Legal and economic analysis of the Avoidance of Pre-Bankruptcy Transactions

Most legal systems to protect the property of a bankrupt merchant and creditors provide several mechanisms to reverse transactions entered into by a debtor prior to the commencement of the bankruptcy procedure. Analysis of the legal and economic logic governing the invalidity of such transactions shows that in the Iranian legal system there are shortcomings such as no time limit regarding the length of twilight periods, the scope of avoidable transactions, the provision of remedies and the necessary conditions for the avoidance of perfectly valid transactions. Regarding the above shortcomings, it was suggested that a specific length of twilight periods (6 months to 2 years, as the case may be) be provided in the law And the criterion for insolvency should be permanent and incurable cessation, not the oldest cessation. from the date of cessation of the company The principle is the correctness of transactions and the invalidity is considered an exceptional matter, Use the Unenforceability (Inopposabilité) guarantee instead of the nullity guarantee And the effect of some requirements such as good / bad faith of persons in the invalidity of transactions due to its negative economic effects should be limited to specific cases.