sou · GNB31 · 2000-01-01 00:00:00 — The ceiling for the wage guarantee is increased from to four times the statutory base amount (currently approximately , 000). The maximum period for the wage guarantee is extended to eight months. Despite the fact that in the terms of reference, the Government only envis- aged marginal changes in the rules concerning business mortgage, this was discussed freely by the Committee. As mentioned above, business mortgages is a floating charge and pro- vides security in the debtors assets subject to certain exceptions. Liquid funds, assets which can be pledged through registration, and financial in- struments are not included. The security is created through registration which a one-time fee of of the registration amount, followed by the surrender of a business mortgage certificate to the lender. The justification for the existence of business mortgage is that the secu- rity is assumed to increase, and render access to credit cheaper. It is diffi- cult to determine to what extent the business mortgage actually has this effect. Statistics have been compiled in order to illustrate the extent to which business mortgages are taken out. It is apparent from these statistics that business mortgage are unusual for the smallest companies and newly-started companies and for service companies, while they are quite prevalent with smaller and mid-sized companies with an emphasis on manufacturing and trade, and are thereafter of less significance to large companies. It has not been possible to determine to what extent the business mortgage certificates actually are pledged as security. There is no appreciable difference related to the different sizes of municipalities. Pursuant to Chapter 2, section 13 of the Banking Operations Act (SFS 1987:617), banks may lend money only where the borrower is believed to possess the ability to repay the loan. In addition, sufficient security must be provided unless special cause exists. interviewed bank rep- resentatives in , , and . The Swedish bank representatives stated that the business mortgage, de- spite the fact that the underlying property has a limited borrowing value, is of significance in conjunction with borrowing by some companies. It can be noted in this context that claims secured by business mortgage receive an average dividend of approximately in bankruptcies. It has been claimed that the abolition of business mortgages would result in certain loans no longer being available and other types of security would be de- manded to a greater extent. In , there are no floating charges. Suppliers have greater possi- bilities than in to obtain an exclusion of stock in trade from the assets of the estate in bankruptcy, which may be resold prior to payment through what is known as a credit consignment. The Danish Finance Coun- cil (which corresponds to the ) has recently requested legislation creating floating charges in as well. In its petition to the Government, it was emphasised that the purpose is to obtain access to simple and inexpensive security, while it cannot be expected that the volume of credit will increase or that interest rates will be lowered. From our interviews, it was also apparent that the debtors were somewhat opposed providing other security which would decrease their ability to deal with their assets (creation of a charge over stock in trade) or which might give the debtor a bad reputation (factoring). In , a business can grant a floating charge by way of a business mortgage over of its property. This percentage was selected in con- junction with the abolition of certain superior rights of priority (for wage and tax claims). Depending on the focus of the banks, they stated in our interview that the business mortgage was good supplemental security or, respectively, that the total abolition thereof would not make any difference. No complaints were relayed regarding the impossibility to use all of a debt- ors property as the basis for a floating charge. In , there is an equivalent to the Swedish business mortgage through three different registered charges, namely over personal property, stock in trade, and book debts (factoring charges). In 1993, a committee proposed (NOU 1993:16) that the registered charge over stock in trade and book debts be abolished; the borrowing value was deemed to be too low (). Instead, it was believed that the banks were combing enterprises for security which did not have any major significance for the decision to extend credit. The proposal will probably not lead to any amendment to the legislation (compare Ot Government no. 26 1998-99). has further noted that there is no corresponding instru- ment to the floating charge in many countries and that the banks in such countries