PHILIPSBURG--Monday’s Central Committee hearing on pending changes to the Bankruptcy Law (1931) gave way to the need for better protection of workers’ rights and to halt the practice of businesses filing for bankruptcy only to reopen under another name to carry out the same services immediately after.
Members of Parliament (MPs) questioned Bar Association President Remco Stomp and association representative Hendrich Seferina, as well as St. Maarten Chamber of Commerce and Industry President Arthur Bute, Vice President Ludwig Ouenniche and Treasurer Abdul Meyers about their take on the law changes.
Due to concerns raised by MPs, President of Parliament said in order not to halt the dealing with the draft at this stage, discussions should continue in the Parliament’s Permanent Committees for Finance and Justice.
Stomp explained that the most important change was the prevention of companies moving money and/or assets into a trust company if they anticipated bankruptcy proceedings. He said this was most welcome, as it would protect the interest of the creditors who, if the assets were moved, would suffer losses, while the company representatives could restart operations under another name and licence.
The change would allow trustees to review a 40-day period prior to the bankruptcy filing to determine whether assets had been hidden. Stomp said this period is too short and suggested that this be increased to a year.
Bute said that the changes would not affect the operations of the Chamber, because it basically had to follow the court’s verdict if a company had been declared bankrupt and make adjustments to its business registry. A total of 84 businesses went bankrupt in 2011, according toBute.
Elaborating further, Ouenniche said the Chamber’s role had already been regulated concerning bankruptcies and court orders under the former Netherlands Antilles. He said the Chamber has been complying with the regulations that govern it.
United People’s (UP) party MP Jules James’ questions about the common occurrences in bankruptcy proceedings sparked a discussion and veiled references from other MPs to the bankruptcy of Pelican Resort and the opening of Simpson Bay Resort in its place. James is the resort’s General Manager.
MP Johan Leonard (UP) asked about what protection the law provides for workers of bankrupt companies. Stomp said with a bankruptcy proceeding, workers were simply out of a job.
MP Leroy de Weever (Democratic Party) enquired what Parliament could do to put employees in “a favourable position.” Seferina answered that a salary guarantee system, as in place in The Netherlands, could be looked into. The system could see to it that workers continue to get a salary during a bankruptcy proceeding. The fund for the employees could be paid back into the system once the trustees have cleared debts to the main creditors.
MP Louie Laveist (National Alliance) also had concerns about the protection of employees in cases of bankruptcy. He further asked about the practice of companies to buy assets of a connected company in bankruptcy cases and to continue with the business without much interruption.
Seferina and Ouenniche said this practice was seen throughout the business world. Ouenniche said it was more visible in St. Maarten because of the close-knit community.
Bute suggested that the tripartite labour committee as well as unions be heard on the issue of bankruptcy.
MP Dr. Lloyd Richardson (NA) asked Stomp if he was satisfied with the way bankruptcies were handled. Stomp said that MPs made the laws and attorneys had to live with them.
MP Silvia Meyers-Olivacce (UP) called on fellow MPs to work on going deeper into details of the bankruptcy law and to find ways to protect the workers.
Pantophlet and others were also interested in this further review.
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