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All You Need to Know About Becoming an Insolvency Practitioner In

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All You Need to Know About Becoming an Insolvency Practitioner In REMUNERATION OF INSOLVENCY PRACTITIONERS This time we bring you a real scoop. Insolvency law, legal status and remuneration of the insolvency practitioners, has completely changed in Poland! Judge Anna Hrycaj, who presented this subject at the ACC conference in Warsaw last year, and who was asked to adapt her presentation to the needs of our journal, was obliged to write a new article, because Poland was surprised a couple of weeks ago by a new law… So, we are proud to offer you an analysis of the new requirements for becoming an IP in Poland. If you have any questions, please write to [email protected] or [email protected] for further information. All you need to know about becoming an Insolvency Practitioner in Europe: Poland We have already looked at the legal status and remuneration of insolvency practitioners in France, Austria and Latvia. Here we discuss what happens in Poland The legal status of the Insolvency and the court does not deprive the • He/she has the full legal capacity to act; Practitioner (IP) in Poland is soon to be debtor of the right to administer the • He/she is under 65; regulated not only by the provisions of estate; • He/she received higher education the Bankruptcy and Rehabilitation Law, • The receiver ( zarz ądca ), who is qualifications and obtained an MA or 28 February 2003, but also by the appointed in the case of insolvency any other correspondent title in the provisions of the Polish law on IPs which with the possibility of making an member states mentioned above; was enacted by the Polish Parliament on arrangement with creditors, but the • He/she has an unblemished 9 May 2007. Here is the latest news on debtor is deprived of the right to reputation; becoming an IP in Poland. administer the estate. • In the period of 15 years before filing According to current provisions, the access the petition to obtain the licence, Access to the to the profession of an IP is rather easy. he/she has managed or part-managed profession The new law on insolvency practitioners an enterprise for at least three years, tightens the criteria concerning this issue • He/she has not been convicted of an There are three categories of IPs in and states that the licence will be offence, including a fiscal offence; Poland: conferred by the Minister of Justice. A • He/she has not been accused of committing an offence that was • The liquidator ( syndyk ), who is candidate will be able to acquire the prosecuted by the public prosecutor; appointed in the case of insolvency licence when: • He/she is not on the list of insolvent involving the liquidation of the • He/she is the citizen of the EU debtors administered by the National debtors’s estate; member state or the EFTA member Court Register; • The court supervisor ( nadzorca s dowy ), ą state; • He/she passed an exam; who is appointed in the case of • He/she knows Polish language • He/she is not considered unable to insolvency with the possibility of sufficiently enough to fulfil his/her work in the understanding of the making an arrangement with creditors functions in insolvency proceedings; national insurance law. 20 | REMUNERATION OF INSOLVENCY PRACTITIONERS The most important change introduced Costs and Control by this new law is the obligation to pass remuneration body an exam. The exam will contain legal, economic and financial issues with more The new law also introduces some In Poland there is no external body to importance placed on the Bankruptcy and amendments to the Polish Bankruptcy and control the actions of an IP. The liquidator, Rehabilitation Law. In my opinion this Rehabilitation Law. Some of these the court supervisor and the receiver exam should also cover cross-border amendments concern the remuneration of exercise their functions under the insolvency proceedings issues. the IP. Currently the remuneration of the supervision of the judge-commissioner. Those successful in getting the licence IP is settled by the bankruptcy court. This rule is expressed in Article 152 of the will be put on a list administered by the According to Article 162.2, the amount of Bankruptcy and Rehabilitation Law which Minister of Justice. The list and the the remuneration may not exceed the states that the judge-commissioner shall information about the people on it will be value of 5% of the insolvent estate’s funds. direct the course of the proceedings, sent to the Chief Justice of every district The amounts obtained from the sale of the supervise the activities of the IP and court. The bankruptcy court or the judge property and rights encumbered by designate acts which the IP is not commissioner will be able to appoint the mortgage, pledge and registered pledge permitted to execute without the judge’s IP from this list. are assigned for the satisfaction of those permission or the approval of the creditors whose claims were secured on creditors’ committee. The judge- Appointment the transferred property or rights. commissioner is able to rebuke the IP for Therefore these amounts are not included violations which he/she has committed. in the funds of the insolvent estate (Article The most important power of the judge- At present and until the new law is 336) and they are not taken into commissioner is the right to dismiss the IP enforced, the possibility of being consideration by the court while making if he/she does not perform obligations well appointed as an IP in a particular the decision about the remuneration of enough. insolvency proceeding is regulated by The the IP. It is unfair because a lot of work is The law on insolvency practitioners Order of The Minister of Justice, 16 April needed to sell the secured property and introduces new forms of supervision by 1998. rights and the value of these should the judge-commissioner by amending the The IP is appointed by the bankruptcy influence the amount of the IP new Article 169a to the Bankruptcy and court. The appointment is included in the remuneration. Rehabilitation Law. This article states that declaration of insolvency. An IP can also The new law reduces the maximum the judge-commissioner may reprimand be appointed in a case when the previous amount of the IP remuneration to 3% but the IP and in the event that the IP does IP was dismissed or died (Article 170 of at the same time it introduces the not correct his/her errors, the judge- The Law on Bankruptcy and principle that the basis for counting the commissioner may fine the IP. The fine Rehabilitation). In the latter case, the new total value of remuneration will not only can not exceed the 30,000zł (about 750 IP is appointed by a judge-commissioner. be the value of the insolvent estate’s funds Euros). The IP can be dismissed by a judge- but also the value of the amounts obtained It is for this reason that there is no commissioner if he/she does not perform from selling the secured assets. The law need for any external body to control how their obligations well enough or if he/she also introduces a maximum amount of IP the IP fulfils his/her obligations in is unable to fulfil them. remuneration that is independent from insolvency proceedings. According to Article 157 of The Law the total value of the insolvent estate. So on Bankruptcy and Rehabilitation, the the amount of the remuneration cannot Conclusion liquidator, the court supervisor and the exceed the amount of 140 average receiver may be the person holding the The new law is almost ready, but the monthly wages in the enterprise sector appropriate licence. The IP may also be a legislative process is not over yet. without payment of bonuses from profits company or a partnership whose However, it is hoped that it will bring new in the fourth quarter of the previous year. shareholders or partners bear liability for and better solutions for the functioning of In the case when there are no funds in the its obligations by their entire estate insolvency practitioners in Poland. insolvent estate, the total amount of the without limitation, or members of a remuneration counting in months cannot managing body representing a company be more than the average monthly wages or a partnership which is in possession of in the enterprise sector. such licence. In accordance with Article According to the new law, in 157 section 3 of The Law on Bankruptcy determining the final amount of and Rehabilitation, the procedure of remuneration, the court should take into granting a licence is specified by a consideration the degree of satisfaction of different law, which has been passed by the creditors, the work expenditure, the Parliament, but has not come into force cost of employing additional workers by yet (www.sejm.gov.pl). This new law has the IP and the duration of the insolvency JUDGE ANNA caused a big debate amongst insolvency proceedings. HRYCAJ practitioners because it is completely Poland different from current existing provisions. eurofenix | 21.
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