Lithuania : Insolvency and Creditor Rights Systems
The legal environment in Lithuania to support creditor rights and debt enforcement is reasonably effective, and collateral regimes have been largely centralized and modernized. Consistent with a modern system, security interests may be granted in i...
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| Format: | Insolvency Assessment (ROSC) |
| Language: | English en_US |
| Published: |
Washington, DC
2013
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| Subjects: | |
| Online Access: | http://documents.worldbank.org/curated/en/2002/02/6568323/lithuania-report-observance-standards-codes-rosc-insolvency-creditor-rights-systems http://hdl.handle.net/10986/15091 |
| Summary: | The legal environment in Lithuania to
support creditor rights and debt enforcement is reasonably
effective, and collateral regimes have been largely
centralized and modernized. Consistent with a modern system,
security interests may be granted in immoveable and moveable
assets, including equipment, inventory, goods, receivables,
and future property. In practice, security tends to be
restricted to more reliable and liquid assets, such as
immovables or fixed assets. Markets for moveable assets
remain poorly developed or illiquid. Appeals remain a source
of delay, and other procedures could be improved. The
insolvency process in Lithuania has been almost exclusively
one of liquidation, plagued by delay and procedural
obstacles. A new insolvency law was adopted in July 2001,
bringing to three the number of insolvency laws currently in
effect. At the same time, a new Enterprise Restructuring Law
became effective. As of November 2001, only a few cases had
been filed under the new law, which a growing consensus of
stakeholders consider to be unworkable and unfavorable to
creditors. The process may be aided by the developing
training guides and programs. Regulation of insolvency
remains fragmented and weak, but shows evidence of an
evolving structure. Court efficiency is stifled by a lack of
specialization among judges, who are overloaded and poorly
equipped to deal with bankruptcy cases, especially
rehabilitations. The administrators' profession is
marked by low standards, over-licensing, inadequate training
and skills, and inconsistent performance. While much remains
to be done, the national association of bankruptcy
administrators is working to improve licensing standards and
to strengthen continuing education and training for its members. |
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