Section I Receiver

(1)

(Amended - SG 70/1998) Natural persons may become receivers.

(2)

(Amended - SG 70/1998) The receivers shall conform with the following requirements:

1.

not to have been convicted as a citizen of lawful age for general offence, except for the cases of exoneration;

2.

not to be spouse of the debtor or creditor and not to be in kinship relations with any of them in direct descent and lateral branch to the sixth degree, and in-law lineage up to the third degree;

3.

not to be a creditor in the bankruptcy procedure;

4.

not to be a bankrupt debtor whose rights have not been reinstated;

5.

not to be in any relations with the debtor or creditor, which may generate substantiated doubts as to his impartiality.

6.

(New - SG 70/1998) to be graduated in Economics or in Law and to have at least 3 years professional experience on this subject;

7.

(New - SG 70/1998) to be included in the list of the persons nominated to became receivers, which is approved by the Minister of Justice and European Law Integration and promulgated in the State Gazette.

8.

(New - SG 84/2000) not to have been released as a receiver in bankruptcy pursuant to Art. 657, Par. 2 of this Law and Art. 64, Par. 1 of the Bank Law;

9.

(New - SG 84/2000) not to have been excluded , except by own will from the lists under item 7 and Art. 58, Par. 2 of the Bank Law.

(3)

(Amended - SG 70/1998, Supplemented SG 84/2000 ) The Minister of Justice and European Law Integration shall expel from the list under paragraph 2 item 7 the persons for whom it is established that are commiting  contravention in connection with  their activity as receivers, regardless whether the offense has been established by the bankruptcy court. This amendment shall be promulgated in the State Gazette.

(4)

(Supplemented SG 84/2000 ) Receiver powers may be exercised by several persons. In such cases, decisions shall be made unanimously and actions shall be undertaken jointly, unless the meeting of creditors or court in case of dispute between the persons acting as receivers, decides otherwise.

(5)

When receiver powers are exercised by several persons, making decisions unanimously and acting jointly, they shall be liable jointly and severally under Art. 663, paragraphs 2 and 3.

(1)

The bankruptcy court shall appoint a receiver, elected by  the first meeting of creditors, provided he complies with the requirements under Art. 655 and has given his consent in writing with a notary certified signature. The bankruptcy court shall determine the date for the receiver's taking of his duties upon the same definition.

(2)

At his appointment the receiver shall declare in written form  with a notary  certified signature the presence of the requirements and the lack of the obstructions under this Law,  the participation in business companies as a partner, shareholder, the occupation of liquidator, receiver or other paid positions.

(3)

If a change concerning the circumstances under Par. 2 occur, the receiver shall be obliged to inform immediately in writing the bankruptcy court.

(4)

The receiver shall be obliged to take duties at the date determined by the court. If this obligation is not fulfilled, within 7 days  the bankruptcy court shall replace the appointed receiver with another person nominated by the first meeting of the creditors. If there is no such a person, another one from the respective list shall be the replacing person and a new meeting of the creditors shall be convened. 

(1)

The court shall discharge a receiver in the following cases:

1.

his request in writing sent to the court;

2.

legal disability;

3.

(New - SG 70/1998) the appointed receiver does not meet the requirements of the Article 655, paragraph 2 anymore;

4.

(Former Item 3 SG 70/1998) request by the creditors entitled to two thirds of the receivables;

5.

(New - SG 70/1998) a decision of the meeting of the creditors;

6.

( New -Former Item 5 SG 70/1998 - SG 84/2000) actual inability to exercise his powers;

7.

( New - Former Item 5 SG 70/1998 - SG 84/2000) death.

(2)

The court may discharge the receiver at any time, in the course of the fulfilment of its judicial obligations or at the proposal of the debtor, the committee of creditors or a creditor, when such receiver fails to fulfil his obligations or his actions jeopardise the interests of the creditor or the debtor.

(3)

(Amended - SG 70/1998; SG 84/2000) A receiver discharged under paragraph 1, items 1, 3 and 4 and paragraph 2 shall be obliged to perform his duties until a new receiver is appointed.

(4)

(New - SG 84/2000) Subject to appeal before court shall be :

1.

the definition of the bankruptcy court which leaves without consideration the claim under Par. 1, items 1-6 and  Par. 2;

2.

the definition of the bankruptcy court which considers the claim under Par. 2.

(5)

(New - SG 84/2000) The definition for release of the receiver in bankruptcy shall immediately implemented. The complaint against the definition for release shall not stop its implementation. The repeal of the definition for release of the receiver in bankruptcy shall not reinstate the person as receiver in bankruptcy in this proceedings.

(6)

(New - SG 84/2000) In the cases under Par. 1 and 2 the court shall convene a meeting of the creditors for an appointment of a new receiver in bankruptcy.

(7)

(New - SG 84/2000) In the cases under Par. 1, items 2, 3, 5 and 6 and  under Par. 2 the functions of the receiver in bankruptcy shall be carried out by appointed by the court receiver until the new one is appointed.

(1)

The receiver shall:

1.

represent the enterprise;

2.

manage its current affairs;

3.

