Senate sends Insolvency Act amendment back to lower house

The Senate has returned an Insolvency Act amendment to the Chamber of Deputies in part because the upper house wants to make it easier for the poorest to qualify for debt relief or declare personal bankruptcy.

Senators also proposed abolishing a condition that repayment to creditors equal the cost of the insolvency trustee's remuneration. The current version was supported by Minister of Justice Jan Kněžínek (for ANO).

Statistics show close to one in ten Czech adults face financial execution. Currently, a person who pays off at least 30 percent of their debts within five years is eligible for debt relief. Their remaining outstanding debt is then forgiven.

Among other measures, MPs have been debating introducing a “fast-track” model that would allow a person who repays half their liabilities in three years to qualify for debt relief.

Author: Brian Kenety