COVID-19. On Bankruptcy and the Moratorium on It
Due to the increasing impact of the crisis caused by the coronavirus pandemic on economic activity, many enterprises are forced to suspend operations. This situation, due to the need to comply with quarantine, is aggravated by the President declaring the entire month of April of this year non-working in Russia.
The suspension of business processes inevitably leads to a deterioration in the financial performance of companies. A significant decrease in these indicators to certain values can lead to the appearance of signs of insolvency in enterprises, in which the persons controlling them become obligated to file a bankruptcy petition for the company they lead.
In the current situation, the government is taking measures aimed at preventing a surge in bankruptcy cases provoked by a sharp deterioration in the economic situation amid the implementation of measures aimed at overcoming the spread of the epidemic.
We are closely monitoring the actions taken by the President and the Government to adjust legislation and the documents issued in pursuance of the implementation of these measures.
Author:Denis Shestakov Partner, arbitration manager GRATA International St. Petersburg
Contacts: +7 (812) 384 48 38
Email: DShestakov@gratanet.com
