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En masse liquidation plagues Hungary

Hungary had the highest rate of liquidation procedures in Europe last year, business daily Világgazdaság reported. H1 saw 2.1% of Hungarian businesses go into liquidation, an exceptionally high figure in comparison with the 0.8% EU average. The number of liquidations initiated in this period was 19,000, a 2,000 increase on H1, 2003 ? however, less than 50 bankruptcy proceedings took place in the meantime. It is now widespread practice for insolvent businesses to transfer their assets into another company to avoid bankruptcy proceedings. The reason for this is that the Bankruptcy Act, approved 15 years ago, is self-contradictory and over-complicated, the newspaper noted. A new Bankruptcy Act is currently in the drafting process.