the application of a rehabilitation procedure in case of temporary insolvency and subject to the presence of debt.

The rehabilitation procedure is not a mandatory procedure, therefore, a decision of the creditors' meeting on its introduction is necessary. This decision should be based on a real possibility to restore the debtor's solvency, and not just on the desire to extend the term of its operation.

The peculiarity of the application of the rehabilitation procedure is that from the moment of its introduction, the accrual of penalties (penalties, fines) for all types of debt, including bank loans and taxes, stops. That is, all existing debts of the enterprise will be repaid within the framework and terms of the rehabilitation procedure according to a schedule convenient for both the enterprise and the creditors themselves, in accordance with the approved plan.

The main document that ensures the organizational and economic unity of all measures of the investigated stage of bankruptcy is the plan for the rehabilitation of the enterprise. A feature of this document is that, being in essence a business plan for a project to restore the company's solvency, it must comply with the requirements of the law and be approved by the meeting of creditors.

As you know, in order to achieve the goals of the implementation of the rehabilitation procedure for the period of their implementation, the right to manage the company is transferred to the rehabilitation manager. However, the Law of the Republic of Kazakhstan "On Rehabilitation and Bankruptcy" also provides for the preservation of the right to manage the property and affairs of the debtor for the owner, i.e. for the head or founders (participants) of the insolvent debtor, who is subject to the powers and responsibility of the rehabilitation manager established by the legislation on rehabilitation and bankruptcy.

To date, 16 enterprises with a total debt of more than 41 billion tenge are in the rehabilitation procedure in the Almaty region, including the tax arrears of 1 billion tenge. At the same time, the debt repayment amounted to 6 billion tenge.

Thus, dear entrepreneurs, if today a difficult situation has developed at your enterprise with regard to the payment of accounts payable, you will make the right decision for yourself by realizing your rights through the rehabilitation procedure.

It is this procedure that will be able to maximally solve such problems as maintaining business, profitability of production and jobs.