The National Association of Credit Management (NACM) commends U.S. senators Chuck Grassley, R-IA, Orrin Hatch, R-UT, Jeff Sessions, R-AL, John Thune, R-SD, Thomas Carper, D-DE, Ben Nelson, R-NE, Richard Shelby, R-AL and Michael Enzi, R-WY, for introducing and sponsoring Senate Bill 256, known as the “Bankruptcy Abuse Prevention and Consumer Protection Act of 2005.”
Commercial bankruptcy reform is urgently needed to provide relief to businesses nationwide.
As the largest organization of unsecured trade credit grantors in the world, NACM is vitally concerned about the effects that commercial bankruptcy law and practices have on the U.S. economy. To this end, NACM has fought for commercial bankruptcy reform laws that accurately reflect the needed balance between creditors and debtors.
Robin Schauseil, CAE, President of NACM is concerned that the abuses related to preference payments and other problematic provisions in the bankruptcy code are having a serious and damaging impact on American businesses, especially small businesses. It has become increasingly clear that the severe problems caused by commercial filings are reshaping business credit policy. "This can be a dangerous situation since business credit is the single largest source of business financing in the United States. Commercial bankruptcy reform is especially critical for small businesses - a sector of the economy that the government is looking to for growth, export and new jobs," Schauseil said.
NACM applauds Sen. Grassley and the other Senate sponsors for their long time support of commercial bankruptcy reform. As it has with past bankruptcy reform bills, NACM advocates that any bankruptcy reform legislation specifically address three areas of credit law reform to help strengthen the financial posture of small business. They are: the creation of an expedited procedure for small businesses in Chapter 11; enacting revisions in the treatment of preference challenges to creditors; and implementing reclamation reform.
By enacting these changes contained in the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005, NACM contends that the financial vitality of businesses, especially small businesses, will be enhanced. Such improvements to federal bankruptcy law, as they relate to businesses, will not only help to promote President George Bush’s commitment to small businesses, as outlined in his State of the Union Address Feb. 2, but also will improve the overall prospects for economic growth in the U.S. economy. NACM endorses the pledge the President made in his State of the Union Address to “free small businesses from needless regulation.”
Submitted by National Association of Credit Management (NACM)