NEWSLETTER

ON ENTERPRISE RESTRUCTURING

#12 October 2001

Dear readers:

The last month was full of events that influence the processes of restructuring in Ukraine. In the end of September there was an event that was looked forward and prepared to by arbitration managers during the year. A charter congress of Ukraine’s nationwide self-regulated organization "The Union of Crisis Managers of Ukraine" has taken place. We are happy to welcome the President of this organization, Mr. Mikhailidi, and wish him a success in his uneasy work. The materials about the congress are placed at the 3-rd page of our bulletin.

Between 11 and 12 of October the Financial Restructuring Project has held the International Conference "Restoring Solvency in Transitional Economies through Bankruptcy Proceedings". The Conference has invited well-known experts in the field of commercial law, economists, judges, representatives of public authorities and arbitration managers. The Conference was devoted to problems of restructuring, solvency restoration and bankruptcy in countries with economies in transition, as well as to issues of efficiency of bankruptcy procedures in various systems of legislation. The main objective of the Conference was to exchange international experiences in the above mentioned domain, and to develop basic recommendations for functioning of an efficient legislative system to regulate bankruptcy. A more detailed discussion of the conference can be found in our head "International Experience of Restructuring".

Under the "Judgements of Experts" head, we offer for your attention a large article by Anatoliy Zhukov who is already familiar to you from previous publications. This article concentrates on disclosure of rights of creditors in a procedure of bankruptcy of a debtor in case a security agreement was signed. We believe that this material will be of interest and benefit for both creditors and practicing lawyers as well as for arbitration manages and restructuring specialists.

Our new Eastern Training Center located in Donetsk has commenced its active operation. The first results and perspectives of this activity will be discussed by the Director of this Center Lilia Diachenko.

Olga Makara,

News&Media Coordinator

OUR ANNOUNCEMENT

 The Kiev-based Training and Consulting Center for Restructuring of Enterprises which is supported by the Project is planning to hold on information seminar on "The Law of Ukraine "On Restoration of Solvency of the Debtor or Declaring It Bankrupt"" for enterprises of the city of Kiev and Kiev oblast. The seminar will take place in premises of the branch of "Kiev-based Auctions Center" of the National Joint-Stock Company "The National Network of Auctions Centers".

It is planned to hold a similar seminar on 12 November in the city of Zhitomir upon request of Zhitomir Oblast State Administration. This seminar is aimed at a broader audience. It will be attended by directors of enterprises, arbitration managers, representatives of public authorities and local self-governance.

On 29-30 of November the Financial Restructuring Project will be holding a conclusive National Ukrainian Conference to debrief on the work of all six regional training centers from throughout Ukraine. During the period of activity of the Project, 200 specialists were trained in the field of restoration of solvency. There are over 40 successful examples of restructuring. All centers were very active while working in regions to create an effective infrastructure for application of the system of restoration of solvency through the procedure of bankruptcy in Ukraine. All this experience needs to be rolled out and made accessible for the broad public. Arbitration managers, specialists, directors of enterprises and representatives of government agencies will have an opportunity to discuss vital problems in the field of restructuring of enterprises in Ukraine, and possible ways to resolve them. The discussion is assumed to be useful and reach in its content.

OUR SEMINARS

Restoration of Solvency via Bankruptcy in Countries with Economies in Transition

This topic was chosen for the International Conference organized by Financial Restructuring Project. The Conference was held in Ukraine, in the city of Yalta on 11 and 12 of October. Whereas duration of the Conference was so small, its deliberations were intensive and the agenda was tight. The Conference was opened by the judge of the Higher Commercial Court of Ukraine, Member of the Presidium of the Higher Commercial Court, Head of the Department for Summarizing Practices of Application of the Legislation by the Higher Commercial Court Mr. Viktor Moskalenko. In his presentation he has dwelled upon the need to look for optimal ways for further reform of the Law "On Restoration of Solvency of the Debtor or Declaring it Bankrupt". According to Mr. Viktor Moskalenko, this process will be efficient only if it involves a broad circle of practical specialists, representatives of research institutions, and takes into account an international experience, including that of our closest neighbors – countries with transitional economies. This International Conference was held with the view to resolve these and other topical issues. It is very important to improve the level of legal culture necessary for a law-making process at all levels.

