The U.S. Trustee Program has some 250 new trustees at the ready to assist with small business cases as a change in bankruptcy law intended to make it easier for smaller companies to reorganize goes into effect, Bloomberg Law reported. The Small Business Reorganization Act of 2019, signed into law in August, adds a subchapter to the bankruptcy code’s chapter 11 to cut the legal costs incurred by qualifying small corporate debtors, defined as those with about $2.7 million of debt or less. It also expedites the restructuring process and allows owners of the bankrupt company to retain a stake.“The SBRA represents an innovative effort to expedite and reduce the cost of bankruptcy for small business debtors to reorganize their debts and save their businesses,” said USTP Director Cliff White. “The USTP has spent the past six months preparing for its implementation and is committed to ensuring that the law is carried out as intended.” In addition to the selection of the new subchapter V trustees, the USTP developed a comprehensive manual and handbook to guide staff and subchapter V trustees in carrying out their new SBRA responsibilities; provided extensive training to staff, subchapter V trustees, bankruptcy professionals, and others interested in the new law; and coordinated with the bankruptcy courts on administrative issues to ensure a successful implementation. Click here to read the USTP's press release.
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