Garnishment Limit in Natural Person Insolvency: What does Decision 13/2026 entail?

By Decision no. 13 of the Central Level Insolvency Commission regarding the approval of the General Criteria for establishing a reasonable standard of living, published in Official Gazette no. 279 of April 7, 2026, the minimum monthly amounts that a natural person in insolvency proceedings can keep for expenses are established, thus defining the income protected from creditors.

What does it stipulate?

The Decision introduces a calculation mechanism for the “reasonable standard of living”, which represents, in commercial terms, the amount of money from the debtor’s income that cannot be used for debt payment. This threshold is established based on a “minimum monthly consumption basket” and functions as a limit on the amounts that can be distributed to creditors. Any repayment plan proposed within the insolvency proceedings must ensure the debtor at least these amounts for daily living.

The minimum amounts guaranteed to the debtor in insolvency proceedings based on a repayment plan are fixed and differentiated. For an urban debtor, the protected amount is 1,300 lei for each adult, 957 lei for each child over 14 years old, and 683 lei for each child under 14 years old. In rural areas, the values are lower: 1,049 lei for an adult, 771 lei for a child over 14 years old, and 552 lei for a child under 14 years old. A special rule applies in asset liquidation proceedings, where the minimum protected amount for the debtor is the equivalent of the gross minimum wage in the economy, to which amounts for dependents are added.

The minimum thresholds can be significantly increased by adding supplementary expenses, justified by the debtor’s particular needs. The Decision allows the addition to the minimum basket of costs such as: housing expenses (utilities, rents) that exceed the standard, special dietary needs (medical diets), transport costs to work or school, unforeseen medical expenses, schooling costs, or expenses necessary for the maintenance of a vehicle indispensable to the family. These additions directly reduce the amount available for covering claims.

An important aspect concerns the right to housing. The debtor and their family have the right to “suitable housing”, according to the standards of the Housing Law. If the personal property is sold within the proceedings, the cost of rent for new suitable housing is added to the protected monthly expenses. This provision can substantially affect the degree of debt coverage, especially in the case of debtors who own valuable properties, but who will require a consistent monthly budget for rent post-execution.

To whom does it apply?

The criteria apply to any company that holds the status of creditor in a natural person insolvency proceeding, according to Law no. 151/2015. Directly targeted are:

• Credit institutions (banks) and non-banking financial institutions (NBFIs).
• Utility providers (energy, gas, water, sanitation).
• Telecommunications companies.
• Debt collection companies.
• Any other commercial entity that has debts to recover from natural person clients.
• Any natural person or legal entity holding a claim right against the debtor’s assets.

What should you do?

• Evaluate the portfolio of claims from natural persons to adjust provisions and recovery rate estimates, taking into account these new protected minimum thresholds.
• Analyze in detail, through lawyers, the supplementary expenses invoked by debtors within insolvency proceedings, to contest unjustified costs that diminish the creditor mass.
• Review internal amicable collection procedures and payment plan negotiations, as these criteria offer debtors a new negotiation tool and a clear reference regarding the minimum amount they can retain monthly.

Source: Official Gazette, Part I, no. 279 of April 7, 2026.

Note: This material is strictly for informational purposes and does not constitute legal, tax, or business advice. Since the interpretation and application of legal provisions can vary significantly depending on the specific circumstances of each entity, we recommend seeking specialized legal assistance before adopting any operational decisions based on these changes.