Will the UK become the centre of bankruptcy tourism?
While the term bankruptcy tourist is something which the vast majority of us will have never come across before, it is a term which is becoming more commonplace in the UK. It is well known that because of the EU structure, all EU citizens are able to move around the European Union with relative freedom and take advantage of local laws and regulations. As a consequence, there is a growing fear that more and more effectively bankrupt non-UK citizens (i.e. from other European countries) are set to flood the UK.
In the year to March 2009 it was revealed that 59 foreigners actually filed for bankruptcy in the UK in relation to debts held overseas. All of the people in question had lived in the UK for less than 12 months after obtaining a temporary address in the country. It is possible, under certain circumstances, for those made bankrupt in the UK to have their debts written off after just one year no matter which country of the European Union their debts originate from. This compares very favourably to Germany which has a 7 year wait and Ireland which has a 12 year wait before debts can be written off.
Despite the genuine underlying reasons for members of the European Union becoming more entwined, it seems that many people are set to use foreign regulations and foreign laws to their benefit and the detriment of third parties.
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