Artur Zurabyan commented in an article for the Lawyers’ Gazette titled “The Supreme Court: The recognition of a credit institution as bankrupt does not negate bank secrecy”

The court explained how to maintain a balance between the information rights of the creditors of a bankrupt bank and the rights of the bank’s clients to bank secrecy.

One of the experts in the Lawyers’ Newspaper noted that, although the Supreme Court had established the general principle of limiting bank secrecy, in favor of proper judicial control over the activities of the trustee, it placed a number of essential conditions on the right of the creditor to receive such information on the register of claims. Another view was that those conditions were too broad and that, in practice, it would take time to develop clearer criteria.

On 13 December of last year, the Supreme Court of the Russian Federation considered a dispute between a bankrupt bank creditor and a bankruptcy trustee of a debtor concerning the latter’s need to provide information for registering the creditors’ claims.

By Order No. 305-EC18-5703, the Supreme Court of the Russian Federation overturned the judicial acts of the courts of lower instances and referred the stand-alone dispute to the court of first instance for reconsideration.

Artur Zurabyan, the head of the dispute resolution and international arbitration practice at ART DE LEX, noted that the Supreme Court ruling touches upon very subtle matters: “On the one hand, there is the right of the creditors to information and proper judicial control over the activities of the trustee in insolvency, and on the other hand, the bank’s depositors have a right to ensure their bank secrecy and the non-disclosure of personal data.”

In his opinion, it is in this regard that the Supreme Court, although it has established the general principle of limiting bank secrecy, in favor of proper judicial control over the activities of the trustee, placed a number of essential conditions on the implementation of the right of the lender to receive such information. “In addition to the formal 1 percent in the register, the creditor must prove that there are solid grounds to doubt the validity of the trustee’s actions. It is unlikely that exercising this right of the creditors of bankrupt banks will become a widespread practice because it will be necessary to convince the court, in each a case, of the validity and good faith of the creditors,” Artur Zurabyan maintained.

Read the full version of the article at https://www.advgazeta.ru/novosti/vs-priznanie-kreditnoy-organizatsii-bankrotom-ne-ustranyaet-rezhima-bankovskoy-tayny/.