LAW on banks' bankruptcy proceedings no. 83 of 1998

 

CHAPTER I
General provisions

 

Art. 1. - Banks legally constituted in Romania, in a condition of insolvency, shall apply the bankruptcy proceedings instituted by the present law.

Art. 2. - A bank shall be considered insolvent, when it is in one of the following situations:
            a) the bank has not fully met its doubtless, liquid, and exigible claims for at least thirty days;
            b) the value of the bank's liabilities exceeds the value of its assets.
            The value of the bank's assets and liabilities shall be calculated according to the norms issued by the National Bank of Romania in this sense.

 

CHAPTER II
Powers of the bodies in charge of the bankruptcy proceedings

 

Art. 3. - The main powers of the tribunal, within the framework of the present law, shall be:
            a) to appoint the judge-syndic and, in agreement with the National Bank of Romania, to designate the official receiver, to exercise the control on their activity and, if such be the case, to replace them;
            b) to approve the appointment of experts, authorized according to the law, to assist the judge-syndic in the fulfilment of his duties;
            c) to adjudge the petitions of deprivation of the debtor bank's managers of the right to conduct its activity;
            d) to adjuge proceedings instituted by the judge-syndic for the annulment of transfers with a patrimonial character, antecedent to the petition in bankruptcy;
            e) to adjudge the creditors' or debtor bank's contestations of the measures taken by the judge-syndic;
            f) to confirm the scheme of apportionment of the funds obtained from liquidation;
            g) to settle objections to the half yearly reports and the final report of the judge-syndic;
            h) to give orders for the beginning and ending of the bankruptcy proceedings.

Art. 4. - The decisions of the tribunal shall be final and executory. Under the conditions of the law, they can be disputed with appeal.

Art. 5. - The judge-syndic shall be appointed by the chairman of the tribunal, on the grounds of the Law No. 92/1992 on the judicial organization.

Art. 6. - In discharging his duties, which imply the application of banking regulations, the judge-syndic may also request the opinion of the National Bank of Romania in its capacity of banking supervising authority.

Art. 7. - The judge-syndic's main duties within the framework of the present law shall be:
            a) the examination of the debtor bank's activity, in relation to the de facto position; preparation of a detailed report on the causes and circumstances which have led to the stoppage of payments, mentioning the persons to whom it would be imputable; and subjection of that report to the tribunal within thirty days after his appointment;
            b) the guidance of the persons employed to help him;
            c) the initiation of legal action at the tribunal for the annulment of fraudulent acts concluded by the debtor bank to the prejudice of the creditors' rights as well as of transfers with a patrimonail character, of certain commercial operations concluded by the debtor bank, and of the constitution of certain guarantees granted by it;
            d) the maintenance or cancellation of certain contracts concluded by the debtor bank;
            e) the admission of the liquidation scheme of certain goods from the debtor bank's assets up to the balancing of the liabilities;
            f) the application of seals, the inventorying of the debtor bank's goods, and the taking of adequate measures for their conservation at the beginning of the bankruptcy proceedings;
            g) the examination of the debts, and formulation of objections to them, if such be the case;
            h) the prosecution of the collection of debts from the debtor bank's assets, resulted from transfers of goods or sums of money, effected by it before the filing of the petition in bankruptcy;
            i) the liquidation of goods from the debtor bank's assets;
            j) the reception of payments on the debtor bank's account and consignment of the sums of money in a banking account opened within twenty-four hours at the National Bank of Romania in the name of the debtor bank, with exclusive right of disposition in the interest of the bankruptcy proceedings;
            k) notification of the tribunal about any problem which should require a solution given by it;
            l) the carrying out of any acts of proceeding requested by the present law.

Art. 8. - The debtor bank and any of the creditors may introduce a petition of appeal against the measures taken by the judge-syndic, in the cases expressly provided under the present law. Such a petition of appeal shall have to be filed within ten days after the date on which the measure was taken, and its adjudication shall be made within not more than thirty days. If it considers necessary, the tribunal may hold a session, with summoning of the author of the petition of appeal, of the debtor bank, of the creditors, and of the National Bank of Romania, with participation of the judge-syndic.

