Kiri

Kela has a number of cases pending that involve the collection of child support debt, and where the debtor (who lives in Estonia) is undergoing insolvency proceedings in Estonia. Usually this involves a bankruptcy. According to the Regulation (EU) 2015/848 of the European Parliament and of the Council on insolvency proceedings, any foreign debt that a debtor has also comes within the scope of any insolvency proceedings opened in Estonia. This means that any child support debt that a client of Kela who is the subject of insolvency proceedings may owe to us should be included in Estonian insolvency proceedings. The basic principle here is that the issues addressed in the insolvency proceedings and their legal ramifications for creditors are determined based on the legislation of the state in which the insolvency proceedings were opened. Some of the central government authorities collecting child support debt include the debt owed to Kela in their local insolvency proceedings and will monitor the progress of the proceedings on our behalf. In view of the above, we would like to inquire if the competent authority in Estonia also could see to it that the child support debt owed to Kela is included in bankruptcy or other insolvency proceedings that are started in Estonia and to monitor the progress of the proceedings. Additionally, we would appreciate further information about the substance of the Estonia bankruptcy law and the status of child support debt in Estonian bankruptcy proceedings against natural persons. We looked at the content available on the European e-Justice Portal (European e-Justice Portal - Insolvency/bankruptcy (europa.eu)) concerning the insolvency proceedings in Estonia, and found useful information, but we still have many questions. We would welcome your replies to the following questions:

• It is our understanding that bankruptcy proceedings in Estonia only deal with that portion of child support debt which was accrued/became due prior to the start of the proceedings. Have we understood this correctly?

• What is the procedure for collecting/paying off debt that becomes due after bankruptcy proceedings are opened? Can the competent authority continue to collect debts that are not covered by the bankruptcy after bankruptcy proceedings have been opened? If the debtor does not pay child support that falls due after the bankruptcy proceedings are opened, they will incur additional child support debt. Should they continue to make monthly child support payments also during the bankruptcy proceedings? Or should they negotiate with the bankruptcy administrator about the payments?

• Creditors are expected to notify their claims by a specific deadline. Is child support debt considered privileged debt under Estonian bankruptcy provisions? If so, must creditors make an express demand that their claims are privileged as part of the proof-of-debt process/in their notice of claims? What legal provisions is the privileged status based on?

• In bankruptcies involving natural persons, there is in Estonia also the option to discharge debt. According to our information, that procedure is launched contemporaneously with the declaration of bankruptcy. Are child support debts covered by the debt discharge procedure? If not, are creditors expected (either as part of the proof-of-debt process or otherwise) to present a written claim for the child support debt to be left outside the discharge of debt process? At what point should they present such a claim? Can child support debt be collected while the debt discharge procedure is ongoing? If yes, how is this done and what portion of child support debt can be collected while the debt discharge process is ongoing? The debtor may incur additional child support liabilities during the debt discharge process that they should pay monthly based on a maintenance agreement or court order. How and from which source can creditors find out that the debt discharge procedure has been concluded?

• If creditors do not assert their claims against a child support debtor by a specified deadline, do they forgo the right to collect the debt? How should creditors proceed if they do not learn that the debtor is in bankruptcy until after the specified deadline has passed?

• Does Estonian bankruptcy contain provisions regarding the statute of limitations treatment of debt during or after bankruptcy proceedings? If child support debt that is not covered by bankruptcy cannot be collected during the bankruptcy proceedings, is the statute of limitations extended on account of the bankruptcy?

Best regards,

Antti Partanen

lakimies, varatuomari

Kela, lakipalveluryhmä
Suokatu 40, 70101 Kuopio

040 355 9658

e-mail. [email protected]