Core Viewpoint - The revision of the Enterprise Bankruptcy Law, after 18 years, aims to address practical challenges and enhance the legal framework for bankruptcy, reflecting modern bankruptcy law concepts and responding to market needs [2][4][6]. Group 1: Key Features of the Revision - The revision adds and modifies over 160 provisions, expanding the law from 136 to 216 articles, and introduces new chapters on financial institution bankruptcy and simplified procedures for small and micro enterprises [6][10]. - It emphasizes the importance of bankruptcy law as a fundamental tool for market exit and risk management, aiming to optimize the business environment and deepen supply-side structural reforms [6][8]. - The revision addresses issues such as low willingness to use bankruptcy procedures, difficulties in execution, and the need for better protection of creditor rights [6][8]. Group 2: Addressing Practical Challenges - The current law has limitations, including a narrow scope of application, inadequate management systems, and a lack of simplified bankruptcy procedures for small enterprises [4][5]. - The revision introduces a special chapter for financial institutions, recognizing their unique characteristics and establishing differentiated arrangements for their bankruptcy processes [10][11]. - It aims to improve the efficiency of bankruptcy procedures and provide a "green channel" for small and micro enterprises, allowing for quicker resolutions and reduced costs [15][16]. Group 3: Enhancements to Management and Protection Mechanisms - The revision strengthens the role of bankruptcy administrators, clarifying their responsibilities and enhancing oversight to protect creditor interests [20][21]. - A proposed bankruptcy guarantee fund aims to address the issue of "no assets to liquidate" cases, ensuring that bankruptcy procedures can proceed smoothly [21]. - New temporary measures are introduced to prevent "debt evasion" during the period between the bankruptcy application and court acceptance, enhancing asset protection [22][23]. Group 4: Future Directions and Legal Framework - The revision allows for the potential introduction of personal bankruptcy legislation based on pilot experiences, reflecting a cautious approach to expanding bankruptcy protections [8][12]. - It emphasizes the need for coordination between bankruptcy law and other financial regulations to create a comprehensive legal framework for financial risk management [12][13]. - The revision seeks to balance the interests of creditors and debtors, ensuring fair treatment while promoting efficient market exits for struggling enterprises [18][24].

Core Viewpoint - The draft amendment to the Enterprise Bankruptcy Law, proposed for the first time after 18 years, aims to modernize the bankruptcy legal framework, addressing practical challenges and enhancing the system's effectiveness in risk prevention and resolution [1][4]. Summary by Sections Current Legal Shortcomings - The existing bankruptcy law has significant limitations, including a narrow scope of application, an incomplete administrator system, and inadequate protection for creditor rights [2][3]. - Only 0.5% of companies were deregistered due to bankruptcy in 2024, indicating underutilization of the bankruptcy law [2]. Key Features of the Draft Amendment - The amendment expands the law from 12 chapters and 136 articles to 16 chapters and 216 articles, adding over 160 new and modified provisions [4]. - It emphasizes the importance of bankruptcy law as a fundamental tool for market exit and risk management, aiming to optimize the business environment and deepen supply-side structural reforms [4][5]. Financial Institutions - A new chapter specifically addressing the bankruptcy of financial institutions has been added, reflecting their unique characteristics and the need for differentiated arrangements [6][7]. - The amendment includes provisions for special debt repayment rules and enhances the connection between administrative risk management and judicial bankruptcy processes [6][7]. Small and Micro Enterprises - The draft introduces a special bankruptcy procedure for small and micro enterprises, aimed at improving efficiency and reducing costs associated with bankruptcy proceedings [10][11]. - This new procedure allows for quicker resolution of cases, with specific provisions for simplified management and expedited timelines [11]. Management and Oversight - The amendment strengthens the role and responsibilities of bankruptcy administrators, ensuring they operate independently while being supervised by creditors [15][16]. - A proposed "Bankruptcy Guarantee Fund" aims to address the issue of costs in bankruptcy cases where assets are insufficient to cover expenses [15][16]. Preventing "Debt Evasion" - New temporary measures are introduced to prevent debtors from transferring or hiding assets during the bankruptcy application process, enhancing the integrity of the proceedings [17][18]. - The draft also imposes strict obligations on debtors and their management to disclose financial information accurately and prohibits unnecessary expenditures during bankruptcy [18].