Insolvency – the perfect recipe for embezzling public property managed by state-owned companies

At least 56 state-owned companies are in insolvency or liquidation, including a quarter of the 126 state enterprises founded by the Public Property Agency and a third of the 77 majority state-owned joint-stock companies. The procedure removes state-appointed management, while insolvency administrators may run an unlimited number of firms with minimal qualification requirements. Corporate governance rules are suspended, and the process is opaque and barely digitalised. The state often has no debtor's representative, and the Ministry of Finance, if a creditor, holds only one vote. Public-domain assets that are not yet delimited may enter the insolvency estate, and the founder's subsidiary liability conflicts with Law No. 845/1992.

The commentary recommends planning market exit, finishing the delimitation of assets, strengthening the Agency, appointing debtor's representatives, shortening proceedings, increasing transparency, digitalising records and abolishing subsidiary liability.