Bankruptcy protection Bankruptcy protection means that no matter whether the debtor is solvent or not, when the debtor voluntarily files an application for bankruptcy reorganization with the court or the creditor forces him to file an application for bankruptcy reorganization, the debtor will put forward a bankruptcy reorganization plan to make arrangements for the time limit and method of debt repayment and the possible losses of some creditors and shareholders. This plan should be put forward in a certain period of time, and the debtor can continue to operate after it is approved by the creditors and confirmed by the court.

First, the purpose of bankruptcy protection, the core of bankruptcy protection is to create a special repayment priority for restructuring financing. Without this priority, reorganizers usually face a pair of contradictions: in order to reorganize, they must obtain new financing to maintain the operation of the enterprise, and also pay the high expenses arising from the reorganization steps such as asset reduction, structural adjustment, business restructuring and employee dismissal, but few people dare to lend money to enterprises on the verge of bankruptcy, especially after most of their assets have been mortgaged. Gasser. This is impossible in traditional civil law.

In the United States, if once an enterprise applies for bankruptcy protection, its creditors are temporarily unable to recover the creditor's rights of the enterprise, the enterprise can have a breathing space. We can find a way while filing for bankruptcy protection. Once the company passes bankruptcy protection and walks out of the bankruptcy court, it is equivalent to getting rid of debts and can go into battle easily.

In addition to safeguarding the local interests of enterprises and individuals, bankruptcy protection is also conducive to preventing a large number of unemployment, which is of positive significance to alleviating social contradictions and maintaining social stability.

2. How to Apply for Bankruptcy Protection According to the Supreme People's Court's Provisions on Several Issues Concerning the Trial of Enterprise Bankruptcy Cases, the debtor who applies for (is applied for) bankruptcy shall have the legal person qualification, while enterprises, individual industrial and commercial households, partnership organizations and rural contracted households without the legal person qualification shall not have the bankruptcy subject qualification. When a state-owned enterprise applies to the people's court for bankruptcy, it shall submit a document that its superior competent department agrees to its bankruptcy; Other enterprises shall provide documents that the founder or shareholders' meeting decides the bankruptcy of the enterprise.

When applying for bankruptcy, the debtor shall submit the following materials to the people's court:

(1) A written bankruptcy application;

(2) Enterprise qualification certificate;

(3) A list of the legal representatives and principal responsible persons of the enterprise;

(four) the situation of enterprise employees and the resettlement plan;

(5) A written explanation of the losses of the enterprise, with an audit report attached;

(six) the list of assets of the enterprise as of the date of filing for bankruptcy, including tangible assets, intangible assets and enterprise investment. ;

(seven) the details of the account opened by the enterprise in the financial institution, including the approval materials, account number, funds, etc.;

(8) A statement of enterprise's creditor's rights, indicating the debtor's name, domicile, debt amount, occurrence time and repayment requirements of the enterprise;

(nine) the enterprise debt statement, indicating the enterprise name, domicile, the amount of creditor's rights and the time of occurrence;

(10) The guarantee involved by the enterprise;

(eleven) the lawsuit that has occurred in the enterprise;

(twelve) other materials that the people's court deems necessary. When applying for bankruptcy of the debtor, the creditor shall submit the following materials to the people's court:

(a) the facts and evidence of the creditor's rights;

(two) the nature and amount of the creditor's rights, whether there is a guarantee, and attach evidence;

(3) Evidence that the debtor is unable to pay off due debts.