The China Post news staff
Community mediation committees will be empowered to mediate debt clearance issues between creditor banks and consumers if draft amendments to the country’s regulations governing the clearance of consumer debts are approved by the Legislature.
The purpose of the amendments proposed by Hsieh Kuo-liang (謝國樑), a lawmaker from the ruling Kuomintang, is to encourage the use of the country’s debt relief programs by consumers who could use a breather and enable the law courts to approve recourse to such programs more frequently.
In the future, debtors seeking debt relief can directly talk to their banks or seek mediation by community mediation committees. Should they have difficult repaying their debts, they can apply to law courts for liquidation or even debt forgiveness.
Liquidation processes may also still be initiated if the reduced outstanding debts are still considered unaffordable by the debtors even after mediation, but such processes will be called off and debts will not be forgiven if the debtors are caught indulging themselves in luxuries in the first two years of the processes.
Debt relief programs and liquidation processes have gotten many people off the hook since the passage of the consumer debts clearance regulations, Hsieh said. According to Judicial Yuan statistics, more and more people are applying for eligibility for debt relief and liquidation, Hsieh said, adding more than 1,000 cases of debt relief and liquidation ran their courses last year.
To help more debt-ridden people, we are trying to get the law courts to approve more applications for eligibility for debt relief and liquidation by proposing the amendments, he explained.
In the past, most debt relief programs were negotiated between debtors and creditors. Under the new amendments, a third party playing the role of a mediator will be involved.