Legal nature of the institution of insolvency of individuals

Abstract

With the entry into force of the Code of Ukraine on Bankruptcy Procedures, the norms governing the recognition of a natural person as bankrupt began to apply to all natural persons, regardless of whether they have the status of an entrepreneur. This became a new stage in the history of the development of domestic insolvency (bankruptcy) law, since now the participants in the economic process are natural persons, whose debts are not related to the implementation of economic activity, and the court, in whose proceedings such a case is pending, can deal with legal relations, which were traditionally considered by general courts in civil proceedings. All this determines the need to clarify the legal nature of the institution of insolvency of natural persons. The purpose of the article is to clarify the legal nature of the institution of insolvency of individuals and the place of this institution in the legal system of Ukraine. The author considered the approaches that exist in legal science regarding the legal nature and place of the institution of insolvency of a natural person. It is emphasized that since the issues of bankruptcy and insolvency have historically always been in the scope of economic law and process, and the introduction of the possibility of declaring bankrupt individuals without such status, along with the bankruptcy of natural persons – entrepreneurs, does not mean the transfer of these legal relations to the sphere of civil law. Rather, the opposite is the case here - the spread of economic and legal norms to the peculiarities of legal regulation of the status of natural persons without the status of a subject of entrepreneurial activity. It is substantiated that during the time of its existence, commercial courts have demonstrated quality and efficiency in resolving commercial disputes, including developing an effective toolkit for considering bankruptcy cases, which is currently effectively used in the case of insolvency of individuals. The concentration of all disputes involving the debtor within the insolvency case of a natural person was analyzed. It was emphasized that from the moment of the opening of proceedings in the case of insolvency of an individual, all disputes arising regarding the latter’s property interests are decided by the commercial court.