The first personal bankruptcy case in China granted by the Shenzhen court

Bankruptcy protection

The Shenzhen Intermediate People’s Court in southern China’s Guangdong Province granted a personal bankruptcy petition on Monday, the first such case since the relevant laws came into force in March.

The request was filed by Liang Wenjin, a local entrepreneur in the Bluetooth headphone industry whose company went bankrupt due to unstable sales and the effect of the COVID-19 pandemic.

According to the request, Liang’s assets were valued at around 40,000 yuan ($ 6,167), and his fixed monthly income of 20,000 yuan cannot immediately cover his debts of 750,000 yuan.

Monday’s court ruling means Liang has three years to repay all of the principal to his creditors, with no interest or late fees.

Liang said he received seven to eight phone calls from debt collectors once a day. “Now my mental stress has been alleviated and I have more energy to pay off my debts,” he said.

According to the Shenzhen Special Economic Zone Personal Bankruptcy Regulations released in March, a portion of Liang’s income, except for about 7,700 yuan for his and his wife’s daily expenses, will be used to reimburse her expenses. debts.

The Shenzhen Intermediate People’s Court said the personal bankruptcy law gives those who are honest but suffer bad luck a chance.

“The approval has important significance in the field of personal bankruptcy protection in China,” Li Weimin, director of the Beijing Wei Bo law firm, told the Global Times on Monday.

“Before the settlement, people who might not be able to repay their debt would have been blacklisted from China’s personal credit system,” Li said, adding that the court ruling fills a loophole in the laws. China on personal bankruptcy protection.

Protection regulations are currently only available to residents of Shenzhen, but authorities are committed to improving bankruptcy protections nationwide.

The fourth plenary session of the 19th Communist Party of China Central Committee in 2019 highlighted the need to improve the country’s bankruptcy system.

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