#Mr. A, who runs an automobile maintenance company, lost all his assets and applied for personal ban..

#Mr. A, who runs an automobile maintenance company, lost all his assets and applied for personal bankruptcy after making a joint guarantee on the company’s loan. Mr. A received an exemption decision last year, but the credit transaction was virtually blocked as the exemption record was registered as public information by the Korea Credit Information Service for five years.

The problem did not stop at Mr. A’s individual. As the company’s management has normalized, it will pay about 500 million won in corporate tax alone this year and earn 10 million won per month personally, but the financial sector is restricting corporate loans due to his record of exemption.

In the case of individual bankruptcy debtors like Mr. A, related records are maintained as public information for five years even after immunity. On the other hand, individual rehabilitation debtors can delete public information records early if they faithfully implement the repayment plan for one year.

Considering the purpose of the system to help return to economic activity through immunity, it is pointed out that it is necessary to examine whether it is appropriate to maintain public information registration only for individual bankruptcy exemptions for a long time. At least for debtors who are continuing normal economic activities, it is necessary to consider special cases for early deletion.

The Korea Credit Information Service has registered public information since the decision to indemnify individual bankruptcy and individual rehabilitation debtors so that the financial sector can use it for credit evaluation. In July last year, the Financial Services Commission decided to delete rehabilitation information early if the repayment plan is faithfully implemented for one year in the case of individual rehabilitation.

However, personal bankruptcy was excluded from early deletion due to the possibility of complete legal and economic immunity. As a result, it is difficult for individual bankruptcy indemnifiers to conduct credit transactions under their names for five years, which effectively restricts their economic activities.

Considering that both individual bankruptcy and individual rehabilitation aim to raise the economy through immunity, there is no reason to change whether to delete it or not. The longer the information registration is, the more difficult it is to return to economic activity due to long-term credit transactions and the greater the possibility of secondary bankruptcy.

As a result, debtors are also avoiding personal bankruptcy applications. In terms of financial situation, you have to apply for personal bankruptcy, but you are applying for individual rehabilitation.

In addition, in personal bankruptcy, non-indemnity bonds are recognized more widely than individual rehabilitation. This means that even after the decision to indemnify, there may still be debts to be repaid. For this reason, some point out that there is not enough evidence to give more preferential treatment to individual rehabilitation debtors just because they presuppose partial reimbursement.

“If public information remains for a long time even after immunity, the purpose of the bankruptcy system of ‘starting anew’ will inevitably weaken,” said Jeon Dae-kyu, a former senior judge at the Seoul Rehabilitation Court and an adjunct professor at Ewha Womans University’s law school. “If it is difficult to delete it uniformly early, it is necessary to recognize special cases of early deletion of public information even for individuals who are engaged in normal economic activities.”