The first session was devoted to comparison of pieces of legislation and opportunities for restoration of solvency in other countries using the examples of Ukraine, Russia, USA and countries of Eastern Europe. At the first day presentations were delivered by Mrs. V.Danishevska, Director of Ukrainian Center for Commercial Law, Mrs. S. Rubtsova, analyst from Russian Society of Independent Experts and Crisis Managers, Mr. D.T. Shvidi, attorney and specialists on bankruptcy in USA, Mrs. L.Kamlenkova, Director of a Lawyer’s Company from the Czech Republic, as well as Mr. G. Glinka, Director of the Financial Restructuring Project. In the end of the session the participants were addressed by member of the Parliament of Ukraine Mr. V.O. Zachesov who has summarized deliberations at the first day of the Conference and shared his ideas about the prospects of Ukrainian Law.

After the end of the session the reporters have taken part in the press conference for Ukrainian journalists representing local and national publications and programs. A lot of interesting questions and comments from them were reflected on pages of newspapers and magazines.

The second day of the Conference was devoted to certain aspects of restoration of solvency and bankruptcy in various systems of legislation. At five consecutive panel discussions (1. Pre- bankruptcy activity, 2. Moratorium on Satisfying the Creditors Claims, Property of the Estate, Claims and Claims Register, 3. Reorganization, sanation, liquidation, amicable settlement, 4. Economic Implications of Reorganization, 5. Parties in Bankruptcy) the participants had an opportunity to discuss and consider the issues of concern for the audience in more specifically.

Generally, the Conference was very successful: all participants were happy that their expectations for a fruitful and informative communication have fulfilled. We hope that such Conference will become the first one in the line of similar effective public events intended to highlight problems of restructuring, restoration of solvency and bankruptcy in Ukraine.

A Charter Congress of the Union of Crisis Managers of Ukraine was Held on 29 September 2001 in the City of Kiev

A Charter Congress of Ukraine’s nationwide SRO "The Union of Crisis Managers of Ukraine (hereinafter referred to as Organization) has taken place on 29 September 2001 in the city of Kiev.

Participants from 15 regions of Ukraine have attended the Congress representing interests of arbitration managers, solvency restoration consultants, as well as managers of consulting and other companies. The Congress was attended by a member of the Parliament of Ukraine, representatives of the media and other honorary guests.

Agenda of the Congress:

1. Discussion of the procedure of representation of oblasts and making decisions at the Congress.
2. Chartering the Organization.
3. Approval of the name and the statute of the Organization.
4. Elections of governing bodies of the Organization.
5. Other organizational matters.

According the Law of Ukraine "On Associations of Citizens" in order to found a Ukraine’s nationwide SRO it is necessary to demonstrate participation of local branches representing over one half of territorial units of Ukraine (the minimal number of such territorial units is 14). The Congress has encompassed representatives of 15 regions of Ukraine that was a due basis for chartering the Organization.

One of the main purposes for establishment and formation of the Organization is fulfillment of comprehensive principles of democracy and transparency.

On the eve of the Congress, meetings of regional branches of the Organization were held in relevant regions. They have elected delegates who have represented a region at the Charter Congress. Delegates had the authority to vote on behalf of their regional branches. The voting has taken place as follows: one region – one vote.

As for membership in the Organization, a decision was taken that there will be a direct membership exercised directly through local branches on the basis of applications submitted. Both physical and juridical persons may become members (or a company’s staff members) so far as they have to do with procedures of bankruptcy, sanation, financial restructuring and liquidation.

Territorial units will be self-organized. Their chairpersons will become members of the governing body of the Organization – the Board. This will be the basis for the territorial principle of the Organization.

Structure of governing bodies of the Organization

The Congress is a supreme body of the Organization. In periods between congresses the powers of the Congress will be exercised by the Board. The Presidium and the President are executive bodies elected by the Congress. The Presidium will have the right take a decision to suspend powers of the President of the Organization upon the condition to convoke an extraordinary Congress within one month. In case the Congress declines such decision of the Presidium, the latter shall be dismissed and formed with new members. The Revisions Commission is an oversight body and is elected by the Congress. The President shall appoint the Directorate and delegate executive powers to it.

The Congress has elected members of the Revisions Commission and the Presidium.

The issue of elections of the President was quite acute. Several regions have nominated the first Vice-President of the Union of Arbitration Managers of Dnieper region, an arbitration manager from Kryvyi Rig Mr. Pavlo Mikhailidi. Kiev regional branch has nominated the Vice-President of Kiev Association of Insolvency Specialists Mrs. Lubov Motoriy to the position of the President. As she was already elected by the Congress as a member of the Presidium, her nomination was lifted. After that, representatives of Kiev regional branch have nominated Mr. Leonid Talan, the President of the Union of Arbitration Managers of Dnieper region for the position. He has declined his candidacy in favor of Mr. Pavel Mikhailidi.

