Insolvency & commercial criminal law
“Insolvency is usually foreseeable over a longer period of time, but suddenly the day arrives when a company or a private individual is no longer able to meet their obligations. The situation is often accompanied by a feeling of failure, which presents a great challenge to the people involved. We advise you in this difficult situation and support you with competence and experience.”

Insolvency & commercial criminal law

Insolvency law, commercial criminal law and financial criminal law overlap in many legal respects. Our experts at TWP are always up to date in these areas and support our clients competently through difficult times. Legal advice is often advisable even before the company actually runs the risk of slipping into insolvency. The provisions of the Insolvency Code, the Equity Replacement Act and the criminal code oblige entrepreneurs to continuously analyse their economic situation. If the company is no longer solvent, insolvency or restructuring proceedings must be initiated. Directors and officers may incur personal liability for company debts in the event of a delayed response. We assist you with the filing and enforcement of insolvency claims and claims to assets in the insolvency proceedings. We represent both creditors and debtors, as well as shareholders and managing directors. If a bankruptcy is declared, we act as liquidators, undertake reorganisations with or without own management and ensure an orderly liquidation.

SPECIALIST AREA

Insolvency & commercial criminal law

PREPARATION FOR INSOLVENCY

We assist private individuals in debt settlement, payment plan or absorption proceedings, and also advise sole proprietors and partnerships in filing a timely insolvency application if they can no longer fulfil their payment obligations. Insolvency occurs when the entrepreneur is no longer able to pay due invoices or to raise the funds to pay them. If the company is operated in the form of a limited liability company (GmbH) or a stock corporation, it must be examined whether over-indebtedness is involved. We speak of over-indebtedness when the positive assets of the company are worth less than its liabilities. Insolvency proceedings are initiated at the request of the insolvent debtor or by the creditors. This application must be made within 60 days of the occurrence of the insolvency. We assist you in examining these issues and in preparing for insolvency.

 

HANDLING OF INSOLVENCY

Insolvency proceedings are based on the principle of distributing the debtor’s entire assets equally and proportionately among all creditors. When the insolvency proceedings are opened, the court appoints a liquidator, who is responsible for the company from that time on. The bankruptcy proceedings are made public and the creditors can file their claims from that date onwards. In a first step, the insolvency administrator assesses whether the company should be continued or closed. For this purpose, all fixed and current assets are analysed. In a next step, the insolvency administrator makes a declaration regarding the registered claims of the creditors. In insolvency proceedings, we assist the owner as well as the lessee and the lessor and advise creditors in contesting unjustified legal transactions (discrimination, preferential treatment, squandering of assets, contestation of gifts, incongruent cover, contestation of knowledge, return of deposits, etc.) We apply for a compulsory auction in good time or arrange for a private sale of assets.

CORPORATE RESTRUCTURING

With the reform of the insolvency law in 2010, bankruptcy and compensation proceedings were combined into a single insolvency procedure. In addition to bankruptcy proceedings, this procedure also offers the possibility of restructuring proceedings, which can be arranged with or without the entrepreneur’s own administration. If the debtor submits an application for restructuring, the creditors shall consult each other on its acceptance. The restructuring plan must be able to offer the creditors a quota of at least 30 percent, payable in no more than two years. If this is possible, the debtor can continue the business him/herself. Consequently, the bankruptcy proceedings are cancelled and the debtor can again dispose of his or her company. If the creditors do not agree to the restructuring plan, the bankruptcy proceedings continue. In the end, the company is closed and the creditors receive a quota.

 

LIQUIDATION MANAGEMENT

In judicial insolvency proceedings, the competent court usually appoints a lawyer as insolvency administrator. As liquidators, our lawyers take on the task of assessing the economic situation and ensuring the best possible handling of the proceedings through their profound legal knowledge. In this context, their main responsibility is towards the court and the creditors.