[Direct answer]In the Beijing area, the right to revoke bankruptcy refers to the right of the administrator to request the court to revoke acts that harm the interests of creditors and are performed by the debtor within a certain period before the acceptance of the bankruptcy application. According to Article 31 of the "Enterprise Bankruptcy Law of the People's Republic of China" (effective June 1, 2007), within one year before the people's court accepts the bankruptcy application, the administrator has the right to request the revocation of the following acts involving the debtor's property: transferring property without compensation; conducting transactions at obviously unreasonable prices; providing property guarantees for unsecured debts; making advance repayments on debts that have not yet matured; and waiving claims. Article 32 stipulates that if the debtor, who meets the bankruptcy conditions, still makes payments to individual creditors within six months before the acceptance of the bankruptcy application, the administrator has the right to request the revocation, except for those individual payments that benefit the debtor's property. The administrator shall provide evidence regarding the time of the acts, the consideration, and the harmful consequences. For similar issues, please refer to the relevant provisions.Business and contract disputes in enterprisesColumn.

1. Problem background and typical scenarios

Such disputes are common in several situations: First, the debtor transfers its core assets to a related party free of charge or at a very low price within one year before bankruptcy, and the creditor questions the transfer of benefits; Second, the debtor supplements or adds new property guarantees for specific creditors, resulting in unfair repayment; Third, the debtor prematurely repays individual mature or non-mature debts within the critical period; Fourth, the debtor waives foreign claims or discharges debts, reducing the distributable assets; Fifth, the debtor repays individual creditors within six months before bankruptcy even though it already meets the bankruptcy criteria. When handling such cases in Beijing, we usually first identify the time of the actions and the debtor's asset-liability situation, then determine whether they fall within the scope of revocability, and, if necessary, combine this with other relevant factors.Creditor's rights and debts, and enforcement casesThe column comprehensively introduces the rules regarding the realization of creditor's rights.

II. Key points of contention

First, whether the act occurred within the statutory time limit. The starting point of one year or six months is calculated from the date the court accepts the bankruptcy application. Second, whether the transaction consideration is obviously unreasonable, which needs to be judged in light of the market price and the transaction background. Third, whether the individual settlement benefits the debtor's property, and the benefits will not be revoked. Fourth, whether the new guarantee harms the fair compensation of other creditors. Fifth, the extent of the loss of the property pool caused by the gratuitous act and the waiver of the creditor's rights. Sixth, the scope of the property to be returned after revocation and the scope of the property to be incorporated into the debtor's property. Seventh, the protection of bona fide counterparties and the boundaries of the exercise of the right of revocation. The specific determination shall be based on the currently effective laws, regulations and judicial rulings. For related contract disputes, please refer to the relevant provisions.Business and contract disputes in enterprisesColumn.

III. Professional analysis by Henglue Law Firm

From the practical experience of the lawyers handled by our firm, the key to winning or losing bankruptcy revocation cases lies in the timeline and the evidence of consideration. When lawyers act as managers, they usually first retrieve the time of acceptance of the debtor's bankruptcy application and the audit report on assets and liabilities to define the critical period; then review the contracts, payment vouchers, appraisal reports and related transaction relationships of the suspicious transactions one by one to prove that the consideration is obviously unreasonable or that the guarantee has caused new damage to fairness. For individual settlements, it is necessary to prove that the debtor already had the reasons for bankruptcy at the time of settlement and did not benefit from the property. The counterparties often defend themselves with good faith and reasonable consideration, so lawyers need to counterattack with market comparisons and capital flow analysis. The lawyers handled by our firm pay attention to restoring the changes in property through accounting materials and bank transaction records to increase the success rate of revocation. For debt collection, it can be referred to together.Creditor's rights and debts, and enforcement casesColumn.

IV. Practical suggestions and legal basis

Action proposal: Firstly, the manager should review the transactions within the critical period in a timely manner from the date of acceptance of the bankruptcy. The relevant processes can be referred to for reference.Special services and other casesFirst, identify the legal provisions relevant to the case. Second, collect transaction contracts, payment receipts, appraisal reports, and audit reports to prove the timing of the transactions and the imbalance of consideration. Third, distinguish between one-year and six-month transactions and apply different grounds for revocation. Fourth, claim that after revocation, the counterparty should return the property and incorporate it into the debtor's assets. Fifth, cautiously assess the feasibility of revocation when the counterparty has acted in good faith and received reasonable consideration. Regarding legal basis, Article 31 of the Enterprise Bankruptcy Law of the People's Republic of China lists five types of revocable acts within one year prior to acceptance, which came into effect on June 1, 2007; Article 32 stipulates the revocation and exceptions of individual settlements within six months prior to acceptance; Article 33 defines invalid acts; and Article 34 provides for the recovery of property from revoked or invalid acts.

