New system for filing MtGox claims set to be released in August

Maria Nikolova

After the bankruptcy proceedings related to MtGox were stayed, the civil rehabilitation proceedings come with the requirement for a new system for filing claims.

regtech

Nobuaki Kobayashi, Civil Rehabilitation Trustee for notorious Bitcoin exchange MtGox has provided an update about the timing for filing proofs of rehabilitation claim.

“We are currently using our best efforts to build the system for filing proofs of rehabilitation claim. We plan to release such system this August”, he said.

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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