Insolvency procedure will be simplified, Valeriu Lazar

The insolvency procedure will be essentially simplified, Deputy Prime Minister and Minister of Economy Valeriu Lazar said, commenting on the new Insolvency Law approved by the Government, Info-Prim Neo reports. ”The insolvency in a market economy is a kind of purgatory. It clears the economic area of the unhealthy assets and problematic companies. But we, through the non-clarity that characterizes the current law, created conditions for extending the insolvency procedure for years. In fact, the situation is not remedied as the assets of the given companies are disintegrated,” said Valeriu Lazar. According to the minister, the updated law includes the best international practices in the field and provides a larger number of instruments for restructuring the problematic companies. “The current law envisions only a restructuring procedure in case of insolvency. The new law defines more procedures that are aimed at faster settling the debts,” said the minister. The law strengthens the lending process and reduces the lending costs. It lays down terms for an insolvency procedure. “I think that the deadline should be three years. If it is not possible to improve the situation of a company during this period, there is no chance for this to happen later. For example, the insolvency problem at SA Termocom has been dealt with during nine years. The last time, the restructuring term was extended by a Government Decision for another three years, until February 2012. But the financial situation has not improved. The historical debts of over 2 billion lei haven’t been cleared. We can say nothing about the efficiency of SA Termocom as the heat charges speak for themselves,” said Valeriu Lazar. The adoption of the new insolvency law is also important for the launch of the talks on the creation of a Deep and Comprehensive Free Trade Area with the EU. Valeriu Lazar said the Ministry of Justice is drafting a bill concerning the liquidators and administrators of the insolvency procedure, who play an important role in this process.