Abstract
In order to achieve the fundamental principle of civil and international right 'pacta sunt servanda', and preserve legal safety at the same time, the law introduced the institution of bankruptcy as a form of settling with the creditors in a situation when the debtor becomes insolvent i.e. unable to pay. When initiating bankruptcy proceeding, it is not relevant whether the debtor is a natural or legal person, because that is a universal procedure which applies to all subjects which may not fulfill their assumed obligations. However, bankruptcy of a natural person is not a novelty in our bankruptcy law. Bankruptcy proceeding over a natural person was known in the bankruptcy law of the Kingdom of Yugoslavia in 1929. Also, during bankruptcy, there is a proportional division of insolvency risk of the debtor to all creditors whereby it is prevented for some creditors to be satisfied entirely and not to have any settlement with the rest, which is a realistic danger with the regular enforcement proceeding.
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