Any look at recent retail liquidation trends must begin with the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 (BAPCPA).Some provisions of BAPCPA favor the interests of certain creditors over a debtor, especially so when the debtor is a retailer. If the debtor is an individual (or husband and wife), there are additional document filing requirements. A husband and wife may file a joint petition or individual petitions.
As businesses continue to falter and fail due to the continuing financial crisis, it is likely that liquidations by Chapter 11 sale motion will continue to gain popularity.This chapter of the Bankruptcy Code generally provides for reorganization, usually involving a corporation or partnership. A chapter 11 case begins with the filing of a petition with the bankruptcy court serving the area where the debtor has a domicile or residence. A chapter 11 debtor usually proposes a plan of reorganization to keep its business alive and pay creditors over time. In addition, no individual may be a debtor under chapter 11 or any chapter of the Bankruptcy Code unless he or she has, within 180 days before filing, received credit counseling from an approved credit counseling agency either in an individual or group briefing. A petition may be a voluntary petition, which is filed by the debtor, or it may be an involuntary petition, which is filed by creditors that meet certain requirements. If you're a small business owner pondering bankruptcy, you have a few filing options.While some would mean an end to your entrepreneurial dream, others may let you continue to operate your business while paying off your debts.