After the debate, Mr. Pavel Mikhailidi was elected as the first President of the Union of Crisis Managers of Ukraine.

With the purpose to approve in-house provisions about membership and governing bodies of the Union, the Congress has decided to convoke an extraordinary Congress within one month after registration of the Organization in the State Department for Registration of Civic Organizations.

"It is very important for the Organization to be effective and to be able to achieve its declared goals and objectives. In our country there is a lot of civic organizations but not all of them are actually working to represent interests of their members. Nowadays, practitioners from all regions of Ukraine have come together, we will attract new members and make the Organization needed for and capable", – said the President of the Union Mr. Pavel Mikhailidi in his speech.

JUDGEMENTS OF EXPERTS

On Rights of a Security Holding Creditor in a Bankruptcy Procedure

Anatoliy Zhukov, Head of the group of expert lawyers of the Association of Ukrainian Banks, City of Kiev 

In their practice, creditors that have signed a loan security agreement with a debtor, often face issues related to implementation of their rights in the procedure of bankruptcy of a debtor.

In the procedure of bankruptcy, some rights of a security holding creditor are being waived or restricted by the Law of Ukraine "On Restoration of Solvency of a Debtor or Recognition of him as a Bankrupt" dated 30 June 1999 (hereinafter referred to as the Law).

At first, let us consider the right of a security holding creditor to apply to the court of law with a request to commence a bankruptcy case. A creditor whose claims are fully secured with a collateral does not have the right to file a petition for commencing a bankruptcy case against a debtor (see part 2 of the Article 8 of the Law). In judicial practice, a creditor’s being "secured" with collateral is verified by court through actual availability of a subject of collateral. When evidence is provided about an absence of a subject of collateral, a court of law accepts a petition on commencing a bankruptcy case from the creditor. Also, the court accept a petition from creditors in case an evidence is demonstrated that cash proceeds from sale of a subject of collateral were not sufficient for full satisfaction of claims of a creditor. Basically, such practice is not based on the Law, as neither actual absence of a subject of collateral nor partial satisfaction of claims of a creditor do not lower down the degree of security of a creditor. The right to security is terminated by loss of a subject of collateral, not by its absence (see Article 28 of the Law of Ukraine "On Security" dated 2 October 1992 – hereinafter referred to as the Law "On Security). A creditor whose claims are partially satisfied after sale of a subject of collateral does not seize to be a secured creditor for the remaining part of a debt with other assets of a debtor (see Article 24 of the Law "On Security").

An opportunity for a creditor to set claim to a subject of collateral with remain until the date of initiating a case of bankruptcy of a debtor by the initiative of any other creditor.

As a bankruptcy case is initiated, serving the proceedings by virtue of the part 8 of the Article 34 of the Law of Ukraine "On Executive Proceedings" dated 21 April 1999 will be suspended. Afterwards, a creditor may only set claim against pawned assets hold by third parties rather than by a depositing debtor, as it was alienated in favor of them without a consent of a depositing debtor (see Articles 17 and 26 of the Law "On Security").

After publication of an announcement about commencement of a bankruptcy case, a secured creditor, on the basis of the part 15 of the Article 11of the Law may file a petition on recognition of pecuniary claims against the debtor.

According to a petition filed by virtue of the Article 14 of the Law, a secured creditor shall be included into the register of creditors by an arbitration manager (see Part 9 of the Article 13 of the Law) and receive the right to get his claims satisfied in the first class (see Article 31 of the Law). In a bankruptcy procedure, consent of secured creditors is decisive when taking a decision to enter an amicable settlement by the committee of creditors (part 3 Article 35).

In the procedure of bankruptcy, satisfaction of claims of secured creditors is possible in the following instances:

• at the stage of disposal of assets, upon the condition of simultaneous satisfaction of claims of other creditors included into the register of creditors (parts 3 and 4 of the Article 14 of the Law);
• at the stage of sanation as a result of fulfillment of the plan of sanation (part 14 Article 21 of the Law);
• at the stage of liquidation (Article 31 of the Law) after sale of assets of a debtor.

