Application of Certain Legal Mechanisms for the Purposes of Preventing Bankruptcy of Property Developers

Taking into account the discovered statistics, property developers are ‘leaders’ among debtors turning to bankruptcy proceedings. This article is aimed at finding and analysing information on the reasons for such a state, measures taken to overcome the crisis phenomena and proposing the author’s ideas on the topic of resolving the identified problems. Taking into account the study of foreign legislation, as well as the latest regulatory changes on this issue, the conclusion is proposed that it is necessary to use certain legal mechanisms to prevent bankruptcy of the developer. Such measures may include: conclusion of an insurance contract, inadmissibility of unilateral cancellation of the contract, crediting on favorable terms, admissibility of performance of obligations by a third party, and so on. In addition, the interconnection of construction relations with other spheres of social life is emphasized, as a result of which the applicable regulation should apply not only to developers themselves, but also to persons related to them — construction participants, banking and credit organizations, insurance organizations, etc. In other words, support should be provided to developers, as well as to the construction industry. In other words, support should be provided to each ‘link’ of such a system. The article also states that all legal instruments of assistance should be applied before the introduction of judicial bankruptcy proceedings, because in the framework of the bankruptcy process the effectiveness of the latter is significantly reduced.