moratorium

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moratorium

a legally authorized postponement of the fulfilment of an obligation

Moratorium

 

a postponement of obligations established by a government for a fixed period or until the end of certain forces majeures, for example, during war or natural disaster. A general moratorium applies to all obligations; other types pertain to only certain varieties of obligation or to certain categories of debtors.

In the USSR a moratorium may be established by a decree of the Council of Ministers of the USSR or of a Union republic. Soviet civil law considers a moratorium grounds for suspending the period of limitation on civil suits (Civil Code of the RSFSR, art. 85). A general moratorium has never been declared in the USSR; during the Great Patriotic War of 1941–45, a moratorium was declared on certain obligations only.

In capitalist countries, the government resorts to moratoriums during periods of economic crisis. As a rule, such moratoriums apply to bank transactions on foreign loans. A special form of moratorium is the bank moratorium, which closes credit institutions for a certain time by order of the government. Use of the moratorium is characteristic of the present-day currency and financial crisis. For example, the devaluation of the American dollar in 1971–73 led to numerous closings of the major currency exchanges in Western Europe and Japan.

References in periodicals archive ?
Foreclosure moratoria generally applied to both farm and nonfarm residential mortgages.
Alston (1984) investigates why some, but not all, states imposed foreclosure moratoria during the Depression.
As noted previously, moratoria were adopted in a few states with relatively low farm foreclosure rates, and some states with high farm foreclosure rates did not impose moratoria.
Some evidence on why states imposed foreclosure moratoria is reported in Table 2, which presents a replication of Alston's (1984) logit model and some alternative specifications.
Presumably, the demand for moratoria legislation was greater where a high percentage of homes were mortgaged and, hence, at risk of foreclosure.
Stated differently, for a given rate of farm foreclosures, states in the Northeast were more likely to adopt foreclosure moratoria than states elsewhere.
Model 3 further refines the analysis by testing whether the influence of farm foreclosures on moratoria adoption was stronger in states with relatively high farm populations.
The coefficients on the regional dummies are again negative, suggesting a relatively low demand for moratoria among states outside the Northeast.