Former MtGox clients can now file rehabilitation claims

Maria Nikolova

The new system is available to clients of the ill-fated Bitcoin exchange worldwide.

In line with previous reports, the new system for filing MtGox claims has become available.

Nobuaki Kobayashi, Civil Rehabilitation Trustee for notorious Bitcoin exchange MtGox, has announced the start of the procedure of filing proofs of rehabilitation claim.

As with the bankruptcy proceedings, the Rehabilitation Trustee has built a system through which users of MTGOX’s Bitcoin exchange can file proofs of rehabilitation claim with respect to the claims for return of cryptocurrency and money against MTGOX. By using this online system, users around the world can easily participate in the Civil Rehabilitation Proceedings through filing proofs of Exchange-Related Rehabilitation Claim in accordance with the Civil Rehabilitation Act of Japan and other laws and ordinances.

The trustee encourages users to file proofs of Exchange-Related Rehabilitation Claim with the Online Method.

Of course, in addition to the Online Method, the Rehabilitation Trustee has prepared a form to file a proof of rehabilitation claim for Users who cannot use the Online Method. These users have to download the Proof of Rehabilitation Claim Form from the System, entering necessary inputs in it with their computer, and then send a printed version, to which they have to add their written signature or a name and seal, to the office of the Rehabilitation Trustee.

The dedicated page provides an online filing system that enables the users of the bitcoin exchange operated by MtGox Co., Ltd. to file a proof of rehabilitation claim electronically with respect to MTGOX’s civil rehabilitation proceedings.

Instructions here will differ for:

  • Users who filed a proof of bankruptcy claim online under the bankruptcy proceedings,
  • Users who did not file a proof of bankruptcy claim under the bankruptcy proceedings, and
  • Users who filed a proof of bankruptcy claim offline under the bankruptcy proceedings.

Let’s recall that some of the creditors of MtGox filed a petition for commencement of civil rehabilitation proceedings against the Exchange with the Tokyo District Court on November 24, 2017. The petition was heard on June 22, 2018, and the Tokyo District Court issued an order of the commencement of civil rehabilitation proceedings for MtGox. As a result, the previously ongoing bankruptcy proceedings were stayed. Due to the stay of the bankruptcy proceedings, MtGox bankruptcy claims filing system has been temporarily suspended.

Let’s note that there are certain differences between bankruptcy proceedings and civil rehabilitation proceedings. In bankruptcy proceedings, the power and authority to administer and dispose of the bankruptcy estate is given to a bankruptcy trustee. Conversely, in civil rehabilitation proceedings, the civil rehabilitation debtor retains the power and authority to administer and dispose of its assets.

However, even when it comes to civil rehabilitation proceedings, if an administrative order is issued by the court, and a civil rehabilitation trustee is appointed, the power and authority to administer and dispose of the civil rehabilitation debtor’s assets will be exclusively vested in the civil rehabilitation trustee. In civil rehabilitation proceedings concerning MtGox, the Tokyo District Court has issued an administrative order and has appointed Nobuaki Kobayashi as Civil Rehabilitation Trustee.

Another difference is that in bankruptcy proceedings, non-monetary claims are converted into monetary claims based on the valuation as at the time of the commencement of bankruptcy proceedings. In contrast, in civil rehabilitation proceedings, non-monetary claims are not converted into monetary claims at the time of commencement of the civil rehabilitation proceedings. Hence, in the civil rehabilitation proceedings in this matter, claims seeking a refund of Bitcoins will also not be converted into monetary claims after the commencement of the civil rehabilitation proceedings.

Furthermore, in bankruptcy proceedings, bankruptcy claims that have not been filed are not stated in the statement of approval or disapproval of claims. In contrast, in civil rehabilitation proceedings, the rehabilitation debtor, etc. will state the rehabilitation claims which the rehabilitation debtor, etc., is aware of in the statement of approval or disapproval of rehabilitation claims, notwithstanding that proof of claims have not been filed for them.

Finally, in civil rehabilitation proceedings, the rehabilitation debtor, etc., will prepare a rehabilitation plan, in which matters such as the content of any modifications of rights of civil rehabilitation creditors and the payment plan are set out. This type of plan does not exist under bankruptcy proceedings. The rehabilitation debtor, etc., is required to obtain the court’s confirming order via a rehabilitation creditors’ resolution on the proposed rehabilitation plan to make repayments in accordance with the rehabilitation plan. If the proposed rehabilitation plan is rejected or not otherwise approved, the civil rehabilitation proceedings in this matter will be discontinued and the bankruptcy proceedings will be recommenced.

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