The Law envisages that a subject of collateral may be used exclusively for satisfaction of claims of a security holding creditor (part 2 of the Article 26 of the Law). This is not specific for proceedings in a bankruptcy case and is true for any case of satisfaction of claims of a security holding creditor.

At the same time, the Law does not have a direct indication that satisfaction of claims of secured creditors will be made solely from proceeds of sale of a subject of collateral. Therefore, the procedure of bankruptcy follows a general rule provided for by the Article 24 of the Law "On Security". By its virtue, in case of insufficiency of proceeds gained from sale of a subject of collateral, a secured creditor has the right to receive satisfaction both from proceeds gained from sale of a subject of collateral and from sale of other assets of a debtor. Here, the amount of claims of a secured creditor will be defined pursuant to the Article 19 of the Law "On Security" and will include, in addition to an amount directly envisaged by a security agreement, any interest, compensation of damage caused by delinquency of execution, costs of maintenance of pawned assets as well as expenses for implementation of a claim secured with a collateral.

As the Law "On Security" does not link an amount of secured claims of a creditor to an amount of valuation of a subject of collateral, a creditor is entitled to demand full satisfaction of claims in his first class notwithstanding a valuation of a subject of collateral including such valuation in a bankruptcy procedure.

Regretfully, the conclusions described above were not directly reflected in the text of the law that causes multiple interpretations of the procedure of satisfaction of claims of a secured creditor in a bankruptcy procedure.

In particular, it is suggested to consider that a secured creditor is secured only for an amount of proceeds gained from sale of his subject of collateral. Therefore, the remaining claims of such creditor are to be satisfied in the fourth class of unsecured creditors rather than in the first class of secured creditors. Such interpretation is contrary to the Article 24 of the Law "On Security" that stipulates that security with the right of collateral also remains in case if proceeds gained from sale of a subject of collateral are not sufficient to satisfy claims of a creditor in full.

There is an interpretation by which a creditor is considered secured for the amount of valuation of a subject of collateral made in the procedure of bankruptcy of a debtor. Such interpretation also contradicts with the Law "On Security" that does not contain any linkage between an amount of security and valuation of pawned assets. Moreover, the valuation of pawned assets was excluded in the Law "On Security" from the list of substantial conditions of a security agreement. The above underlines one more time that a creditor is considered secured for the entire amount of his claims notwithstanding valuation of pawned assets if otherwise not set forth in the text of a security agreement.

Russian legislators did not believe it unnecessary to reiterate the rights of a secured creditor provided for him by the legislation on security one more time in the Law of the Russian Federation "On Insolvency (Bankruptcy)". So, the Article 109 of the Law of the Russian Federation "On Insolvency (Bankruptcy)" stipulates that claims of creditors on liabilities secured with collateral of assets of a debtor shall be satisfied in the class of secured creditors on the account of all assets of a debtor including those not subject to the above mentioned collateral.

By opinion of the author of this paper, it would be useful to reiterate rights of a secured creditor in Ukrainian law as well.

Even in case of preservation of rights of a secured creditor for a subject of collateral in the procedure of bankruptcy, inclusion of pawned assets into general bankruptcy estate would substantially lower a probability of full satisfaction of claims of a secured creditor at the stage of liquidation.

Practitioners are aware that in liquidation of a company proceeds from sale of assets of a company under liquidation are substantially smaller than the value of the same assets if sold outside liquidation. As a result, when assets of a company being liquidated are sold, fewer creditors may get satisfied. Chances of a debtors (equity holders of a debtor) to get hold of assets that remain after satisfaction of claims of a creditor are shrinking.

Therefore, at the stage of liquidation of a company, inclusion of a subject of collateral into bankruptcy estate of a debtor it not beneficial for anyone: neither creditors nor debtors!

Hence, in case if pawned assets are not used directly at the stage of sanation for restoration of a normal business activity of a debtor (for example, shares owned by a debtor), creditors and debtors find it beneficial to sell such a subject of collateral at the stage of sanation and to use the proceeds for satisfaction of claims of creditors. Such a sale may be performed within a plan of sanation of a debtor by an arbitration manager or by an executive service.

According to the part 8 of the Article 34 and the Article 35 of the Law "On Executive Proceedings", serving the proceedings is not terminated as a bankruptcy case is commenced. It is suspended "until the case is reviewed in its merit". Hence, an executive service may resume serving the proceedings after an issue is reviewed in its merit. We still have to find out what does it mean "to consider a case in its merit" in a bankruptcy case.

