Procedural status of subordinated creditors depending on the jurisdiction of their location

the article examines the procedural status of subordinated creditors, taking into account the provisions of the Review of the Supreme Court of the Russian Federation dated January 29, 2020. As a result of the study of judicial practice, contradictions in the positions of the courts have been revealed, the courts interpret the provisions of the Review rather narrowly and do not provide subordinated creditors with sufficient tools to protect their rights. The economic situation in Russia is unstable and volatile, which requires an understanding of the legal status of subordinated creditors, constant changes in bankruptcy legislation require analysis and adaptation, and understanding the status of subordinated creditors is important for investors and financial institutions. For a long time, Russia lacked a mechanism for regulating the subordination of creditors, and the Supreme Court of the Russian Federation adopted an approach in which loans from affiliated companies are considered subordinated. The main purpose is to examine the rules of subordination in foreign countries and in Russia, and identify the main principles and differences. In Russia, subordinated creditors receive payments last. The current approach of the courts to the restrictive interpretation of the procedural rights of subordinated creditors is conceptually incorrect. Based on the analysis of judicial practice and foreign experience, the authors propose ways to improve current legislation that will help protect the rights of subordinated creditors, while reducing abuse by affiliated companies and strengthening legal certainty in the allocation of assets in bankruptcy. The authors propose to consolidate the concept of a subordinated creditor and the criteria for classifying creditors as such, limit the order of satisfaction of creditors' claims, determine the scope of rights and procedural status of subordinated creditors, define procedures for challenging transactions involving subordinated creditors, and establish mandatory registration of such loans and disclosure of information about them.

insolvency (bankruptcy), downgrading (subordination), creditors, subordinated creditors, rights of subordinated creditors, abuse of affiliated persons