The Insolvency Law Gives Rise to Numerous Interpretations and Many Tend to Undermine Its Efficiency
Alexandru Iorgulescu was a speaker at this year’s conference The Insolvency Code organized by Bursa. Among other relevant aspects related to the development of the insolvency market in Romania, Alexandru focused on the impact of the recent interpretations of the insolvency law by the High Court of Cassation and Justice and the Constitutional Court.
The insolvency law gives rise to numerous interpretations and many tend to undermine its efficiency.
Among the susceptible elements in this regard, Alexandru Iorgulescu has indicated the failure to understand the purpose of the law, and namely that of maximization of general pledge, i.e. of the debtor’s estate as a security in the creditors’ favor and ignoring of the contamination effect, referring to the articles introduced by OUG 88/2018 under the pressure of the budgetary creditor. In this landscape, the two methods of settling the issues of non-unitary practice that are available to the High Court of Justice also appear as tools for correcting these interpretations.
Moreover, the attorney at law reminded also about the failure of understanding of the ones coming into contact with the law of the civil institutions and mechanisms and their finality, Alexandru Iorgulescu explained referring to the discussion about the precautionary seizure enforced over the debtor’s assets, as well as the failure to understand the mechanisms of market economy.
“In the context in which 50% of all companies end their existence until they reach ten years, insolvency appears as an inherent phenomenon, accepted by the principles of market economy”, Alexandru Iorgulescu pointed out.