1E9Ct5D

6. Specific Protections of Creditors’ RightsThe Business Reorganization Law establishes two institutions for the protection of creditors’rights against acts attributable to the merchant. These institutions aim at removingassets from the reorganization process or stall the progress of the reorganization.On the one hand, there are different types of acts that are considered to be carried outto defraud creditors and are considered null and void. The following acts are consideredacts to defraud creditors:a) Any act or contract executed before the business reorganization judgment throughwhich a creditor is defrauded and as long as a third party knows of the merchant’sfraud. This last requirement is not necessary in acts of charity, such as a donation;b) Acts such as pardoning of debt by the merchant, the payment of debts not pastdue, or operations not carried out under market conditions when carried out as ofthe date the bankruptcy is made retroactively effective. The date of retroaction isthe 270 th calendar day immediately prior to the date of the judgment declaring thebusiness reorganization.Furthermore, a merchant may be considered to have committed a crime for engagingin acts to defraud or harm his creditors and that result in aggravating the general defaultor stall the reorganization process.327Insolvency and Bankruptcy