Legal thinker revitalizes bankrupt enterprises
In China’s supply-side reform, industrial optimization and reorganization is an important task. Lu Xiaoyan, a judge of Wuxi Intermediate People’s Court, is renowned for her great devotion to revitalizing local bankrupted enterprises.
Since 2013, she has obtained many honors including “Young role model around us”, “Top ten reliable judges in Wuxi”, “National excellent judge”, and “National model judge”.
China has recently introduced the supply-side reform to increase quality and efficiency of economic growth and provide a growth impetus for sustainable economic development.
Wuxi Suntech Power Co., Ltd, once the world’s largest company in photovoltaic technology, faced bankruptcy reorganization in 2013 and Lu, responsible for this case, took advantage of the spontaneity of the market to help it revive during an economic downturn.
“Will money be repaid? How? Where will it come from?” Lu Xiaoyan still remembers the first creditor conference in 2013, where these questions were asked many times. She said that the bankruptcy administrator heard 533 creditors’ claim declarations which amounted to 7.5 billion RMB more than the company’s book debt.
She made a clear distinction between the duty of the government and the market, and prioritized protection of employees’ legal rights and guarantee of their participation rights.
“Lu Xiaoyan’s work has several characteristics: many enterprises’ revival, high employee debt reimbursement, and efficient trial procedures, a staff member of People’s bank in Wuxi said.
Courts in different regions may face common problems such as difficulty in selection of a bankruptcy administrator, asset realization and staff resettlement which may slow down the trial process and make an enterprise’s revival untenable.
“Lu, equipped with strong legal thinking, demonstrates excellent judicial skills in handling bankruptcy cases,” commented the Wuxi Municipal Commission of Economy and Information Technology.
In the bankruptcy case of the listed company Zhongda United Holding Group and its related enterprises, Lu Xiaoyan digested law, regulations, legal theory and securities regulatory policy and was able to achieve reorganization of 20 companies with the help of four principal debtors. She broke the record for reconstructing the most companies in the shortest time.