Study On Localization Of Prepackaged Bankruptcy System

Along with the growing development of market economy system and the change of bankruptcy culture concept,the application of Bankruptcy reorganization procedure to save the enterprises in economic difficulties has been an important part of the framework of bankruptcy system.However,with the gradual development of practice,the shortcomings of Bankruptcy reorganization due to the complexity of its design have become more and more exposed and become an obstacle in the process of business regeneration of troubled enterprises.The Prepackaged bankruptcy was born in the late 1980s in the United States and became a powerful tool to bridge the inherent flaws of Bankruptcy reorganization and facilitate the early regeneration of troubled companies.Since then,countries all over the world have introduced this system to improve their own rescue systems for troubled enterprises,and China also intends to introduce it based on the need to optimize the business environment and improve the mechanism for troubled enterprises.However,different countries and regions have different economic environments,cultural concepts and legal system characteristics,so each country has localized the system in the process of introducing the Prepackaged bankruptcy in order to smoothly integrate it into the rescue mechanism of their troubled enterprises.Currently,the introduction of the Prepackaged bankruptcy in China is mainly guided by judicial and policy documents in principle,and local governments or courts issue guiding documents to apply according to the actual situation in the region.However,in the absence of clear legislative provisions,three models of the Prepackaged bankruptcy practice have evolved in judicial practice in each region based on the actual situation.Although the three models have addressed the current needs to a certain extent,a number of practical dilemmas and controversies have arisen in the application of the Prepackaged bankruptcy in China due to a combination of factors such as cultural beliefs,business environment and lack of uniform rules and guidelines.The scope of the Prepackaged bankruptcy cases is limited,the specific rules of the Prepackaged bankruptcy procedures are not sufficiently detailed,the boundaries of governmental and court powers in the Prepackaged bankruptcy procedures are ambiguous,and whether it is reasonable to apply the "automatic stay" system to avoid the loss of corporate assets.After analyzing the practical cases and regional guidelines,it is found that the root cause of the practical dilemma in China is the misunderstanding of the nature of the Prepackaged bankruptcy and the deviation of the purpose and function of the Prepackaged bankruptcy from the "identification" and "success promotion" function in various regions.The consequence of this is that judicial or administrative powers are inappropriately spilled over into the the Prepackaged bankruptcy process,thus depriving the Prepackaged bankruptcy of its intended market-based regulatory and efficiency functions.Therefore,in view of the current problems in practice,it should be dealt with in accordance with the actual situation in China on the basis of systematic analysis and summary of useful experience in foreign countries.The main text is divided into five parts:In the first part,the theoretical basis and value of the Prepackaged bankruptcy are discussed.The theories underlying the Prepackaged bankruptcy are analyzed from three perspectives:legal economics,legal sociology and contract theory,while the value of the Prepackaged bankruptcy is compared to Bankruptcy reorganization and out-of-court debt restructuring,and the advantages and inherent limitations of the Prepackaged bankruptcy are analyzed by means of institutional comparison.The second part is about the judicial status of the Prepackaged bankruptcy in China.The first analyzes the current situation of the Prepackaged bankruptcy in China at the practical level by using cases and three the Prepackaged bankruptcy practice models in China,followed by a brief introductory analysis of the judicial and policy documents issued at the central level and regional guideline documents.This is to provide a glimpse of the localization of the Prepackaged bankruptcy in China at the normative level.The above analysis provides a clear picture of the localization of the Prepackaged bankruptcy in China.The third part is the practical difficulties and causes of the Prepackaged bankruptcy in China.Based on the analysis of the current judicial situation in China,some practical problems and controversies of the Prepackaged bankruptcy in China are analyzed and discussed.After clarifying the current situation of practice and regulation in China,the causes of the dilemma of the Prepackaged bankruptcy in China are discussed based on the basic attributes and proper purposes and functions of the Prepackaged bankruptcy.The fourth part is about the overseas experience of the Prepackaged bankruptcy system.The U.S.,as the origin of the Prepackaged bankruptcy,has a more mature procedural process and jurisprudence,which are analyzed in detail in this paper.The design of the rescue mechanism for troubled companies in the United Kingdom is based on its own local situation and has developed a rescue model different from that of the United States,which has also had a profound impact on the design of rescue mechanisms in East Asian countries.The new rescue mechanism for troubled companies in Germany,which was set up when the bankruptcy law was revised,has also improved the efficiency of rescue for troubled companies without changing the original framework,and it is also necessary to examine this.After analyzing the mature experience of the above three countries,we discuss the useful experience that can be applied to China.The fifth part is the construction of the Prepackaged bankruptcy system in China.After taking into account the economic and cultural factors in China,we propose the construction of a the Prepackaged bankruptcy system.In terms of legislative path and model,it is proposed that two types of the Prepackaged bankruptcy models should be established in the form of legislation,and the specific rules of the Prepackaged bankruptcy should be designed to regulate the initiation mechanism,information disclosure and voting procedures,court approval criteria,and the interface between the Prepackaged bankruptcy and Bankruptcy reorganization.The government and the court’s powers and responsibilities should be clarified during the Prepackaged bankruptcy period to prevent abuse of power,and at the same time,they should play their respective functions to assist the parties in the Prepackaged bankruptcy process.