A Study On Debt To Eauity Conversion In Bankruptcy Reorganization

The bankruptcy reorganization procedure refers to the bankruptcy reorganization system in the enterprise bankruptcy law,which is one of the legal systems stipulated in the enterprise bankruptcy law of our country.It refers to the application of the persons with strong relationship between the parties and the agreement between the debtor and the creditor under the auspices of the court to carry out business reorganization or debt adjustment when the enterprise is unable to pay the debts or insolvency of the creditors A system.The conversion of corporate debt into equity is a traditional market-oriented and normalized legal means in the bankruptcy reorganization process,which can reduce the debt of the debtor,help the debtor to get rid of the bankruptcy predicament and get back to life.Debt to equity can be divided into policy debt to equity and commercial debt to equity according to their types;debt to equity can be divided into liquidation behavior,investment behavior and contract change behavior according to their nature.Debt to equity swap can not only reduce the non-performing loans of banks and alleviate the debt predicament of enterprises,but also have the reality and operability of market economy.However,due to the short application time of debt to equity swap in the reorganization process,there are many practical problems to be solved.In the aspect of legislation:the legal provisions of debt to equity swap in commercial banks are not comprehensive,so it is necessary to improve the legislative provisions of debt to equity swap in commercial banks;the guarantee rights of debt to equity swap creditors are lack of necessary protection,so it is urgent to optimize the guarantee mode of debt to equity swap and protect the fair opportunity of repayment for all the equity swap creditors;the information disclosure system of debt to equity swap is lack in the reorganization procedure,which should be specially in the bankruptcy reorganization procedure In order to protect the legal rights and interests of all converted creditors,information disclosure system should be set up.In practice:due to the limitation of the judicial function of the court,the compulsory approval of the reorganization plan may damage the legitimate rights and interests of the converted creditors,so it is necessary to improve the way of the enforcement of the compulsory approval of the court;the evaluation and capital verification institutions of the creditor’s rights shares are lack of standardization and professionalism,which urgently need the high-level and strict evaluation and capital verification institutions;the credit system construction of the debt enterprises is endless Good,easy to cause the debtor to use dishonest means to cheat the preferential tax policy of debt to equity swap and the trust of the converted creditor,thus damaging the legitimate rights and interests of the creditor.Therefore,the establishment of a perfect credit system is helpful to standardize the implementation of debt to equity swap in the reorganization process,safeguard the legitimate rights and interests of the converted right holders,and promote the smooth and healthy operation of the market economy.