Shenzhen Intermediate People's Court Deepens Bankruptcy Reform, and One Measure Was Awarded "People's Court Reform and Innovation Award"

Nandu News Reporter Qin Shilin A few days ago, the Shenzhen Intermediate People's Court's reform measure of "deeply cultivating the bankruptcy reform experimental field and the new pattern of service guarantee development" won the first "People's Court Reform and Innovation Award" of the Supreme People's Court, which is the only award-winning measure in the Guangdong court system. In the service guarantee of the Guangdong-Hong Kong-Macao Greater Bay Area and the construction of the Shenzhen Socialist Pilot Demonstration Zone with Chinese Characteristics, the Shenzhen Intermediate People's Court has deeply cultivated the experimental field of bankruptcy reform, and has taken the lead in improving the bankruptcy institution model, establishing a personal bankruptcy system, improving the bankruptcy reorganization system, and promoting cross-border bankruptcy cooperation, and achieved fruitful results.

High standards to build a special court, three years to revitalize assets of 22.7 billion

On January 14, 2019, the Shenzhen Bankruptcy Court, the first special bankruptcy court in China, was officially established. In accordance with high-standard and professional standards, the Shenzhen Intermediate Court has continuously optimized the functions of the bankruptcy court, effectively improved the professionalism of bankruptcy trials, and made the bankruptcy system more complete.

In 2021, the Shenzhen Bankruptcy Court heard a total of 4,028 bankruptcy cases, an increase of 28.9% year-on-year; concluded 2,741 enterprise bankruptcy cases and 62 personal bankruptcy cases, an increase of 68.35% year-on-year. Among them, 1361 bankruptcy applications were reviewed, 735 bankruptcy cases, 691 bankruptcy derivative litigation cases, 12 compulsory liquidation cases, and 4 judicial punishment cases. In the past three years, the Shenzhen bankruptcy court has revitalized assets of 22.7 billion yuan, paid off a total of 25.8 billion yuan in creditors' rights, and helped 18,151 employees stabilize employment.

Take the lead in exploring the personal bankruptcy system and improve the bankruptcy legal system

Since the implementation of the Shenzhen Personal Bankruptcy Regulations on March 1, 2021, the Shenzhen Intermediate People's Court has actively improved the supporting mechanism and formed a set of diversion identification standards to effectively prevent bankruptcy fraud and remedy "honest and unfortunate" debtors according to law. At present, the Shenzhen Bankruptcy Court has received 943 personal bankruptcy applications, interviewed 516 applicants, scientifically and carefully screened eligible bankruptcy applications, formally filed and reviewed 55 cases, and initiated 21 bankruptcy procedures.

After review in accordance with the law, the Shenzhen Bankruptcy Court has heard a number of personal bankruptcy cases of typical significance, and realized the full application of Shenzhen's personal bankruptcy regulations. Among them, the bankruptcy reorganization case of Liang X, the bankruptcy settlement case of Zhang X, the bankruptcy liquidation case of Hu X and the bankruptcy entrustment settlement case of Wei X are the first cases in China.

The landing of the first case in different procedures of personal bankruptcy has formed a judgment rule with reference value for the handling of personal bankruptcy, the concept of honest and exemption from liability bankruptcy has won public recognition, and the consensus on reform has continued to condense, which has stimulated the vitality of social innovation and entrepreneurship.

Vigorously improve the bankruptcy handling system, and reform measures will benefit all types of entities

On August 18, 2021, the Shenzhen Intermediate People's Court, together with the Shenzhen Municipal Market Supervision and Administration Bureau and the Shenzhen Municipal Bankruptcy Administration, jointly signed and issued the Implementation Opinions on the Establishment of a Bankruptcy Information Sharing and Status Disclosure Mechanism (hereinafter referred to as the Implementation Opinions), taking the lead in implementing the bankruptcy information linkage publicity mechanism nationwide. Creditors, stakeholders and the public can learn about bankruptcy information from multiple channels and in a variety of ways.

Nowadays, the Shenzhen unified government service APP "i Shenzhen" has opened a personal bankruptcy column to provide information inquiry, registration and declaration and other services. On the "Shenzhen Credit Network", the public information of commercial entities involved in bankruptcy procedures is also included in the relevant bankruptcy information items, and with the gradual implementation of the "Implementation Opinions", the bankruptcy information projects are gradually disclosed and operated under the "sunshine", benefiting all kinds of entities.

So far, the Shenzhen Intermediate People's Court has changed the traditional "one case, one discussion" government-court linkage model, and has joined hands with 19 government agencies and departments to issue 5 opinions on the linkage work of handling bankruptcy governments and courts, reflecting the "linkage" in batch business handling, information disclosure and sharing, and the protection of the rights and interests of bankruptcy administrators.

Actively promote cross-border bankruptcy collaboration and expand the regional and international influence of bankruptcy handling

Previously, the Shenzhen Intermediate People's Court took the lead in launching a cross-border online auction model for bankruptcy estates, attracting overseas investment to successfully bid for the world's first large-scale bankruptcy estate, assisting Hong Kong bankruptcy estates in using the Network to successfully auction, improving the chances and value of bankruptcy estates, and creditors receiving better compensation.

On 26 May 2020, the High Court of Hong Kong ruled to recognize and assist the Shenzhen Intermediate Court in the bankruptcy liquidation proceedings of Shenzhen Nian fu Company, the bankruptcy ruling of the Mainland court was recognized by the Hong Kong court for the first time, and the bankruptcy administrator was allowed to fully exercise its rights on behalf of the parent company against the Hong Kong subsidiary for the first time.

On 14 May 2021, the Supreme People's Court and the HKSAR Government signed the Minutes of Talks on Mutual Recognition and Assistance in Bankruptcy Proceedings between the Mainland and the Hong Kong Special Administrative Region in Shenzhen, clarifying that the Shenzhen Intermediate People's Court will be the pilot court for cross-border bankruptcy cooperation.

On 20 July 2021, the Hong Kong High Court issued a cross-border bankruptcy assistance request letter to the Shenzhen Intermediate Court requesting recognition of the winding-up proceedings of Senshin Paper Hong Kong and the powers of the liquidators; on 15 December, the Shenzhen Intermediate Court ruled to recognize the Hong Kong bankruptcy proceedings of Senshin Company and its identity as a liquidator, and explicitly allowed the winding up of Senshin Company to perform its duties in the Mainland. This is also the first time that a Mainland court has recognized the validity of a bankruptcy ruling in Hong Kong.