Art. 9. - At any stage of the bankruptcy proceedings, the tribunal may replace the judge-syndic with another, by a motivated interlocutory judgement pronounced in the court chamber.

Art. 10. - In all cases of bankruptcy, at the proposal of the judge-syndic and with the advice of the National Bank of Romania, the tribunal shall appoint an official receiver who shall have to be a specialist juristic person, constituted in keeping with the law.

Art. 11. - An official receiver shall be invested with powers of management and control on the debtor bank, and may take any measures he would consider necessary for the liquidation of the debtor bank's assets in order to obtain their optimum turning to account even in cases in which the debtor bank's authorization was withdrawn. These measures shall regard the following aspects:
            a) to continue or, in a justified way, discontinue any operations;
            b) to borrow money, with the debtor bank's assets as guarantee or without guarantee;
            c) to establish anew the interest rates corresponding to the debtor bank's liabilities, on condition, however, that any new level of the interest rate should not be lower than the lowest level practiced in the banking market;
            d) to hire the personnel required for the liquidation;
            e) to conclude any document in the name of the debtor bank, to initiate or defend and to coordinate any legal action or proceeding, in its name.
            The official receiver shall prepare a monthly report on the evolution of the bankruptcy proceedings, to be presented for approval to the judge-syndic, after which he shall also send it to the National Bank of Romania. Such a report shall include information referring to the total value of claims against the debtor bank and the total value of the debtor bank's assets which were sold.

 

CHAPTER III
Proceedings of information of the tribunal

 

Art. 12. - The bankruptcy proceedings shall begin on the basis of a petition filed by the debtor bank or by its creditors at the National Bank of Romania. The tribunal entitled to adjudicate the petition shall be that under whose jurisdiction is the debtor bank's registered office.

Art. 13. - The bankruptcy proceedings of a bank shall, as a rule, be commenced after the finding by the National Bank of Romania that the application of the measures of special supervision, deployed for the poupose of the bank's recovery, have not led to the avoidance of the insolvency condition.

Art. 14. - The debtor bank, which is no longer able wholly to meet its exigible debts with the available sums of money may present to the relevant tribunal a petition asking to be subject to the provisions under the present law. The bank's petition shall be signed by the persons who, according to the provisions of the law, have the capacity to represent it.

Art. 15. - The debtor bank's petition shall be attended by the following deeds:
            a) the balance sheet and copies from the current books of accounting;
            b) a list of all the goods; for buildings, data from the real estate books shall be listed;
            c) a list of the names and addresses of the creditors, whichever might be their claims - certain or under condition, liquid or non-liquid, due or not due, uncontested or contested - showing the sum of money, the cause and priority rights;
            d) the profit and loss account for the year previous to the filing of the petition.

Art. 16. - Any creditor who has a certain and exigible claim may present to the tribunal a petition against a debtor bank which has been for at least thirty days in stoppage of payments. The creditor can not file the petition without proving that, previously, as a result of introducing of a action of enforcement on the de debtor bank's account, the National Bank of Romania, in its capacity of garnishee, had communicated that the respective bank is in a position of stoppage of payments of more than 30 days.

Art. 17. - The National Bank of Romania, in its capacity as banking supervision authority, will be in a position to file a petition against the bank subject to the application of measures of supervision and special administration, and which have not led to the recovery of the bank which is in a situation of not wholly meeting payments.

Art. 18. - After filing the petition, introduced according to articles 14, 16, and 17, the tribunal shall notify this fact to the interested parties and to the office of the trade register where the debtor bank is incorporated, for entering the mention. All expenses for these measures shall be borne from the assets of the debtor bank.

Art. 19. - At the first term of judgement, the tribunal shall examine the petition and, in case the debtor bank shall not oppose the position of insolvency, shall order the immediate beginning of the bankruptcy proceedings of the debtor bank. The appeal against the petition of commencement of the bankruptcy proceedings may be introduced within five days after the date of the filing of this petition. The tribunal shall adjudge the contestation within ten days after its filing, which term may be extended by further ten days only once. The judgement with regard to the beginning of the bankruptcy proceedings of the debtor bank shall be communicated forthwith to the Guarantee Fund of Deposits in the Banking System, with a view to the application of the regulations concerning the payment of guaranteed deposits.

