Insolvency

If the continuity of your company’s activities is threatened, either immediately or in the long term, your company faces the risk of “imminent insolvency”. Avoid a bankruptcy. We can assist in the reorganisation of a company in difficulty. Together, we can ensure that your company is protected from its creditors and try to guarantee its survival. This is in the interests of everyone, the individuals, the company and its creditors.

We specialise in the judicial reorganisation of companies in difficulty, colloquially often abbreviated to WCO or GREO. Our extensive team of specialists with many years of legal expertise in this field can be entirely at the disposal of a company in difficulty. We keep our expertise up to date by continuously investing in knowledge management.

We use legal instruments to reorganise the company so that it can continue to exist. In this way, we save the work of the operator, which is also in the interest of the creditors, who are often left empty-handed in the event of winding-up.

Legislation has long provided for an extensive package of legal instruments available to companies whose continuity is threatened. There is a wide range of possibilities that allow companies to map out a tailor-made reorganisation process based on their specific characteristics.

Investigation by the Chamber for Companies in Difficulty at the request of the debtor

In the event of imminent insolvency, the company may ask the Chamber for Companies in Difficulty to summon creditors to conclude a settlement with those creditors and have it recorded by the Chamber for Companies in Difficulty.

Company mediation

At the request of the debtor, the Chamber for companies in difficulty may appoint a restructuring expert for companies in difficulty in order to facilitate the recovery of the company. A restructuring expert is a legal representative appointed by the insolvency court to perform one or more of the following tasks:

  • assist the debtor or creditors in drawing up or negotiating a reorganisation plan;
  • supervise the debtor’s activities during the negotiation of a reorganisation plan, and report to a court or tribunal;
  • exercise partial control over the debtor’s assets or affairs without dispossession, before or during the negotiation of a judicial reorganisation.

In addition, there are also the so-called “insolvency procedures”, namely the procedure of amicable settlement without judicial reorganisation, the procedure of public or closed judicial reorganisation, the procedure of transfer under judicial supervision, the procedure of closed preparation of bankruptcy or the bankruptcy procedure.

Amicable settlement

The purpose of the amicable settlement procedure is to conclude an arrangement between the debtor and one or more of its creditors with a view to restoring the financial situation or reorganising the company. Sometimes, a reorganisation to remedy the difficulties involves no more than concluding a good and balanced agreement with a few creditors.The parties are free to determine the content of this settlement, which is not binding on third parties. The debtor or one of the parties to the settlement may request that the amicable settlement be approved by the court and, if necessary, that it be enforced in respect of all or part of the claims referred to therein.

Public judicial reorganisation

Sometimes the difficulties cannot be solved by concluding agreements with only a few creditors. In that situation, it is better to involve all creditors in the reorganisation and to ask for a period of protection (“suspension”). During this procedure, creditors’ rights are “suspended”. During the period of the suspension, no means of enforcement may be continued or used in respect of claims subject to the suspension in respect of the debtor’s movable or immovable property. During the same period, the debtor cannot be declared bankrupt except on declaration by the debtor itself and, if the debtor is a legal entity, it cannot be dissolved by court. In this way, the company is protected and given time to reorganise itself through the most effective judicial procedure.

Public judicial reorganisation by means of an amicable settlement

Where the purpose of the judicial reorganisation procedure is to conclude one or more amicable settlements, the debtor pursues this objective under the supervision of the delegated judge and, where appropriate, with the assistance of the appointed restructuring expert. If an amicable settlement is reached, the court will approve this agreement of the appointed restructuring expert. If an amicable agreement is reached, the court homologates it

Public judicial reorganisation by means of a collective agreement applicable to small and medium-sized companies

During the suspension, the debtor draws up a reorganisation plan that must be voted on by the creditors and which, in the event that it meets with the approval of the majority of the creditors, must still be approved by the court.

Public judicial reorganisation by means of a collective agreement applicable to large companies

This is one of the insolvency procedures that is only applicable to companies, associations or foundations that exceed one or more of the following criteria during two consecutive financial years:

  • annual average number of employees: 250;
  • annual turnover excluding value added tax: 40,000,000 euros;
  • balance sheet total: 20,000,000 euros.

Closed judicial reorganisation procedure

At the request of the debtor, the president of the business court can appoint a restructuring expert with a view to reaching an amicable settlement or drawing up a reorganisation plan. The procedure is closed and the decisions are not published.

  • Closed judicial reorganisation by means of an amicable settlement
  • Closed judicial reorganisation by means of a collective settlement

Transfer under judicial supervision

Sometimes the difficulties faced by companies are too great and can no longer be fully resolved. In such a case, it is still possible to remove all or part of the company or certain assets from the company in difficulty and to effect a transfer to a new entity.

Closed preparation for bankruptcy

A debtor, which considers itself to be bankrupt, may apply to the court, which would have jurisdiction under this law, to seek a declaration of bankruptcy and request that preparations be made prior to the declaration of bankruptcy for the transfer of all or part of its assets and activities. In this way, the healthy parts are saved from bankruptcy and what is valuable is preserved.

Bankruptcy

Temporary difficulties can become structural and even lead to the end of the company. As an operator, it is very important that you can correctly assess what a bankruptcy of your company in difficulty means exactly.

Our team of experienced specialists in insolvency law and judicial reorganisations can assist you with advice and taking action. After all, our motto is: “There is always a solution, no matter how unlikely it may sound”.

Lawyers within this expertise

Steffi Vanhulle

Counsel