17 ALB CHINA INSOLVENCY & RESTRUCTURING GUIDE 2023 posted as security. Therefore, proceeds from disposal of the property posted as security shall be used to satisfy claims secured by property only after deduction of the advanced expenses and debts of common interest. The second category shall be bankruptcy expenses and debts of common interest arising from unsecured property, which shall be paid off from the unsecured property, or may be covered by the balance, if any, of the property posted as security that may remain after satisfaction of claims secured by property. The third category includes all expenses other than those in the first and the second category, for instance, court costs of bankruptcy cases, which under current laws may only be paid from unsecured property or from the remaining part of the property posted as security. Second, the creditor shall determine whether the payment sequence and the sources of funding are compliant with laws through considering the causes of bankruptcy expenses and debts of common interest, and shall promptly seek remedies if discovering any practice that damages its rights and interests. Third, if the administrator has paid reasonable efforts for maintenance, sale, delivery and otherwise management of the property posted as security, it shall, through consultation with the security interest holder, determine to receive a reasonable amount of remuneration. The creditor shall examine the administrator’s remuneration calculation and consult with the administrator on the issue. It needs to be noted that, given that reality is far more complex than what is discussed herein, there might be difficult situations that cannot be addressed using the above rules, and creditors shall make comprehensive judgment depending on the circumstances to protect their legitimate rights and interests.
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