Art. 20. - The tribunal shall communicate to the National Bank of Romania its decision with regard to the beginning of the bankruptcy proceedings of the debtor bank. The National Bank of Romania shall forthwith close the accounts of the debtor bank, opened at the National Bank of Romania, and shall open a new account with the mention ,,bank in bankruptcy". In this account shall be transferred the sums of money existing up to that date in the bank's accounts. Further, the financial operations of the bank in bankruptcy shall procced through this account exclusively.

Art. 21. - The other proceedings of carrying on the operations of liquidation are provided under the law No. 64/1995 on the judicial reorganization and bankruptcy proceedings, with the subsequent modifications, CHAPTER III, section 6, "Bankruptcy", which shall also be applied adequately to the bankruptcy of banks proceedings.

 

CHAPTER IV
Responsibility of the management bodies and of auditors of the bank in bankruptcy

 

Art. 22. - The tribunal may dispose that part of the liabilities of the bank in a state of bankruptcy be borne by members of the management bodies - managers, directors, and auditors, as the case may be, if they have contributed to the bankruptcy of the bank by one of the following deeds; if they have:
            a) used the bank's goods or credits to their own profit;
            b) made trading operations to their personal interest, under the coverage of the bank;
            c) disposed in their personal interest the continuation of an activity obviously leading the bank to a stoppage of payments;
            d) kept fictitious books, caused to disappear some accountancy documents, or have not kept the books conformably to the law;
            e) misappropriated or hidden part of the bank's assets, or increased fictitiously its liabilities;
            f) made use of ruinous means to raise money for the bank in order to delay the stoppage of payments;
            g) paid or disposed to be paid preferentially to a creditor at the expense of the other creditors, in the month previous to the stoppage of payments.
            Application of the provisions under para. (1) shall not abolish the application of the criminal law for the deeds constituting offences.

Art. 23. - The sums of money paid according to Art. 22 para. (1) shall enter into the debtor bank's assets and be destined to the payment of the debts.

Art. 24. - With a view to the taking of the measures provided under Art. 22 para. (1), the tribunal may be informed by the judge-syndic, by any of the creditors, by the National Bank of Romania, or it may take notice ex officio, on the grounds of the data in the file of the cause, and shall order protective measures.

Art. 25. - Enforcement against the persons provided under Art. 22 para. (1) shall be carried out according to the provisions of the Code of civil procedure.

Art. 26. - The bankruptcy proceedings shall be closed when the tribunal shall have approved the final report, when all funds and goods from the assets of the bank in a state of bankruptcy were apportioned, and the unreclaimed funds have been deposited with the National Bank of Romania. As a result of a petition of the judge-syndic, the tribunal will give a decision, closing the bankruptcy proceedings. The decision shall be served, in writing, on all creditors, on the debtor bank and on the National Bank of Romania, which shall close the account "bank in bankruptcy" existing with it, and shall transfer the possible sums of money remaining in the account to the state budget.      

These sums of money may be solicited by entitled persons within the legal term of limitation.

 

CHAPTER V
Transitory and final provisions

 

Art. 27. - The provisions of the present law shall be completed, to the extent of their compatibility, with those of the Code of civil procedure.

Art. 28. - The procedures of reorganization and of judicial liquidation of banks, opened before the date of coming into force of the present law, shall be continued and closed under the terms of the Law No. 64/1995 on the proceedings of judicial reorganization and of bankruptcy, with subsequent modifications and completions.

Art. 29. - The present law shall come into force after thirty days from the date of its publication in the "Monitorul Oficial" (Official Gazette of Romania), Part I.

Art. 30. - On the date of coming into force of the present law, any provisions to the contrary shall be abrogated.

 

Published in the "Monitorul Oficial" (Official Gazette of Romania), Part I, No. 159 of April 22, 1998