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Publication(Washington DC, 2004-03) World BankThe Bank assessed the Mauritius insolvency and creditor rights systems pursuant to a joint IMF-World Bank initiative to develop reports on the observance of standards and codes ("ROSC"), based on the Bank Principles and Guidelines for Effective Insolvency and Creditor Rights Systems during 2002. The assessment team interviewed a cross section of country stakeholders regarding the effectiveness of the legal infrastructure, and its implementation supporting debtor-creditor relationships, corporate insolvency and credit risk management and resolution practices. Conclusions in this assessment are based largely on a review of applicable legislation and information gathered through interviews conducted by the staff team, and other inputs provided by the Steering Committee on Insolvency and Creditor Rights set up by the Government of Mauritius in January 2003. In addition, five commercial banks provided responses pertaining to credit risk management and corporate recovery practices with respect to distressed assets. Policy recommendations include: creditors rights and enforcement areas, some fine tuning is required to broaden the use of security interests on movable and immovable property, and to ascertain the maximization of the value of the assets for sale upon seizure; enforcement procedures should be streamlined further by accelerated debt recovery rules and more efficient procedures for execution, enforcement and auctions; Credit Information Bureau should be established in Mauritius, and, the government should encourage the development of Credit Rating Agencies. On the legal framework for corporate insolvency, a global reform of the insolvency procedures should be pursued in order to provide Mauritius with a modern and efficient commercial insolvency law. It is also recommends the necessary amendments to the Bankruptcy Act and Bankruptcy Rules to take care of both traders, non-traders and companies insolvencies, and, the harmonious and uniform recovery procedures for all debts, including amounts due to the State.
Publication(Washington, DC, 2002-02) World BankThe legal environment in Lithuania to support creditor rights and debt enforcement is reasonably effective, and collateral regimes have been largely centralized and modernized. Consistent with a modern system, security interests may be granted in immoveable and moveable assets, including equipment, inventory, goods, receivables, and future property. In practice, security tends to be restricted to more reliable and liquid assets, such as immovables or fixed assets. Markets for moveable assets remain poorly developed or illiquid. Appeals remain a source of delay, and other procedures could be improved. The insolvency process in Lithuania has been almost exclusively one of liquidation, plagued by delay and procedural obstacles. A new insolvency law was adopted in July 2001, bringing to three the number of insolvency laws currently in effect. At the same time, a new Enterprise Restructuring Law became effective. As of November 2001, only a few cases had been filed under the new law, which a growing consensus of stakeholders consider to be unworkable and unfavorable to creditors. The process may be aided by the developing training guides and programs. Regulation of insolvency remains fragmented and weak, but shows evidence of an evolving structure. Court efficiency is stifled by a lack of specialization among judges, who are overloaded and poorly equipped to deal with bankruptcy cases, especially rehabilitations. The administrators' profession is marked by low standards, over-licensing, inadequate training and skills, and inconsistent performance. While much remains to be done, the national association of bankruptcy administrators is working to improve licensing standards and to strengthen continuing education and training for its members.