Prepius

From partial to general: as private executors support creditors

The reform of the system of execution of court decisions was delayed: private executives, on which Ukrainian lenders pledged special hopes, have not yet been able to drastically change the situation with the collection of bad debts.

The potential in the updated system is, say bankers: the speed of private traders times exceeds the rates of their colleagues from the State Bailiff Service.

The key issue on the side of the Ministry of Justice, which considers this reform one of the main achievements of last year: the ministry could not solve the issue of operational certification of private performers, having registered in the system only 100 active participants per year. According to the calculations of the Ministry, the Ukrainian market needs 20 times more private performers.

How the updated system works and what the reason for the problems arose was the Ministry of Finance.

IDEOLOGICAL EFFECT

The first private performers began work in August-September last year. According to the Ministry of Justice, at the time of the beginning of the reform, the level of execution of court decisions in Ukraine was 6%. The system employed almost 4,000 public executives, which accounted for 4 million cases. According to Justice Minister Pavel Petrenko, 80 first private performers have increased the share of executed decisions to 18%.

"We were really surprised by the first results: if the employees of the ICS went to recover 420-450 days from the date of the court decision, private traders managed to invest in 90 days", - says Olena Suprun, head of the Innovation Center of the collection of Alfa-Bank and Ukrsotsbank.

As the deputy minister of justice Sergey Shklyar has specified, "the Ministry of Finance", private traders have brought to recovery about 80% of the started production. It takes about 14 days for individuals to collect property from private enforcement agencies.

According to Yulia Karpets, advisor to the chairman of the board, the idea of the Bank on legal issues, the quantitative indicators of the work of private traders on the scale of the banks are not so noticeable yet. According to her, bankers were more concerned about the lack of competition and the low motivation of public sector executives.

"The main change, rather, ideological: there was an alternative in the choice of institutions between the state and private executors in the process of enforcement of decisions of courts and other bodies. But speaking as a whole, it has not yet been affected by the efficiency of the results of bank deposits collection, "says Karpets.

Another qualitatively new point - to follow the course of enforcement proceedings can be on the site of the Misund in the system ASIP (automated system of executive proceedings).

MOTIVATION WITHOUT WARRANTY

The reason for the higher efficiency of private traders is obvious: they are interested in getting their remuneration as quickly as possible - 10% of the amount collected, explains Elena Suprun.

According to Yulia Karpets, especially promptly, private executives work in cases where the debtor is a large legal entity with turnover, active production and mortgages in the form of real estate. But at the same time, the involvement of a private trader does not guarantee a quick recovery.

"For example, under a mortgage loan without a moratorium and obstacles of the debtor, the mortgage will be transferred to the trading organization at the first auction with the date of their appointment only on the 90th day. This is due to the rules of execution of executive actions. That is, in this case, 90 days is a minimum, because charging is not a bidding but a receipt of real money, "says Karpets.

According to Suprun, private traders also influence the efficiency of colleagues from GIS, who had previously been less motivated due to inherent bureaucratic state structures, as well as lower rates of remuneration.

"With the advent of private traders, state executors also intensified. I do not want to swear GIS, but the preference of private performers was initially obvious: one car is easier to turn than colonies, "Suprun said.

NOT ANYTHING TODAY

Despite the local effectiveness of private performers, they have not yet demonstrated the global effect. According to Julia Karpets, private traders are still critically few, and in some regions of Ukraine they are not represented at all.

Ukraine needs at least 2,000 private traders, say the Ministry of Justice. According to Pavel Petrenko, only last year applications for the status of private performer filed more than 1000 people. Only 100 of them received real work permits.

In order to become a private executor you need to go through the training and pass the qualification exam. Not all are able to cope with the task: according to the results of the last qualification (the exam passed on February 19), only 7 of the 18 applicants received an executive certificate. On January 29, 6 candidates successfully completed the training, and 15 more people failed to pass the exam.

"Previously, training was held only under the Ministry of Justice, we have now agreed with the Odessa Jurassic Academy, which has to accelerate the process. In general, we want the performers to study in the field, and in Kiev only came to pass the exam ", - Sergey Shklyar told the Finance Ministry.

According to him, the Attestation Commission under the Ministry of Justice because of the disagreement schedule of its members has time to take no more than two exams per month.

FUTURE AND TODAY

The relatively low competition and the lack of a sufficient number of skilled personnel allows existing private executives to dictate the rules of the game to their customers.

As Julia Karpets notes, often they refuse to deal with too small, in their opinion, cases. In some cases, private traders, feeling their lack of alternative, can perform work poorly, Karpets adds. For example, there are precedents when the debtor's property was described as blind, without going to the place.

"Private executives build their business model so that it is not unprofitable. Therefore, they try to work with cases in the production at which costs (monetary, time, etc.) will be less. Mostly, they refuse to work with unsecured debts for small amounts, as well as loans secured with movable property, whose searches require costs, "explains Karpets.

Bankers are not yet about to give a clear assessment of the reform - this requires that at least one year has passed since its launch. In the future, financiers expect more visible performance of private performers. According to Minister Petrenko, an increase in the number of private traders to 2,000 people will increase the level of execution of court decisions in Ukraine to 60-70%.

Posted by Olga Tereshchenko

(translated using google translate)