Substantive Combined Bankruptcy of Individuals and Enterprises: Breakthrough in Judicial Practice and Path of System Construction

The systematic study of the consolidated bankruptcy system of individuals and enterprises is carried out in four aspects, namely, the current practice, feasibil-ity, application standard and system construction. In judicial practice, some cases only include specific personal property in the bankruptcy estate or require personal consent for consolidation, while the first consolidated bankruptcy case in Kunshan in 2021 breaks through the restriction and includes all personal property in the program through "reverse personality denial". Although the fo-cus of personal and enterprise bankruptcy systems is different, the ultimate goal is to unify the fair liquidation and maintenance of market order. Substantive consolidation rules integrate assets and liabilities in the procedure, and at the same time solve the problem of the specificity of personal property through the mechanism of property exclusion, exemption and etc. The applicable standard needs to be based on the mixing of subjects. The application standard should be centered on the substance and continuity of the subject mixed together, com-bined with the difficulty of separating assets, fraud, creditor interests and other auxiliary factors to make a comprehensive judgment. In terms of system con-struction, the bankruptcy estate adopts expansionism, clarifies the scope of personal exemptions, establishes the principle of multiple application subjects and jurisdiction of the enterprise's domicile in terms of procedure, and safe-guards the right of creditors to object through the mechanism of "hearing - re-consideration - litigation", which provides a comprehensive solution to the problem of unfairness in liquidation caused by mixing of properties. It provides a comprehensive path to solve the unfairness of liquidation caused by property mixing.