The legislative Committee of the Knesset approved second and third readings promoted by the Minister of justice Ayelet shaked, a draft law on bankruptcy, which should replace the three old directives, two of which are from the time of the British mandate.
The bill, consisting of 375 items were discussed by the Commission for 20 months. During this period it has held 32 meetings.
The new bill changes the approach to bankruptcy, moving from a policy of punishment to a policy of rehabilitation of debtors, especially if we are talking about small businesses, the owners of which, after four years of rehabilitation to obtain debt forgiveness.
In addition, the bill increases the share of small creditors in the division of property by the banks and the state. For this the state, the municipalities and the banks will partially waive the priority rights to debt collection.
The bill also provides for special responsibility of members of boards of Directors and CEOs of companies that are in the position of bankruptcy, but not yet recognized by the court.