Special grounds for declaring debtor transactions invalid in bankruptcy proceedings: theory and case law

Abstract

The article analyzes the special grounds for declaring a debtor’s transactions invalid in bankruptcy proceedings. The author examines the legal nature of transactions in the field of bankruptcy, their impact on property relations between the debtor and creditors, as well as the peculiarities of their application in judicial practice. The article reveals the content and specific features of the six special grounds provided for in paragraph 2 of Article 7 of the Law of the Republic of Kazakhstan dated March 7, 2014, No. 176-V “On Rehabilitation and Bankruptcy” (hereinafter – the Bankruptcy Law). Particular attention is given to the legal consequences of unequal consideration, violation of statutory authority, gratuitous or undervalued transfer of property, preferential payments, and sham transactions, illustrated through specific court cases. 
The author provides a detailed analysis of the distribution of the burden of proof in judicial practice, the use of valuation reports, and the determination of market conformity of transaction prices. The article also examines the litigation strategies of bankruptcy administrators and the courts’ approaches to evaluating evidence. The paper highlights the legal significance of the institution of declaring debtor transactions invalid, emphasizing its role in protecting creditors’ interests and ensuring fairness within bankruptcy
proceedings. As a result of the study, the interrelations and distinctions among the special grounds applied in bankruptcy disputes are systematized, and the need to improve judicial practice is identified.