The “helping” hand for people in debt

=== **Preventive**
measures **===**
Preventive measures are about trying
to prevent the situation of over-indebtedness. It is very important that these
measures are taking in different domains of society. Yet this is very difficult
to accomplish, the goods, cooperation and the knowledge are not always present
or accessible.

To gain knowledge, the Flemish Debt
Centre tries to invest in scientific research about over-indebtedness. They own
some figures, but a more profound research could be a big help in supporting
their preventive actions.

Secondly, prevention on structural
level. This centre is occupied with improving the legal framework for client
protection. It is proven that abuse is not something exceptional anymore. The
Centre aims at a better control of the legislation which protects clients. They
also want the minimum wage and alimony to adjust to the ageing of the
population. Yet the goal is to achieve a prevention over several domains, the
centre wants the education system to show the risks of over-indebtedness and of
making debts. This requires a lot of skills. The younger generations need to
know something about our consumption-oriented society.

The next goal is to achieve quality
aid. Victims of over-indebtedness often have a stressful and psychological hard
living condition. It is important that the context of the over-indebtedness
changes as well. People need help to change their living conditions, to handle
the problem. But the social workers often have no time, because of the many
cases, to interfere in the daily life of the debtors. So more goods are needed
to provide a quality aid for every person in need, which also means that the
social workers need permanent education on how to provide good aid for every
case. Because the amount and the complexity of the cases increase prominently.

The fourth aim is to have constant
learning social workers and conciliators. It is important that different
categories of the population have a specific treatment to help them as much as
possible. For every category, they have specific actions and measures to be
taken (Vlaams Centrum Schuldenlast,2011).

=== **Existing**
legislation – enterprises **===**
As there is no such legislation for
individuals there are Belgian measures against over-indebtedness, called ‘the
law continuity of enterprises’. The law provides two options in order to avoid
bankruptcy. The first option is an agreement between the indebted company and
one or more of its creditors. There are no rules about what has to be written in
the agreement, this is completely up to the creditors and the company. This
measure proves to be not the best solution, as the creditors have the
possibility of refusing the agreement.

The second option is the judicial
reorganisation. A merchant has to request this in the court. From the moment he
handed in his request for judicial reorganisation, he is automatically
protected against bankruptcy and seizure. The judicial reorganisation gives
three possible options. The first one is an agreement similar to the one
already explained above, but then with a repayment period imposed by the judge.
The second option is a collective agreement. In this measure a debtor is
obliged to submit a repayment plan to the judge. In this plan one has to tell
how he will repay his debts in a maximum period of five years. When the
majority of the creditors agrees to this plan, it enters into force. The third
option is a transfer to judicial authorization. In this option a judicially
authorized agent will reorganize your business. One can ask voluntarily for
this measure or can be imposed by the judge.

The effectiveness of this law is
questioned, because a lot of businesses (about 70% of them) go bankrupt even
after using this measure.

Indebted companies, that cannot pay
their bills, go bankrupt. A merchant can ask for bankruptcy himself or this can
be imposed by the creditors or the public prosecutor. After the application for
bankruptcy, the judge will appoint a liquidator. He makes a list of all the
debts and the goods and property of the bankrupt company. Then all the
belongings of the company and some of the belongings of the merchant are sold.
The remaining debts are paid by the former owner of the company, but sometimes
the judge can acquit the debtor.