For this purpose we shall consider a sequence of court sessions to review a bankruptcy case and issues to be considered by court in such sessions (see Article 11 of the Law). After receiving a petition of an initiating creditor, the court shall appoint a preparatory session, than a preliminary session. Afterwards, there is a session without a name that may be called a concluding one.

A concluding session of a court that follows a preliminary court session completes a review of petitions of creditors with description of their claims against a debtor. At this session a court takes a decision to apply sanation or liquidation procedures. During these procedures it is for an arbitration manager rather than for a court to satisfy claims of creditors satisfied by court.

Therefore, it is at the court session that follows a preliminary court session where consideration of petitions of creditors in their merit is being completed. After that, executive proceedings for setting a claim against a subject of collateral may be renewed except for the case when the court at its concluding session takes a decision to open up a liquidation procedure. In this case, a subject of collateral, since the date of opening of a liquidation procedure, pursuant to the Article 26 of the Law becomes part of the overall bankruptcy estate which is being sold by a liquidator rather than by the executive service (article 30 of the Law).

Before the date of opening of a liquidation procedure, setting up a claim against a subject of collateral may be renewed, as a subject of collateral may be sold by an executive service if so envisaged by the plan of sanation of a debtor. Validity of a moratorium is not an obstacle for implementation of measures outlined in the sanation plan (see for details: Buhgalteria journal, issue of 25 September 2000, #39, page 117).

Though satisfaction of claims of secured creditors is defined by the Law as part of the first class of creditors, for the reason of validity of a moratorium and of the need for minimally necessary expenditures of a debtor and of expenditures for remuneration for services of an arbitration manager, these claims are practically settled after:

• satisfaction of claims of creditors not covered by the moratorium (part 4 of the Article 12 of the Law);
• payment of minimally necessary expenditures of a debtor for security, electricity, communications, utility services, remuneration for services of an arbitration manager);
• payment of expenses for procedures of disposal and sanation, including payment for services of an arbitration manager and specialists.

In view of the above, secured creditors are actually the fourth class of creditors instead of being the first one because creditors of the second class and partially those of the first and the fourth class as referred to in the Article 31 of the Law are actually being satisfied before them. Hence, in practice the contradiction between the norms that set forth a moratorium and classes of creditors was resolved, as it was pointed out by specialists. However, this does not exclude the need to resolve a controversy found in the Law.

We remain in hope that secured creditors well be able to implement the rest of their rights provided for to them by the Law "On Security" in spite of the limitations of their rights in the bankruptcy procedure described above.

THE NEW CENTER IN DONETSK

In July of 2001, a training center of the Financial Restructuring Project performed in Ukraine by "Deloitte Touche Tohmatsu" company under financial support of U.S. Agency for International Development has started to operate in the city of Donetsk.

Nowadays one can make a tentative summary of activity of Donetsk Center and draw a circle of problems topical for this region of Ukraine. The region houses a high concentration of fuel and energy industry, mining and metallurgy, heavy machine-building. Such enterprises are energy intensive ones and have a high level of permanent costs, which makes them less competitive.

Since enactment of the new Law of Ukraine "On Restoring Solvency of a Debtor or Declaring it Bankrupt", i.e. since 1 January 2000, 1 476 cases were initiated in Donetsk oblast, of which 94 enterprises undergo a sanation procedure and 91 amicable settlements were concluded. According to the data of the Commercial Court of Donetsk oblast, in 60% of all bankruptcy cases the proceedings are conducted pursuant to the Article 52 of the Law, which envisages bankruptcy of absent debtors. The majority of other cases are conducted against small and medium enterprises. The large ones, especially those central for municipalities they are located in, try to keep "floating", however, most of them are "at the edge of bankruptcy".

Logically for the market economy, these enterprises would have had to undergo a bankruptcy procedure, at least in order to get rid of inefficient production and the so-called non-productive sphere, thus allowing competitive parts of production to operate and develop, and to provide so much needed jobs. The difficulty is that thousands of people stay behind such enterprises, and the psychological factor plays a key role here. The majority of managers of enterprises were brought up by the past economic system when a bankruptcy procedure could never have happened, even in theory. A traditional view of bankruptcy is associated by them with a disaster, with something horrible that causes unimaginable negative consequences for all. This perception is further confirmed by examples from well-known works of classic world literature, where characters prefer death to public announcement of bankruptcy.