must, in addition, accept that, in conjunction with a bankruptcy, stock in trade and receivables primarily go to suppliers according to the rules governing retention of title which are more generous than in . Thus, in suppliers often have a better right than the banks to stock in trade and outstanding accounts receivable which arose in conjunction with sales of the goods through expanded retention of title , while the banks have better rights than creditors without priority due to the fact that the banks obtain security with secondary priority in the debtorscurrent and future stock in trade and accounts receivable, without the debtor being de- prived of the ability to deal with his property, and without the security being made public. In reality, this results in the banks acquiring the superior rights in a fraction of the value of what in constitutes the basis for the business mortgage. has obtained legal-economic studies from (, ), () and (the , , Fin- land) and (, ). has also studied other legal-economic literature, inter alia, regarding considera- tion of amendments to the U.S. insolvency legislation (Uniform Commercial Code, article 9, see no. 6 of 82, 1997). In the Committees evaluation of the business mortgage, the Committee has assumed that the business mortgage does possess certain significance in lending. When the risks are deemed to be too great, they cannot be compen- sated with interest where the business only has a normal level of profitabil- ity. However, lending to businesses in is the most profitable in- vestment for Swedish banks, and somewhere the deposits must receive in- terest. A transition to other forms of security is not simple, since fixed as- sets are already financed through instalment payment purchases and leasing, and since a charge over stock in trade and accounts receivable requires that the business give up its ability to deal with the assets (compare the Danish views). Considering the prevailing foreign conditions, the Committee as- sumed that a limitation on the underlying property in a business mortgage would not materially diminish the availability of credit to enterprises. In addition, it has been assumed that a limitation would lead to loans increas- ingly being directed to businesses with the best profitability , rather than to those which can offer the best security. has also asked the question whether it is reasonable that the strongest lenders, i.e. those which, through alternative investment possi- bilities, possess the best negotiating position, are to be given the possibility to always mortgage almost all of the debtors assets, whether the security was necessary for the loan or not. The tax creditor (the State) and tort creditors can not negotiate regarding credit, albeit the State has, to a certain extent, assumed personal payment liability. Employees must, to a great ex- tent, accept the work which is offered (otherwise they cannot receive unem- ployment benefits) and they cannot periodically ration their labour in order to work even more later on. In addition, the provision of credit which takes place from suppliers of goods with limited marketability is often only ap- parently voluntary, if the supplier is to be rid of the goods in time. In order to prevent this transfer of the credit risk to persons who involuntarily pro- vide their credit or, in any event, occupy an inferior negotiating position, one could consider providing the State and employees with rights of priority superior to floating charges and introducing more generous regulations re- garding retention of title. Thus, the current situation is not a given one. However, the Committee believes that the right of priority regulations should be streamlined rather than being made more complicated. The intro- duction of retention of title provisions which are valid in rem with respect to goods which the purchaser has a right of disposition prior to payment to the seller would result in a situation where neither the party with the floating charge nor the seller would be able to rely on the fact that the stock in trade is available for recourse as security in the event of an bankruptcy. When a company becomes insolvent, the business mortgage has largely negative effects. The existence of security may result in the secured party not taking ac- tion before the security is threatened, and by then the company is often in such bad shape that a successful reorganisation is impossible. Even if cer- tain reorganisation a positive current value (the chance that they will become profitable exceeds the risk of loss), security holders tend to oppose such proposals since, in the event of success, they can only obtain a limited portion of the profits (the difference between the current