The law that allows people to declare insolvent in Guatemala was approved in 2022. However, since then two factors necessary for their implementation in the country have not been completed: a regulation and a regulation of bankruptcy creditors, this explained by Valeria Prado, Vice Minister of Registry Affairs of the Ministry of Economy (Mineco).
The so -called registry of bankruptcy creditors must be created within the Vice Ministry of Registry Affairs, Prado explained. However, for the creation of this new registration, it is necessary to modify the Mineco Organic Regulation.
A bankruptcy creditor is any person or entity to which the company bankrupt owes money before it is declared in insolvency.
For this reason, Prado stressed that the government agreement was sent to reform the regulation to the National Civil Service Office (ONSEC), since, without its approval, it is not possible to create the places to administer the registration. However, according to Prado, so far no feedback has been received from the ONSEC. From this, the Vice Minister acknowledged that it is not sure when such registration could begin to work.
For Amán Sánchez, a business climate specialist lawyer, registration is essential for the proper functioning of the insolvency regime in the country. “His work is to guarantee transparency, access to information and prove certain people as bankruptcy administrators,” said Sánchez.
Key figure for business recovery
The registry of bankruptcy creditors, according to Sánchez, is responsible for proving all those people who work in the processes together with the judicial body and who, in their opinion, are indispensable for the regulation of bankruptcy. Bankruptcy administrators will be responsible for verifying the entire financial situation of the debtor and could even establish their possibilities to get out of insolvency.
This means, said Sánchez, that the bankruptcy administrator will be all that professional who, during the process, Act as an independent third party, verify the advantages and disadvantages of the debtor and look for a plan to overcome its insolvency situation. “The bankruptcy administrator will be the one looking for solutions to make the payments, or who indicates that nothing can be done for the company,” said Sánchez.
For the accreditation of said administrators, Sánchez argued that the registration must also be responsible for an exam to certify interested professionals. This must be done through the Mineco and with the universities of the country as allies, according to the lawyer.
Among the positions that should be created from the ONSEC are the registrar, subregistor and administrative staff, Prado explained. After the favorable opinion by the ONSEC, the reforms must go to the Technical Directorate of the Ministry of Finance (MINFIN), then to the Attorney General’s Office and, finally, to the General Secretariat of the Presidency for its final opinion. Sanchez said that, since the registration was already created by law, the Mineco could begin with the appointment of the authorities, who could contribute to the end of the regulation that continues pending.
Insolvencies Regulation
On the other hand, in terms of the insolvencies regulation, which is still pending after two years, Prado stressed that they received approval from the PGN to continue with the corresponding procedure. After the approval of the PGN, Prado mentioned that the regulation was sent to the General Secretariat of the Presidency, which sent the document with change requests.
The next step, according to Prado, was to send the regulation to the judicial agency, since, said the vice minister, this entity will be responsible for applying the insolves law. “That is, through the judicial means, the origin of the bankruptcy creditors process is declared or not,” Prado argued. The regulation was sent about a month ago, but they have not yet received an answer.
However, Prado said that in approximately three or four months they could publish the regulation with the changes requested by the PGN and the General Secretariat of the Presidency, which, said the vice minister, were only in a form and not in the background.