More than 1,200 Croatians filed for bankruptcy since 2016

More than 1,200 Croatians filed for bankruptcy since 2016 Izvor: Pixabay

From January 1, 2016, when the Consumer Bankruptcy Act went into power, until August 6, 2018, 1,212 personal bankruptcy proceedings were started over debts totalling 890.8 million kuna (€120 million), with more than 71 percent resulting in unsuccessful out-of-court settlements, the Financial Agency (Fina) reported on Tuesday.

Based on inventories of assets and list of total unpaid debts that all debtors must submit at the start of the procedure, persons who filed for bankruptcy had a total of 7,378 creditors, to whom they owed €120 million.

Some 55 percent of the proceedings were started in Zagreb for debts totalling 428.8 million (€57.6 million), which accounts for 48.1 percent of all debts. The capital also accounted for nearly a half of unsuccessful out-of-court settlements (417 out of 871).

Under the law from 2016, for a personal bankruptcy procedure to be launched, the applicant must be unable to pay one or more claims exceeding 30,000 kuna (€4,070) in total for a period of at least 90 days.

Justice Minister Drazen Bosnjakovic presented last week a draft of a new enforcement procedure law, which would bring the procedure back under courts’ jurisdiction, while public notaries would take part in the procedure only as court commissioners. The current procedure is dispersed and not overseen closely enough, the minister had said last week, adding that the new law would offer a faster, simpler, and cheaper system.

The bill envisages greater protection of debtors and lower costs of the procedure, as well as expanding the category of those exempt from enforcement procedure and prohibiting evictions during winter months.

The bill is expected to be completed and put forward to the government and the parliament by the year’s end.

(€1 = 7.4 kuna)

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