Financial Asset Management Company Safeguard Rights And Interests In Bankruptcy Proceedings

According to the restructuring of state-owned commercial banks and the reform of state-owned enterprises,4 financial asset management companies of Cinda, Orient, Great Wall and Huarong were set up invested by Ministry of Finance in 1999. The 4 corporations are mainly engaged in buying problem assets from stated-owned banks, managing and disposing the assets formed in buying.3 major problem assets receiving have been made since 1999. The capital sum of the non-performing asset totaled up to RMB238 million. There were too much problems when the financial asset management companies handled these problem assets. Recovery rate can't reach expectation. One important factor was that the debt enterprises evaded financial debts by laws and policies of that time. This caused the financial claim can be recover. The loss was great.With the unveiling of the Enterprise Bankruptcy Law of the People's Republic of China, the new bankruptcy system put forward new proposition for the rights and benefits maintenance of the financial asset management corporation in bankruptcy claim.After the outbreak of the Asian financial crisis in 1997, our country set up 4 financial asset management companies in 1999, China Huarong Asset Management Corporation (CHAMC), China Great Wall Asset Management Corporation (GWAMC), China Cinda Asset Management Corporation (CINDAMC), and China Orient Asset Management Corporation (COAMC). Besides receiving and disposing non-performing assets, they also shoulder the mission of promoting the reform of state-owned enterprises.In receiving the problem assets separated from banks, the creditor's rights of the bankruptcy enterprises take a large part. This directly affects the completion of its task. For the negative response of the financial asset management corporation under the bankruptcy of the debtors, it's hard to form effective ways and methods. Self legitimate interests can't be protected.The new bankruptcy law which as a basic law in market economy is put into practice. This brings a certain opportunities and challenge. Providing institutional guarantee for the financial asset management companies'rights and benefits maintenance, the effect of the new bankruptcy law lies in:the manager system is relatively fair; the accountability system before bankruptcy is good for legal advantage; the creditor meeting is convenient for right-protecting. The priority of relative labor creditor's rights is not good for secured debt realizing. Reorganization system might make the financial asset management corporation achieve excessive over earnings.Under the framework of the new system, the financial asset management companies can do something. They can use the new system to deal with the escape behavior of the debtors and the interference of the unfair executive power. They totally have the ability to maximize receiving the problem assets.The concrete methods are:to strengthen the creditor's rights maintenance and management and pay attention to the enterprise operation before the bankruptcy of the debt enterprise; to give attention to the enterprise reform to prevent it evading paying debts; to concern the exist of the mortgaged property and explore executable property to decrease the loss; when necessary, to exercise the right of bankruptcy application to achieve the purpose to recover.The positive ways in the bankruptcy procedure of debt enterprise are:(1) To report claims timely to ensure the premise of the creditor's rights realization;(2) To exercise the right of exclusion to ensure security against loss;(3) To take recourse against the guarantor using the legal provisions;(4) To play a positive role in the creditor meeting to exercise the rights granted by law in more positive manner.(5) To strengthen controlling the manager according to law;(6) To participate in the enterprise reorganization in advance using the advantage having most debt to ensure the long-term interests and vested interests;(7) To value the request that the debtors propose, to make efforts to reconcile, realize cash-recovering.In order to perfect the bankruptcy system and to protect the legitimate interests of the creditors, it's need to introduce the bankruptcy superintendent system clearly in the method of law or judicial interpretation. To adopt creditor meeting appointed system, if to set up it's up to creditor meeting or the creditors'committee. The bankruptcy superintendent should be professional person. The post can be held by the organizations and persons with qualifications of bankruptcy administrator. The managers can be effectively controlled by making clear the power of the bankruptcy superintendent.