Bankrupt.Me-Not. Book of Problems
Bankruptcy is not death. It may seem hard to believe but bankruptcy can bring salvation.This book describes the rules of survival, the problems to be solved in preparation for bankruptcy, if it can no longer be avoided, and gives an understanding of the full range of extralegal measures.It also offers an insight into the safeguards, which are a tactic for building your future business – the survivor that is debt- and loan-free.The book is based on true events and the author’s own experience.
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Project manager Alexey Perevedentsev
Translator Andrei Piven
Translator Irina Piven
Illustrator Vitaly Blokhin
© Yuriy Yavorsky, 2023
ISBN 978-5-0060-6444-7
Created with Ridero smart publishing system
First published in 2020.
All rights reserved. No part of the electronic version of this book may be reproduced in any form or by any means, including posting on the Internet and in corporate networks, for private and public use without the written consent of the copyright owner.
INTRODUCTION
This is more like a study guide rather than a book as such. Do you remember what a math book used to be called? A book of problems. It was easier for younger pupils and more challenging for senior ones. Either way, it contained problems to be solved. The right answers were given at the end of the book, but we had to go all the way to the solution by ourselves.
At the end of 2014, the Russian economy suffered another blow when oil prices more than halved. Naturally, the Russian ruble immediately collapsed against the dollar and the euro.
As the old Russian adage goes, “misfortune never comes alone.” It was exactly at this point that the Russian government felt compelled to take a heavy-handed approach to the economy, declaring a policy of import phaseout. The implication was that if a business can survive one misfortune, it will survive another. Those who can keep their heads above water will build the new Russian economy.
The course was set for the development of multi-level processing and high technology. The government slapped a ban on foreign materials that could no longer be used to manufacture end products for government agencies (including partially government-owned monopolies, which at the time accounted for over 90% of the country’s economy). This was impossible for many businesses, as they simply could not replace the materials and equipment overnight, nor could they invent or buy the new technology. By mid-2015, the economy had plunged to the brink of bankruptcy. Only one question remained: who would go bankrupt next?
It was far more than a disaster for millions of different businesses. It became the beginning of the end for an economy that had lived off imported materials and reselling of imported technology. That was when the most venturesome entrepreneurs ‘crash-dived’ into preparations for bankruptcy. It truly felt like a submarine dive: perfect concentration, steady nerves, unflappable composure, the whole crew ready to steer only one course – for survival.
This was not the first time, nor will it be the last. Crises are as numerous as storm waves, and we must learn to deal with them. Theory will no longer help. What matters is practice. It is for this reason that the book is based on real events. They may not be described with pinpoint accuracy, but the conclusions are sincere. You know, as the credits of a film sometimes say: “Any resemblance to actual people or real events is purely coincidental.” It is the same here. There may not have been identical situations, but the description is still 50—60% fair and square.
I believe that many businessmen and lawyers in Russia and abroad will corroborate my research. You can read a lot of books on bankruptcy and memorize almost all the legislative and judicial practice related to this tricky step, but you can never know where it may lead. Having studied a large number of related Russian and international cases, I dare to say that bankruptcy is neither death nor even an incurable disease. It is merely a vehicle for getting rid of liabilities that have suddenly become a deathly stranglehold on a business of any size.
That is why I would like to share my research results with you.
SECTION 1. MISTAKES
It’s axiomatic to learn from the mistakes of others.
PROBLEM 1
Given: no nuptial agreement. Businessmen share the ups and downs of both life and business with their families. No one would think of signing a nuptial agreement with their spouse.
Question: why is it important? Nearly everyone who one day decides to act as a guarantor by putting their signature under the text, hardly ever reads it before signing, nor will they re-read it after the hearing. However, everything given away as a present or sold during the three years, or 36 months to be precise, or 1,095 days to be exact before the court declares the company or the individual bankrupt, will be returned to the bankruptcy estate to be sold to settle the defaulter’s debts.
Solution: make sure to sign a nuptial agreement to avoid a lot а trouble for your family in the event of an unexpected bankruptcy.
PROBLEM 2
Given: consolidation of assets in the hands of a single person. It would seem perfectly logical to consolidate the successful parts of the business, to build the logistics and management systems in such a way that the business can be easy to manage and efficient. Training programs that teach that cost a lot of money, the experience comes with age and working your fingers ‘bloody’, while businesses cannot but benefit from this.
Question: why is it then, with all parts of the business legally consolidated, there is nothing a bankrupt-to-be can do once the torpedo of crisis suddenly cuts through the side of his business ship?
