Bankruptcy Proceedings in Taiwan
As of October 16th, 2008 While Bankruptcy Application Is Pending Within seven days after receiving the Bankruptcy Application, the Court shall either approve the application and issue the Declaration of Bankruptcy or dismiss the application. If an investigation cannot be completed within seven days, an extension may be granted within seven days. Before a ruling is issued, the Court may conduct a necessary investigation at its discretion and summon debtors, creditors and other related persons. Possible Ruling Methods 1. Bankruptcy Application Approved – Company does not need to process dissolution registration and liquidation. 2. Bankruptcy Application Dismissed – Company may wind up all pending business according to liquidation procedures after its Shareholders approve a Dissolution Resolution. Court Rules to Issue a Bankruptcy Declaration When the Court issues a Bankruptcy Declaration, the following matters are handled simultaneously: 1. Appointment of a Bankruptcy Administrator. 2. Specify a period for creditors to register outstanding debts (Starting from the date of Bankruptcy Declaration, more than 15 days and less than three months). 3. Select a date for the first Creditors’ Meeting (must be within one month of Bankruptcy Declaration date).
Bankruptcy Administrators Bankruptcy Administrators are to be appointed by the following methods: 1. Selected among accountants or other persons suitable for managing the bankrupt consortium. 2. Creditors must select someone other than fellow creditors at the Creditors’ Meeting. In addition, when carrying out his/her duties, the Bankruptcy Administrator must be supervised by the Court, and when necessary, the Court may order him/her to provide certain guarantees. His/her remuneration shall be set by the Court. Restrictions on Place of Residence of Bankrupt Parties Bankrupt Parties may not leave their place of residence without obtaining permission from the Court. Termination of Bankruptcy Declarations After the Bankruptcy Declaration is issued, in the event that the bankrupt consortium does not repay the consortium’s costs and the consortium’s debts, the Court may, upon application from the Bankruptcy Administrator, terminate the Bankruptcy Declaration.
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