OREANDA-NEWS. November 01, 2011. The procedure of enterprises' insolvency will be simplified. The government approved a draft law on insolvency.

Economics Minister Valeriu Lazar said the legislation on the matter is imperfect. He noted that "instead of cleaning the economic area from enterprises with problems transparently and lawfully, we created a business for some people who have been delaying this procedure for years". In these conditions, the situation at these enterprises does not improve, and their assets are disintegrated, the economics minister emphasized.

The new law provides for a shorter period of declaring enterprises as insolvent, as well as for a wider range of instruments for the reorganization of enterprises. Once the law is passed, this procedure will last about three years, against cases when this process has been dragged for nine years.

For instance, the process of insolvency of the Termocom enterprise lasts almost nine years. Two deadlines have been offered for the reorganization of this enterprise, and the last three-year deadline, granted by the government, expires on 5 February 2012. Lazar said the consumers will only lose from this, given that, as long as the enterprise is in this condition, no investments are coming, the company s equipment is outdated at a level of 80 per cent and the heating rates are high. Presently, the enterprise has historical debts of over two billion lei.

To enter into force, the draft law on insolvency needs to be considered and adopted by the parliament.