Beyond Personal Bankruptcy: Can Debt Forgiveness Enable Entrepreneurs to Start Over

Corporate Bankruptcy Law is often regarded as the “Constitution” of a market economy. As discussions on amending bankruptcy law continue to advance, the personal bankruptcy system has gradually become a hot topic in the fields of law and economic policy. Many believe that introducing a personal bankruptcy system can give “honest but unfortunate” debtors a chance to start over, thereby encouraging entrepreneurs to re-enter the market after failure and further unleash economic vitality. However, from practical observation, entrepreneurs show some concern but little enthusiasm for the personal bankruptcy system. Legislation and academic discussions may be somewhat disconnected from the market, creating a “flowering inside the walls, fragrant inside the walls” situation. In pilot programs for personal bankruptcy in places like Shenzhen, the main beneficiaries are not the large or medium-sized enterprises or popular sectors often discussed in public opinion, but small and micro business owners, individual entrepreneurs, and ordinary individuals trapped by consumer loans and credit card debt.

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