Passing the amendment of the Bankruptcy Law

An amendment of the bankruptcy law passed on March 24, 1993 became effective on April 22, 1993. Bankruptcies and settlements play a special role in all modem legal systems, as the market economy needs special legal instruments for the solution of extreme situations such as the bankruptcy of an economic legal entity (company). The main purpose of bankruptcy proceedings is to evenly distribute the economic losses among the creditors affected by bankruptcy. The legal provisions for bankruptcy are very useful and indispensable for companies operating under market conditions. Act No. 328/1991 Coll. on Bankruptcy Settlement was passed in 1991, and its amendment became effective on April 22, 1993. The amendment provides for starting bankruptcy and settlement procedures and uses economic instruments for preventing losses resulting from bankruptcy.