The ramification of Bankruptcy Law and the restructuring rights for the protection of creditors

Abstract

The present paper focuses on the development process of bankruptcy throughout history. Initially, the historical examination indicates that insolvency has been furtively discussed in the Jewish tradition, which also influenced Christian doctrines regarding the matter later. On the other hand, in Ancient Rome, insolvency had significant and opposite consequences, due to the importance given to interests of creditors as well as humiliation of debtors. In the course of time and until the half 19th century, there was a steady predominance of procedures aiming to liquidate the assets of the debtor. However, the occurrence of bankruptcies which involved railway companies in the United States led to the later development of the Chapter 11 of its Bankruptcy Code, which allows  ebtors to resume their economic activities and pay off their existing debts. Such procedure has revealed a successful and paradigmatic change in bankruptcy law, having later spread in the whole world. In this context, the paper also presents future prospects for bankruptcy law, as well as the development of bankruptcy law in connection with varied subjects of law, such as natural persons, legal persons governed by public laws, small companies, and the  economic causes for such ramifications.