(New - SG 84/2000) exercise supervision of the activity of the debtor in the cases under Art. 635, Par. 1.

4.

(Previous item 3 - SG 84/2000) receive the inventory, keep and maintain the books and business correspondence of the enterprise;

5.

(Previous item 4 - SG 84/2000) identify and establish the debtor's property;

6.

(Previous item 5 - SG 84/2000) file requests for terminating or avoiding agreements to which the debtor is a party under the terms and conditions set forth by law;

7.

(Previous item 6 - SG 84/2000) participate in the court proceedings of the debtor's enterprise and bring lawsuits on his behalf;

8.

(Previous item 7 - SG 84/2000) collect the cash receivables of the debtor and deposit them in a special bank account;

9.

(Previous item 8 - SG 84/2000) dispose of the funds in the debtor's bank accounts with the permission of the court when this becomes necessary in connection with the management of the property and its preservation;

10.

(Previous item 9 - SG 84/2000) identify and establish the debtor's creditors;

11.

(Previous item 10 - SG 84/2000) convene and organise the meetings of creditors in conformity with a court ruling;

12.

(Previous item 11 - SG 84/2000) offer a plan under Art. 696;

13.

(Previous item 12 - SG 84/2000) undertake actions to terminate the debtor's participation in companies;

14.

(Previous item 13 - SG 84/2000) cash in the property from the bankruptcy estate;

15.

(Previous item 14 - SG 84/2000) undertake other actions prescribed by law or assigned by court.

(2)

The receiver shall exercise his powers in conformity with the development of the insolvency proceedings and the court rulings.

(1)

(Amended - SG 84/2000) The receiver shall enter each action on his part relative to the management and administration of property or property rights of the debtor or from the bankruptcy estate in a specially bound journal with numbered pages. When the functions of the receiver are carried out by two or more persons the disputes between them and the taken resolutions shall be entered in the journal.

(2)

The receiver shall submit performance reports to the court on a monthly basis or immediately, at request.

(3)

(New - SG 84/2000) The receiver shall present upon request by a creditor the journal under Par. 1 and the report under  Par. 2, and also a report on all the creditors questions to which is not answered in the report.

(1)

(Amended - SG 70/1998) The receiver shall exercise his powers with the due care of a commercial.

(2)

Receivers may not delegate their powers to other persons, except in case of an explicit permission by court.

(1)

Receivers shall get a remuneration for their work - current and final - as determined by the meeting of the creditors. Decision for the way of determination of the remuneration can be taken before the receiver has ended his activity.

(2)

The court shall determine the size of the current remuneration of the temporary receiver as well as of the receiver in case under Art. 657, Par. 6 at the time of his appointment.

(3)

The current remuneration shall be paid monthly.

(4)

The final remuneration of the receiver shall be determined in compliance with the following:

1.

fulfilling the procedure terms;

2.

whether the taking list accepted by the receiver has been approved  by the court without changing it;

3.

the activities carried out and the granted claims for supplementing the bankruptcy estate;

4.

termination of the proceedings because of an approved recovery plan;

5.

cashing the property at the moment of declared bankruptcy;

6.

other circumstances important for the term of the proceedings and for the bankruptcy estate. 

(5)

The final remuneration can also be determined as a percent of the property that filled the bankruptcy estate or/and as a percent of the value of the cashed assets.

(6)

In the cases when the meeting of the creditors was not able to decide to choose a receiver or the size of his remuneration, the decision for these shall be taken by the court.

(1)

(Amended - SG 84/2000) The receiver may not negotiate on behalf of the debtor either with himself or with related person.

(2)

Receivers may not acquire in any way, directly or through another person, any chattel or right from the bankruptcy estate. This restriction applies also to the their spouses, relatives in direct descent and lateral branch to the sixth degree and in-law lineage up to the third degree.

(3)

Receivers shall not disclose any information, data or facts which have become known to them in the course of exercising of their powers.

(4)

(Repealed - SG 70/1998)

(1)

Where the receiver fails to perform his duties or performs them poorly, the court may impose a fine which, for each individual case, may not exceed the amount of his monthly remuneration.

(2)

The receiver is liable to pay a compensation equal to the interest determined by operation of law for any delay on his part to deposit the funds received in the bank.

(3)

The receiver is liable to compensate the debtor and creditors for the damage inflicted by him to them in the course of the exercising of his powers.

(1)

Receivers shall submit a report in writing upon the termination of their work within a term prescribed by the court.

(2)

The newly appointed receiver, the debtor, the creditors' committee or a creditor may raise objections to the report within seven days after its submission.

(3)

(Supplemented SG 84/2000) The court shall, within 14 days from the receipt of the objection, issue a ruling on the objection, which will be final and not subject to appeal.

(4)

Should no objection be raised within seven days, the report will be considered accepted.

Upon termination of his activities, the receiver shall immediately submit, by inventory list,  the books the journal and the reports under Art. 659, as well as the property at his governance  to the newly appointed receiver or a person designated by the court or to the debtor in the cases set forth in Art. 707, paragraph 1.

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