value of the security and the claim) while, in the event of poor results, he can lose even more (the entire value of the security). If the security only applies to certain types of assets, the picture becomes even more complicated. The best situa- tion would be if all creditors were in the same boat when a reorganisation is discussed. Series bankruptcies, which are based on the owner of a limited liability company being able to purchase the companys assets after having rolled the loan over to a new company so that his guarantee need not be utilised, presuppose that the party which provided the loan to the company in bank- ruptcy receives the entire purchase price (corresponding to the loan) as a dividend in the bankruptcy by means of a business mortgage. This phe- nomenon, which in various contexts has troubled the legislature, would cease to exist if the business mortgage were abolished or significantly re- stricted. The above-stated considerations have resulted in some members of the Committee wishing to abolish the business mortgage entirely, while others have expressed doubt regarding a limitation on the business mortgage, cit- ing the provision of credit to smaller and medium-sized companies, most of which never become insolvent nor the subject of reorganisation proceedings. However, the Committee has also taken into consideration the fact that a restriction on the underlying property of a business mortgage is necessary if the right of priority of tax claims is also to be abolished, as well as the right of priority of wage claims for wages following notice of dismissal, at the same time as the wage protection for employees is improved and the pre- scribed savings are carried out in the State budget. Certain persons have conditioned their continued acceptance of the current rules regarding reten- tion of title provisions, which are disadvantageous to suppliers, on a limita- tion of the business mortgage. In conclusion, the Committee has united on a proposal that the business mortgage, as in , may only encumber of the debtors property2. 2 One member (, ) believes (together with the 's expert ) that the percentage should be between 50 and . The four Social Democrat members expressed their con- cern that lending to small businesses in sparsely-populated areas will decrease through the reduction of the property underlying the business mortgage, however they accept the proposal. Of the experts, attorneys and state that the right of priority for wage claims should be entirely abolished, since it primarily finances the wage guarantee, the costs of which should be apportioned according to other principles, via the State budget or in- surance. Professor of Economics questions the compulsory limi- tation on property underlying the business mortgage which he believes will lead to a redirecting of the credit flow to the disadvantage of new companies, and he proposes that each business should itself be allowed to determine its order of rights of priority: thereby, the business would be able to use its security in the most effective . , , and from various business community organisations express their regret concerning the limitations of the terms of reference especially the savings requirement. They believe that smaller and mid-sized companies will have more difficulty obtaining access to credit but believe that the proposals are well consid- ered within the framework of the terms of reference. (the Swedish Trade Union Confederation) and (the sional Employees) do not believe that large unpaid wage claims can be an obsta- As a consequence of the above, the Committee presents certain proposals designed to strengthen the remaining business mortgage so that the actual change does not result in a halving of the borrowing value. The idea is that, within the framework of , the business mortgage will be as reliable a form of security as possible. In this context, the most important proposal is to reconstitute the business mortgage into a general right of priority in all of the property of the busi- ness. It will thereby not matter whether the accounts receivable of the busi- ness are converted into liquid funds immediately prior to a bankruptcy. Upon a recalculation of the dividend in all bankruptcies as they appear to- day, this would only result in a marginal improvement () while the reliability should be significantly more valuable in conjunction with the ex- tension of credit. In addition, the abolition of the right of priority for rent claims is designed to strengthen the remaining business mortgage. Today a business mortgage creditor can expect, on average, a dividend of . As a result of proposed reform he may expect to receive 22,plus increases related to the extended basis of the business