Reconciliation Proposal In A Bankruptcy Process

In a bankruptcy process, the debtor shall have the right to propose the reconciliation to the creditors even when debtor is declared bankrupt. Pursuant to article 144 of Law No. 37 year 2004 of the bankruptcy and the Suspension of Obligation For Payment of Debts (Bankruptcy Act),  bankruptcy debtor reserves the right to offer a reconciliation to all creditors.

The content of the reconciliation proposal shall contain the offer and the commitment of the bankruptcy debtor concerning the repayment of debt to the creditors to accept the reconciliation, including the calculation of the amount of debt acknowledged by the debtor, following with the amount of the debts to be paid by the Debtor, explanations of the source of funds used to make the debt payments, and other things that can be used as a consideration by the creditors to accept the proposal of the reconciliation.

The Reconciliation Proposal shall be made within no later than 8 (eight) days before the meeting for verification of the claims. The reconciliation proposal shall be made available at the Court Registrar's office by whomsoever without any charge and made public at the Court Registrar's office.  A copy of the reconciliation proposal shall be delivered to each member of the temporary Creditors committee. The Curator and the temporary Creditors committee shall give written opinion on the draft of reconciliation at verification of claims meeting (Article 146 Bankruptcy Act). The reconciliation proposal shall be discussed and decided after the verification of claims meeting, which the date is set by the supervisory judge no later than 21 days. After the acceptance of the reconciliation proposal, the creditor can give his opinion on the reconciliation proposal offered by debtor, expressed in writing and also delivered orally at verification of claims meeting. Pursuant to article 150 of Bankruptcy Act, the bankrupt debtor shall be entitled the right to give information and defend such reconciliation proposal and to make alterations to such reconciliation proposal plan to reach a consensus during the process of deliberation.

The reconciliation proposal shall be accepted if approved at the Creditors meeting by more than 1/2 (one half) of the total of concurrent Creditors attending the meeting and whose rights are admitted, or are temporarily admitted, who represent no less than 2/3 (two-thirds) of the total concurrent claims which are admitted or temporarily admitted by concurrent Creditors or their Attorneys-in-fact attending such meeting.

Suria Nataadmadja & Associates Law Firm

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