A total of 443 petitions were filed at the U.S. Bankruptcy Court in Puerto Rico during the month of September, representing a 31.1% drop from the same month in 2019, according to a report released by research firm Boletín de Puerto Rico.
In September 2019, the court received 629 bankruptcy cases, according to the report.
From January to September, a total of 3,923 cases were filed, which also represents a 31.1% drop from the same period in 2019, when 5,690 bankruptcy petitions were submitted for consideration.
Data compiled by Boletín de Puerto Rico shows that the majority of the cases filed from January to September were submitted under the Chapter 13 category, which gives individuals the chance to reorganize their finances. A total of 2,149 petitions were filed under this category, representing 37.8% fewer cases than the 3,457 cases on record for the same period in 2019.
Coming in second were 1,747 Chapter 7 cases seeking total liquidation submitted during the nine-month period. That total represents a 19.1% year-over-year drop when compared to the 2,160 cases filed during the same period, Boletín de Puerto Rico confirmed.
“Chapter 7 in the bankruptcy code allows individuals, corporations, or self-owned businesses to settle their debts. Simply put, it means total bankruptcy,” Boletín de Puerto Rico explained.
“The bankruptcy court designates a trustee who is responsible for liquidating the assets so that the debtor obtains a debt discharge,” the firm said, adding that it reports percentage data comparing the total bankruptcies filed against Chapters 7 filings in response to concerns from its own clients.
There were 25 Chapter 11 filings on record through September from businesses that are seeking to reorganize their finances through this type of protection. The figure is 60.3% lower than the 63 petitions on record for the same nine-month period in 2019.
Meanwhile, two farming operations filed for Chapter 12 protection — a category that is reserved exclusively for troubled agriculture businesses — during the January-September period.
Finally, Boletín de Puerto Rico also revealed a weekly breakdown of the filings, starting on Mar. 16, when Gov. Wanda Vázquez declared a quarantine to prevent the spread of the COVID-19 virus. The report shows that the majority of the petitions were filed from April 13 to May 31.