A U.S. congressional draft bill to help rescue Puerto Rico from its economic crisis was released this week and contained elements of U.S. bankruptcy law. The draft includes sections of the U.S. Bankruptcy Code that allow bankrupt entities under certain circumstances to force creditors to take reduced payouts.
Puerto Rico has $70 billion in debt and has an unfunded state pension liability of nearly $44 billion. The new bill will provide Puerto Rico the tools to impose discipline over its finances, meet its obligations and restore confidence in its institutions.
The bill would also create a federal board to oversee the island’s finances, monitor its accounting and help curb spending. It would also require Puerto Rico to make efforts to restructure debt consensually with its creditors.
If the talks failed, the island or its public entities could file for a court-supervised debt restructuring process based on key statues within U.S. bankruptcy law. That would allow Puerto Rico to force such deals on holdout creditors.
Click here to read more on this story.
If you are in financial crisis and considering filing for bankruptcy, contact an experienced Miami bankruptcy attorney who can advise you of all your options. As an experienced CPA as well as a proven bankruptcy lawyer, Timothy Kingcade knows how to help clients take full advantage of the bankruptcy laws to protect their assets and get successful results. Since 1996 Kingcade & Garcia, P.A. has been helping people from all walks of life build a better tomorrow. Our attorneys’ help thousands of people every year take advantage of their rights under bankruptcy protection to restart, rebuild and recover. The day you hire our firm, we will contact your creditors to stop the harassment. You can also find useful consumer information on the Kingcade & Garcia website at www.miamibankruptcy.com.