mortgage, the abol- ishment of priority for rent claims, and the improved dividends to unsecured creditors, altogether approximately . Furthermore, he needs not to worry about a risk that significant stock in trade or receivalles in his spe- cific case will fall outside the security because they were converted to liquid funds immediately prior to insolvency proceedings. It is proposed that the new regulations regarding business mortgage enter into force following a transition period of 1.5 years during which holders of business mortgage will have the possibility of terminating the credit and, where necessary, carrying out an bankruptcy according to the current rules. cle to reorganisation and oppose the emphasis on the competition-distorting ef- fects of the wage guarantee. They do not wish the wage guarantee to be used in business reorganisations outside bankruptcy and do not accept that wages from the wage guarantee during the business reorganisation may be deducted if the reorganisation is converted into an bankruptcy. They wish to retain the link be- tween the right of priority and wage guarantee. They believe that the proposals do not provide sufficient levels of wage protection, either with regard to times, ceil- ings, saved holidays, etc. In addition, they believe that the liability of the estate in bankruptcy for wages when certain employees are used during the period follow- ing notice of dismissal should result in the re-employment priority regulations in the Employment Protection Act being applicable. They propose that wages ear- ned prior to the bankruptcy and two monthswages following notice of dismissal should be subject to the wage guarantee, even if the employee works for the estate during the period following notice of dismissal and, in addition, these wage claims should have priority over business mortgage. However, the restriction on the business mortgage to of the current basis is accepted. Among the Committees other proposals, it may be noted that fines, condi- tional fines, and claims as a consequence of forfeiture, or other legal effects due to crimes shall once again be subordinated by law. Ongoing agreements, etc. has been charged with considering the implementation of regulations according to which a debtor in a business reorganisation will be able to prematurely terminate onerous, long-term agreements. The purpose is, naturally, to facilitate a business reorganisation. This task raises the question of whether it is reasonable that creditors who have entered into advantageous, long-term agreements are to contribute to a reorganisation to a greater extent than other creditors who have entered into advantageous agreements, but who can file a claim for their entire loss upon breach. believes that, in this context, it is also appropriate to con- sider the right which a debtor possesses pursuant to Chapter 2, section 20 of the Business to demand future performance without having to pay for performance received prior to the commencement of the reorganisation proceedings. If this rule is retained, the question arises as to whether the rule should not also be applicable in conjunction with bankrupt- cies. A closely related question is whether a creditor should be permitted to set off a claim due to him which is based on performance which was made prior to the commencement of the insolvency proceedings and which is, therefore, without a right of priority against a claim for payment which is based on performance which the debtor in reorganisation or the estate in bankruptcy made during the insolvency proceedings (such a right of set off is currently deemed to exist regardless of whether the claims arose out of the same contractual relationship; NJA 1916, p. 154 and 1996, p. will deal with these issues in a final report which it is anticipated will be published in . Finns det särskilda skäl att anta att borgenärens rätt allvarligt äventyras, får dock rätten besluta att försätta gäldenären i konkurs. Innan ett sådant beslut meddelas skall rekonstruktören beredas till- fälle att yttra sig.Rätten skall besluta att försätta gäldenären i konkurs om gäldenä- ren inte fullgör sina förpliktelser enligt 20 b § lönegarantilagen (1992:497). Lag om ändring i konkurslagen (1987:672) Härigenom föreskrivs i fråga om konkurslagen (1987:672) att 2 kap. 10 a §, 4 kap. 1 § samt 12 kap. 11 och 21 §§ skall ha följande lydelse. Om företagsrekonstruktion pågår enligt lagen (1996:764) om företagsre- konstruktion, skall en borgenärs ansökan om konkurs, ifall gäldenären be- gär det, förklaras vilande i avvaktan på att företagsrekonstruktionen upp- hör. Finns det särskilda skäl att befara att gäldenären vidtar eller un- derlåter att vidta en viss åtgärd och därigenom sätter borgenärens rätt