Thanks to the new Law, attitude to bankruptcy is changing cardinally, as it creates conditions and contains incentives aimed at restoration of solvency of an enterprise with the use of bankruptcy procedures rather than its liquidation. Here, a wide rage of economic and legal measures is used. This is based on the very title of the Law which starts with the words "On Restoration of Solvency of a Debtor…".

Ideally, the procedure of bankruptcy has to work efficiently, i.e. quickly and qualitatively. It has to promote restoration of financial health of the economy and removal of uncompetitive burden. However, in order to finally cut this Gordian knot consisting of unpayments and insolvent enterprises, the state, first of all, lacks a political will, while the lack of financial capabilities is only a subsidiary reason. This is the only explanation of continuing attempts to safeguard certain enterprises from bankruptcy, as they fail to find their niche in business and earn profits.

Managers of enterprises, as they recognize all responsibility carried by them, a most willing to resuscitate a company staying at the edge of dying, to preserve jobs, to regularly pay wages and taxes to the budget. However, this willingness is not enough. For this purpose, they should actively use mechanisms prescribed by the Law. In Donetsk region, there is a substantial experience of successful application of the Law "On Restoration of Solvency …". Just among the enterprises assisted by specialists of the Financial Restructuring Project, one can accentuate Private Joint-Stock Company "Gorlovskiy Meat-Packing Plant, Public Joint-Stock Company "Victory of Labor" (the city of Artyomovsk), Public Joint-Stock Company "Konstantinovskiy Glass Factory".

An objective of Donetsk center is to roll out a successful experience of application of the Law, organize regular seminars for specialists in solvency restoration and managers of enterprises. So, on 13^th and 14^th of September, seminars for arbitration managers were conducted on: "Some issues of application of the Law of Ukraine "On restoration of solvency of a debtor or declaring it bankrupt" for restructuring of enterprises"; and for managers of enterprises: "The Law of Ukraine "On restoration of solvency of a debtor or declaring it bankrupt" as an efficient way to assist Ukrainian enterprises". During the seminars, the difference was highlighted in approaches to extinguishing arrears of enterprises before the budget in the laws "On restoration of solvency of a debtor or declaring it bankrupt" and "On the procedure of extinguishing liabilities of taxpayers before budgets and state earmarked funds", as well as expected changes in the legislation on bankruptcy, the issue of pecuniary obligations in a bankruptcy procedure at various stages of the process, and capabilities of the computer model of restructuring of enterprises. Participants of seminars were satisfied with information they have received and with answers to their questions by specialists of the Financial Restructuring Project Mr. V.Khandus, Mr. A.Volkov, Mr. V.Gusak.

Mr. Boris Poliakov, the judge of the commercial court of Donetsk oblast, has told participants of the seminars about typical problems that emerge in proceedings on bankruptcy cases, as well as specific features of approval of a sanation plan and an amicable settlement, and has presented his book titled "The procedure of bankruptcy in Ukraine: theory and practice" to participants. Mr. Sergey Karandin, director of Private Joint-Stock Company "Gorlovskiy Meat-Packing Plant" has shared his positive experience of restructuring of an enterprise. Mr. A.Makhmudov, president of Public Joint-Stock Company "DIKOM" Investment Company" has demonstrated for the participants that a comprehensive approach is needed while fulfilling sanation of an enterprise. Representatives of the Main Department for Industry of the Oblast State Administration, the Oblast Department on Bankruptcy of the Ministry for Economy, the Oblast State Tax Administration, were present at the seminars. They have provided full answers to questions asked by participants.

Journalists of local media invited to the seminars have acknowledged the topicality of such seminars for enterprises of the region.

On 28^th of October, specialists of the Project, by invitation of the city mayor Yuriy Rozhenko, have visited the city of Konstantinovka. There, they have conducted a one-day seminar for managers of enterprises of the city. Participants of the seminars performed have acknowledged a practical integrity of these meetings both for arbitration managers, and for managers of enterprises, and for representatives of the executive and judicial branches of power.

Similar field seminars are planned to be conducted in the cities of Artyomovsk (November) and Mariupol (December).

At seminars, specialists of the Project have comprehensively highlighted real outcomes of application of the Law. Therefore both managers of enterprises and arbitration managers approach Donetsk training center. Independence of the Project allows to build open relationships with them. This helps to freely exchange information and to display a sincere interest to problems of enterprises and to achieve the highest objectivity in resolving these problems.