Representatives of EU Project Pravo-Justice and the Ministry of Justice of Ukraine Took Part in the Conference of the Eastern European Countries’ Committee of INSOL EUROPE

On June 13-14, 2024, a conference of the Eastern European Countries’ Committee of INSOL Europe was held in Krakow (Poland). The event was attended by the professionals in the area of restructuring, insolvency and bankruptcy from Poland, the Czech Republic, Ukraine, Germany, Italy, Austria, Greece, Bulgaria, Romania, the Netherlands, and France.

The Ukrainian position at the event was presented by Iryna Zharonkina, Enforcement and Protection of Property Rights Component Lead, EU Project Pravo-Justice, and Vladyslav Filatov, Director of the Bankruptcy Department of the Ministry of Justice.

Iryna Zharonkina devoted her speech to the impact of sanctions that were introduced in 2014 and significantly expanded after the full-scale military aggression of the Russian Federation against Ukraine, on insolvency procedures. She noted, in particular, that as of the beginning of June 2024, the number of individuals and legal entities under sanctions exceeds 17,000.

At the same time, she stated that Ukrainian national legislation provides for a number of restrictions in insolvency procedures and enforcement of decisions in respect of those creditors and debtors who have been put on the sanctions lists by the National Security and Defense Council of Ukraine. That is why the question of how to achieve the goal of insolvency procedures, taking into account the sanctions-related legislation, needs to be addressed urgently.

“The EBRD defines two key objectives of insolvency procedures. The first one is to distribute risks among participants in a market economy in a predictable, fair and transparent manner; while the second one is to protect and maximise value for the benefit of all stakeholders and the economy as a whole. Therefore, today we are in a situation where the sanctions prevent damage to national interests, but the question remains as to how to achieve the objectives of bankruptcy,” said Iryna Zharonkina.

The Lead of Enforcement and Protection of Property Rights Component, EU Project Pravo-Justice, introduced the audience to the legislation on the application of sanctions in Ukraine, the amendments to the Bankruptcy Procedures Code taking into account the sanctions-related legislation and the current judicial practice in cases of insolvency, where one of the parties is under sanctions.

Special attention was paid, in the framework of the event, to the preventive restructuring procedure, the role and importance of a bankruptcy trustee, the role of the state in restructuring and insolvency procedures, and procedural terms in insolvency cases in various jurisdictions.