5. Henglu Law Firm's Advice

Risk Warning: First, the right of revocation is strictly limited by the statute of limitations. Actions taken beyond the statutory time limit or exceeding the legal time limit are difficult to revoke. Second, the determination of an obviously unreasonable price requires objective evaluation, and it is not easy to establish a subjectively low price. Third, if individual settlements benefit the debtor's property, they will not be revoked, and the debtor needs to provide evidence of the benefiting fact. Fourth, after revocation, the property should be included in the debtor's property for unified distribution, and individual creditors cannot be directly compensated. Fifth, transactions involving bona fide counterparties and reasonable consideration are protected. It is recommended that the administrator intervene in the review as soon as possible and, if necessary, entrust professional lawyers to fix the evidence. For related corporate matters, you can consult professional lawyers for overall planning.

VI. Frequently Asked Questions

Q1: Which actions can be revoked in bankruptcy proceedings?

According to Article 31 of the Enterprise Bankruptcy Law, within one year prior to the acceptance of the bankruptcy application, if the debtor transfers property without compensation, conducts transactions at obviously unreasonable prices, provides property guarantees for unsecured debts, prepays non-due debts, or waives creditor's rights, the administrator may request the rescission of such acts; according to Article 32, if the debtor still repays debts individually within six months prior to the acceptance of the bankruptcy application despite meeting the bankruptcy grounds, such acts may also be rescinded, except for those that benefit the debtor's property. The key lies in the timing of the acts and whether they harm the creditor's fair compensation.

Q2: What evidence do I need to collect to exercise the right of bankruptcy revocation?

The following should be collected: the court's ruling on accepting the bankruptcy application, which determines the starting date of the critical period; the debtor's audit report and balance sheet, which prove the debtor's asset and liability status; contracts, payment vouchers, and bank statements related to suspicious transactions, which prove that the consideration is unreasonable; proof of the debtor's related-party relationships; and information on the beneficiaries of individual settlements and records of property changes. The evidence is used to prove that the actions took place within the critical period and caused harm to the creditors' interests.

Q3: How much do the fees for bankruptcy revocation disputes cost?

The expenses mainly include the manager's costs and possible litigation fees. If the right of revocation is exercised through litigation, the litigation fees will be charged in stages according to the amount of the property requested to be returned, and the debtor's property will be repaid at any time; the attorney's fees will be negotiated according to the complexity of the case and the amount of the subject matter, and will be paid from the debtor's property or agreed upon separately. The specific amount will be evaluated based on the amount involved in the revoked act and the difficulty of providing evidence. It is recommended to first assess the scale of the property loss and then decide on the solution.

Q4: Within what timeframe must the right to revoke bankruptcy be exercised?

The right of revocation should be exercised in the bankruptcy proceedings, and the administrator usually claims it in a timely manner from the acceptance of the bankruptcy to the distribution of the property; the critical period is the time limit of the act, not the exercise period, but the delay may affect the recovery and distribution of the property. If it is exercised by litigation, the statute of limitations and procedural deadlines of civil litigation shall apply, and the first-instance ordinary procedure generally does not exceed six months. The key is to immediately review suspicious transactions after the acceptance of the bankruptcy to avoid the transfer or consumption of the property.

Q5: How should we handle a discoverable revocable act?

The first step is for the administrator to define the critical period transactions based on the acceptance ruling and financial information; the second step is to sort out the contracts and the flow of funds, and initially determine whether they meet the grounds for revocation; the third step is to promptly file a lawsuit or claim the return from the counterparty if they meet the requirements; and the fourth step is to include the recovered property in the debtor's property for unified distribution. For reference only.Beijing Henglu Law FirmFor similar cases on the official website, it is advisable to engage a professional lawyer to review them as soon as possible to increase the success rate of revocation and recovery of funds.

This article is written based on the common judicial interpretations in the Beijing area. If the case occurs in other regions, it is recommended to consult local lawyers to verify the regional differences.

If you are currently facing similar problems, it is recommended that you consult a professional lawyer as soon as possible with the relevant evidence materials to avoid missing the statutory time limit. →Business and commercial legal services·Beijing Henglu Law Firm

Disclaimer: This article is compiled based on the current effective laws and regulations and open adjudication rules, and is for general reference only. It does not constitute a formal legal opinion on specific cases. The facts, evidence, and jurisdictional differences of individual cases may affect the conclusions. If you encounter disputes, please consult a practicing lawyer in time.