Pondering And Reconstructing On The Order Of The Claims In Bankruptcy

Enterprise Bankruptcy Law of our country has experienced two series of improvements. The current bankruptcy law is adopted from the 2006 National People’s Congress, namely the "People’s Republic of China Enterprise Bankruptcy Law." Compared with the old bankruptcy law, a new bankruptcy law in the settlement of claims overall institutional, labor claims, the secured creditor and the national debt are further divided. However, with the development of society and progress, that system has become increasingly difficult apply to the complexity of interpersonal relation and complicated social conflicts.The reason is that the ranking of the priority level of property is highly generalized, in which has not been further distinguished for the same ranking obligatory right. Under the circumstance of an enterprise bankruptcy debt settlement, it is still questionable whether such an extensive distribution patterns could promote balancing the interests of all parties of bankruptcy. It is debatable to achieve substantive justice. As a consequence, it is again necessary to study the issue of the sequence of the liquidation of creditor’s rights system at new social and economic settings in current China.At present, there are three main issues existed in enterprise bankruptcy liquidation in China. Foremost, the conflicts between ensured claim and personal claim are evident. In common cases of the victims of large-scale infringement, they are usually limited by absolute priority of ensured claims, thus they are lacking effective remedy. The reason to this is not only common claim laid the last in legal hierarchical bankruptcy liquidation system, as well as the deficiencies of public value and efficiency value. Secondly, the complications of constitution of labor claim: the existing bankruptcy laws are categorized as many as six types, which could have arranged according to the vital interest of each individual. Whereas the current bankruptcy are roughly summed them up as secondary priority claims, of which are lacking precise division. Thirdly, lowering the priority of tax claim is the global tendency; the way our country insists on prioritizing tax claim may cause marketing risks and cost increase. With all questions exposed above, and the discussion of individual bankruptcy liquidation, there are complications among legal principle and common value, law and economy, personal right and property right. Through discussion of secured claims, labor claims, tax claims and general flawed claims in practice as well as the summary of controversial theoretical issue, this paper further propose that certain priority given to personal debt, limiting the absolute priority security interest repayment, national tax claims and labor claims hierarchical priority for repayment, etc. as well as establish our national bankruptcy claims liquidation overall values.