Rhode Island Senate Bill S2093

Rhode Island 2022 Regular Session

• Introduced: 1/25/22
• Refer: 1/25/22
• Report Pass: 5/12/22
• Engrossed: 5/19/22
• Refer: 5/20/22
• Report Pass: 6/9/22
• Enrolled: 6/14/22
• Passed: 6/20/22

Caption

Procedure In Particular Actions -- Rhode Island Commercial Receivership Act

Impact

The passage of S2093 is likely to impact statutes concerning the appointment and authority of receivers in Rhode Island. It empowers the court to appoint receivers to protect financially distressed businesses and enables the receivers to operate and manage receivership property. The legislation aims to promote economic stability by helping businesses navigate challenging circumstances without immediate liquidation, thus preserving jobs and economic activity within the state.

Summary

Bill S2093, titled the 'Rhode Island Commercial Receivership Act', introduces a new framework for handling commercial receiverships in Rhode Island. The bill allows for the establishment of temporary non-liquidating receiverships, permitting businesses experiencing sudden revenue declines due to emergencies to remain operational while managing their debts under court supervision. The act significantly modifies existing procedures, emphasizing a structured approach that enables receivers to manage properties and debts effectively, safeguarding creditors' rights while providing debtors with necessary protections.

Contention

While proponents argue that S2093 provides essential support for businesses in crisis, potential points of contention include concerns over the extent of creditors' rights and protections afforded to debtors. Critics may raise issues regarding the transparency of the receivership process and the potential for misuse of the receiver's powers, necessitating careful judicial oversight. The effectiveness of the bill in achieving its intended goals will rely on its implementation and the flexibility allowed to both debtors and receivers during economic downturns.