The “helping” hand for people in debt

=== '''Preventive measures''' === Preventive measures are about trying to prevent the situation of over-indebtedness. It is very important that these measures are taking in different domains of society. Yet this is very difficult to accomplish, the goods, cooperation and the knowledge are not always present or accessible.

To gain knowledge, the Flemish Debt Centre tries to invest in scientific research about over-indebtedness. They own some figures, but a more profound research could be a big help in supporting their preventive actions.

Secondly, prevention on structural level. This centre is occupied with improving the legal framework for client protection. It is proven that abuse is not something exceptional anymore. The Centre aims at a better control of the legislation which protects clients. They also want the minimum wage and alimony to adjust to the ageing of the population. Yet the goal is to achieve a prevention over several domains, the centre wants the education system to show the risks of over-indebtedness and of making debts. This requires a lot of skills. The younger generations need to know something about our consumption-oriented society.

The next goal is to achieve quality aid. Victims of over-indebtedness often have a stressful and psychological hard living condition. It is important that the context of the over-indebtedness changes as well. People need help to change their living conditions, to handle the problem. But the social workers often have no time, because of the many cases, to interfere in the daily life of the debtors. So more goods are needed to provide a quality aid for every person in need, which also means that the social workers need permanent education on how to provide good aid for every case. Because the amount and the complexity of the cases increase prominently.

The fourth aim is to have constant learning social workers and conciliators. It is important that different categories of the population have a specific treatment to help them as much as possible. For every category, they have specific actions and measures to be taken (Vlaams Centrum Schuldenlast,2011).

=== '''Existing legislation – enterprises''' === As there is no such legislation for individuals there are Belgian measures against over-indebtedness, called ‘the law continuity of enterprises’. The law provides two options in order to avoid bankruptcy. The first option is an agreement between the indebted company and one or more of its creditors. There are no rules about what has to be written in the agreement, this is completely up to the creditors and the company. This measure proves to be not the best solution, as the creditors have the possibility of refusing the agreement.

The second option is the judicial reorganisation. A merchant has to request this in the court. From the moment he handed in his request for judicial reorganisation, he is automatically protected against bankruptcy and seizure. The judicial reorganisation gives three possible options. The first one is an agreement similar to the one already explained above, but then with a repayment period imposed by the judge. The second option is a collective agreement. In this measure a debtor is obliged to submit a repayment plan to the judge. In this plan one has to tell how he will repay his debts in a maximum period of five years. When the majority of the creditors agrees to this plan, it enters into force. The third option is a transfer to judicial authorization. In this option a judicially authorized agent will reorganize your business. One can ask voluntarily for this measure or can be imposed by the judge.

The effectiveness of this law is questioned, because a lot of businesses (about 70% of them) go bankrupt even after using this measure.

Indebted companies, that cannot pay their bills, go bankrupt. A merchant can ask for bankruptcy himself or this can be imposed by the creditors or the public prosecutor. After the application for bankruptcy, the judge will appoint a liquidator. He makes a list of all the debts and the goods and property of the bankrupt company. Then all the belongings of the company and some of the belongings of the merchant are sold. The remaining debts are paid by the former owner of the company, but sometimes the judge can acquit the debtor.