RUTHY CHAN
FREE Bankruptcy/Winding-up Consultation 

What is bankruptcy?

It is a legal procedure in which a debtor is declared unable to pay his debts and a chain of subsequent repayments is made to creditors.。

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Who can petition for bankruptcy?

If you think you are unable to repay your debts and are insolvent, you can apply for bankruptcy. However, if you own assets, such as property, or have sufficient cash flow, you need to consider whether bankruptcy is appropriate. In this case, you may also consider an individual voluntary repayment arrangement.

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Alternatives to Bankruptcy?

- Individual Voluntary Arrangement (IVA)

- Debt Relief Plan (DRP / IDRP)

(Our company will also provide corresponding services)

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Is filing for bankruptcy guaranteed to go smoothly?

It may not be, if the amount of assets you have makes the court believe that you are able to repay, or if there is an error or fault in the assessment of the value of your assets, or if a third party files an objection to bankruptcy, the court has the right not to issue a bankruptcy order ("BO")

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Documents required for debtor bankruptcy?

Debtor's Bankruptcy Petition

Form 28C (Statement of Affairs)

Preliminary Examination for Bankrupt

Monthly Income and Expenses Assessment Form

Annual Statement of Earnings and Properties Acquired

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Bankruptcy fee:

Administration fee for Official Receiver's Office (One-off) --> HK$8,000

Filing fee for High Court (One-off) --> HK$1,045

Consultation fee (Optional) --> HK$4,000

      [Total: HK$9,045 - HK$13,045]

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What are the advantages and disadvantages of bankruptcy?

1. After filing for bankruptcy, creditors must stop debt collection, including debt lawsuits and civil litigation.

2. Once the assets are taken over by the trustee-in-bankruptcy, there is no need to arrange debt repayments on your own.

3. Once the BO is released, all debts owed before bankruptcy will be wiped off.

4. You cannot apply for new loan while you are bankrupt.。

5. During bankruptcy, try not to take taxis, engage in extravagant behavior (there is a chance of being complained about by creditors), buy valuables, purchase assets, or make insurance contributions.

6. The consequences of bankruptcy are that the parties cannot engage in specific professions, such as lawyers, insurance practitioner, real estate practitioner, securities dealers, and directors of limited companies.

7. It is easy to break the law without knowledge.

8. After the BO is released, your credit rating may be affected.

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How to petition for bankruptcy?

1. Fill out the "Debtor's Bankruptcy Petition" and "Statement of Affairs".

2. Bring along with the completed documents to the Receiver's Office on 10/F High Block, pay the administrative fee and then take the oath.

3. On the same day, take the sworn documents to LG1 of the High Court to file and have them sealed, pay the fee and get the hearing date of granting BO.

4. Attend the High Court hearing on the hearing day and obtain the BO.

5. Complete the "Preliminary Examination for Bankrupt" and the "Monthly Income and Expenses Assessment Form".

6. Submit all completed forms, copies of court-sealed documents, and information related to assets, liabilities, income and expenditures to the provisional trustee or Official Receiver's Office ("ORO") for an initial meeting and handover.

7. The Official Receiver may arrange another meeting for assets or accounting books transfer to ORO / provisional trustee (CPA firm / lawyer firm) after a period.

8. In addition, when the bankruptcy order is granted, all your bank accounts will get frozen immediately. You need to make an appointment on the "Hong Kong Government Portal" to apply for an authorization letter to open / retain a bankruptcy savings account, and then go to the bank for account opening / retaining existing account (you can only retain one saving account for receiving salary).

9. If your assets exceed HK$200,000, the provisional trustee will hold a creditors' meeting to appoint new trustee for management of the bankruptcy case.

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What are the responsibilities during the 4-year bankruptcy period?

1. Starting from the date of bankruptcy every year, you need to complete "Annual Statement of Earnings and Properties Acquired" ("A/S"). If the bankruptcy lasts for 4 years, you need to file out 4 copies, one for each year.

2. Whenever you notice any change in assets / any increase in cash flow (greater than HK$50), you must notify ORO / trustee immediately, otherwise you may violate the law.

3. Keep in contact with trustees and update them with the personal information.

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What is the procedure for releasing bankruptcy order?

1. Generally, a bankrupt will be automatically discharged after 4 years.

2. At the same time, bankrupt can obtain the "Letter Confirming No Objection to Issuance of the Certificate by the High Court" from the trustee.

3. Submit the application for "Certificate of Discharge" together with the "No-objection Letter" to the Registry on the 1/F of the High Court.

4. Once you get the "Certificate of Discharge" from High Court, you may apply for new loans, mortgages, credit cards, etc. from the financial institutions in the future.

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Will a bankrupt person violate the law?

Yes, to avoid violating the Bankruptcy Ordinances, you must comply with the following:~

1. File A/S each year within one month after the BO date and submit it to the trustee.

2. Do not deliberately omit the information to the trustee, especially when you get additional assets / cash inflow.

3. Submit all documents and assets required for bankruptcy on time and hand over to the trustee.

4. Any increase in assets or cash flow (greater than HK$50), must be reported to the trustee immediately.

5. You are not allowed to borrow more than HK$100 from any person / financial institutions.

6. Prepare and keep full sets of accounting books and relevant documents (for businessmen).

7. Cannot serve as company director.