FIGHTING RECESSION AT THE EXPENSE OF ACCESS TO JUSTICE - THE CASE OF CROATIAN FINANCIAL OPERATIONS AND PRE-BANKRUPTCY SETTLEMENTS ACT

Abstract

It is hard to remember when the last time was that one legal document raised as much controversy among legal and economic experts, entrepreneurs and wider public as it is the case with the Act on Financial Operations and Pre-Bankruptcy Settlements (AFOPS). As stated by the Croatian Government at the time of its delivery, the primary aim of the pre-bankruptcy (or insolvency) settlement proceedings was to help troubled companies to revitalize their businesses, keep jobs and to help creditors to recover their claims in a larger proportion than it would be possible if standard bankruptcy proceedings were applied to troubled companies. The fact that two different organs, one professional and one juridical have been conducting pre-bankruptcy settlement proceedings in different stages gives rise to different questions in relation to the right to a fair trial and access to courts as guaranteed by the European Convention for Protection of Human Rights and its related case law. In particular, we shall discuss whether PBS committees constituted “tribunals” in the Conventional context and whether European Convention allows the prior intervention of professional bodies in disputes over civil rights and obligations. Last, but not least, we need to check the powers and the role of commercial courts in confi rming the settlement agreements, bearing in mind that only if the access to a court with full jurisdiction is ensured, the lawfulness of the procedure is provided and secured.

Keywords

• Act on Financial Operations and Pre-bankruptcy settlement
• European Convention on Human Rights
• full jurisdiction
• the right to a fair trial and access to courts