i fara, får dock rätten besluta att försätta gäldenären i konkurs. Innan ett sådant beslut meddelas skall rekonstruktören beredas till- fälle att yttra sig. Återvinning till konkursbo får på begäran av boet ske i enlighet med Återvinning till konkursbo får på begäran av boet ske i enlighet med vad som anges i detta kapitel. Återvinning får dock inte ske av 1.betalning av skatt eller avgift som avses i lagen (1971:1072) om förmånsberättigade skatteford- ringar m.m., om fordringen var förfallen till betalning, 2.betalning av eller förmånsrätt för underhållsbidrag enligt äkten- skaps- eller , om bi- dragsbeloppet var förfallet till be- talning och den underhållsberätti- gade inte har gynnats på ett otill- börligt sätt. vad som anges i detta kapitel. Återvinning får dock inte ske av betalning av eller förmånsrätt för underhållsbidrag enligt äkten- skaps- eller , om bi- dragsbeloppet var förfallet till be- talning och den underhållsberätti- gade inte har gynnats på ett otill- börligt sätt. Vid omröstning i ackordsfrågan får rösträtt utövas endast för bevakade fordringar. En borgenär som kan få täckning för sin fordran genom kvittning eller vars fordran är för- enad med förmånsrätt deltar dock inte i omröstningen. En borgenär, som enligt fordringsavtalet har rätt till betalning först efter övriga borgenärer, deltar inte heller i om- röstningen, såvida inte de övriga borgenärerna medger det. Om en borgenär helt eller delvis avstår från kvittningsrätt eller för- månsrätt, deltar han i motsvarande mån. Kan en borgenärs fordran endast till viss del täckas genom kvittning eller understiger värdet av den egendom i vilken borgenä- ren har särskild förmånsrätt hans fordran, deltar han med återstående del av fordringen. Vid omröstning i ackordsfrågan får rösträtt utövas endast för bevakade fordringar. En borgenär som kan få täckning för sin fordran genom kvittning eller vars fordran är för- enad med förmånsrätt deltar dock inte i omröstningen. En borgenär, som har rätt till betalning först ef- ter övriga borgenärer, deltar inte heller i omröstningen, såvida inte de övriga borgenärerna medger det. Om en borgenär helt eller delvis avstår från kvittningsrätt eller för- månsrätt, deltar han i motsvarande mån. Kan en borgenärs fordran endast till viss del täckas genom kvittning eller understiger värdet av den egendom i vilken borgenä- ren har särskild förmånsrätt eller förmånsrätt på grund av företags- inteckning hans fordran, deltar han med återstående del av fordringen. En svarande som med anledning av en återvinningstalan har fått eller kan få en fordran mot gäldenären, får utan bevakning delta med fordringen i omröstningen. Innebär ackordsförslaget att borgenärer som inte har förmånsrätt skall få full betalning intill visst belopp, får rösträtt inte utövas för de fordringar som därigenom får full betalning. Med borgenärer som har förmånsrätt likställs en borgenär som till säker- het för sin fordran har gjort förbehåll om återtaganderätt. Ett fastställt ackord är bindande för alla borgenärer, kända och okända, som har haft rätt att efter bevakning rösta om ackordsförslaget. En borgenär, som enligt ford- En borgenär, som har rätt till be- ringsavtalet har rätt till betalning talning först efter övriga borgenä- först efter övriga borgenärer, förlo- rer, förlorar sin rätt till betalning rar sin rätt till betalning av gälde- av gäldenären, om inte alla borge- nären, om inte alla borgenärer som närer som enligt 11 § hade rätt att enligt 11 § hade rätt att rösta om rösta om ackordsförslaget tillgodo- ackordsförslaget tillgodoses fullt ut ses fullt ut genom ackordet. Den som har förmånsrätt i viss Den som har förmånsrätt i viss egendom är bunden av ackordet i fråga om belopp som inte kan tas ut ur egendomen. bunden av ackordet i fråga om be- lopp som inte kan tas ut ur egen- dom som omfattas av förmåns- rätten. En borgenär har, utan hinder av ackordet, den rätt till kvittning som han kan ha enligt 5 kap. 15 och 16 §§. 1.Denna lag träder i kraft . 2.Äldre föreskrifter om återvinning och ackord gäller fortfarande i fråga om en konkurs, i vilken konkursbeslutet har meddelats före ikraftträdan- det. Lag om ändring i förmånsrättslagen (1970:979) Härigenom föreskrivs i fråga om förmånsrättslagen (1970:979) dels att 5 och 11 §§ skall upphöra att gälla, dels att 9, 12, 13 och 15 §§ skall ha följande lydelse, dels att nya 11 § skall ha följande lydelse, dels att det i lagen skall införas två nya paragrafer, 12 a och 19 §§, av följande lydelse. Särskilda förmånsrätter gäller inbördes efter paragrafernas följd och efter den i 4- 7 §§ angivna numreringen. Förmånsrätt enligt 4 § 3 har dock företräde framför förmånsrätt enligt 4 § 2 på grund av annan retentionsrätt än som avses i 3 kap. 39 § sjölagen (1994:1009).