| Indicator |
Answer |
Score |
|---|
| Proceeding |
foreclosure |
The most likely applicable proceeding for the Mirage's case (see methodology) would be a foreclosure by judicial sale. After Mirage's default, BizBank would initiate the foreclosure by filing an application with a District Court in Yangon. |
| Outcome |
piecemeal sale |
The hotel will stop operating and Mirage's assets will be sold by the court appointed bailiffs in a public auction. |
| Time (in years) |
5 |
The foreclosure procedure until BizBank is repaid some or all of the money owed to it will take approximately 5 years. Usually after 1 year since Mirage's default, BizBank would initiate foreclosure by filing a petition at the Court. During the above mentioned 1-year period, BizBank needs to obtain formal documentary evidence indicating the endeavors made but failed to solve the payment issue. After receiving the application, it takes at least half a year for the Court to review the case, notify Mirage and hold hearings until the final order is made. Within the following 1.5 to 2.5 years, the Court would make a final decision on BizBank's claim after rounds of legal debates. Then it takes another year for the Court to pass an execution order based on which BizBank will be entitled to open an execution proceeding. In addition, the court needs to decide on all the third party claims, including tax authorities, which usually be settled within 1 year. After announcing the execution of the foreclosure proceeding, the Court will appoint a bailiff/judicial receiver to gather information on Mirage's assets, prepare them for sale and conduct the sale in a public auction. It takes approximately 1 year to complete the sale and distribute proceeds. |
| Cost (% of the estate) |
18 |
The costs associated with the case would amount to approximately 18% of the value of the debtor's estate. The cost incurred during the entire insolvency process mainly includes attorneys' fees (10%), auctioneer's fees (3%), fees of accountants and other professionals (4%) and court's fees (1%). |
| Recovery rate (cents on the dollar) |
5 |
14.7 |
| Strength of insolvency framework index (0-16) |
|
4.0 |
| Commencement of proceedings index (0-3) |
|
2.0 |
| What procedures are available to a DEBTOR when commencing insolvency proceedings? |
(b) Debtor may file for liquidation only |
0.5 |
| Does the insolvency framework allow a CREDITOR to file for insolvency of the debtor? |
(b) Yes, but a creditor may file for liquidation only |
0.5 |
| What basis for commencement of the insolvency proceedings is allowed under the insolvency framework? |
(a) Debtor is generally unable to pay its debts as they mature |
1.0 |
| Management of debtor's assets index (0-6) |
|
2.0 |
| Does the insolvency framework allow the continuation of contracts supplying essential goods and services to the debtor? |
No |
0.0 |
| Does the insolvency framework allow the rejection by the debtor of overly burdensome contracts? |
Yes |
1.0 |
| Does the insolvency framework allow avoidance of preferential transactions? |
Yes |
1.0 |
| Does the insolvency framework allow avoidance of undervalued transactions? |
No |
0.0 |
| Does the insolvency framework provide for the possibility of the debtor obtaining credit after commencement of insolvency proceedings? |
No |
0.0 |
| Does the insolvency framework assign priority to post-commencement credit? |
(c) No priority is assigned to post-commencement creditors |
0.0 |
| Reorganization proceedings index (0-3) |
|
0.0 |
| Which creditors vote on the proposed reorganization plan? |
n/a |
0.0 |
| Does the insolvency framework require that dissenting creditors in reorganization receive at least as much as what they would obtain in a liquidation? |
No |
0.0 |
| Are the creditors divided into classes for the purposes of voting on the reorganization plan, does each class vote separately and are creditors in the same class treated equally? |
No |
0.0 |
| Creditor participation index (0-4) |
|
0.0 |
| Does the insolvency framework require approval by the creditors for selection or appointment of the insolvency representative? |
No |
0.0 |
| Does the insolvency framework require approval by the creditors for sale of substantial assets of the debtor? |
No |
0.0 |
| Does the insolvency framework provide that a creditor has the right to request information from the insolvency representative? |
No |
0.0 |
| Does the insolvency framework provide that a creditor has the right to object to decisions accepting or rejecting creditors' claims? |
No |
0.0 |
