The entrepreneur (sole proprietorship, commercial partnership, private limited company and public limited company) plagued by a great deal of debt, which put the continuity of the company at risk may choose to file for bankruptcy of his company; he may also opt to bring about debt rescheduling with his creditors.
The insolvency of the company has major consequences. The entrepreneur will lose the control and disposition of his capital and the liquidator may even seize his private capital to pay out debts. In the majority of cases, discharge of the liquidation is given without the creditors receiving their amount due. After the liquidation is completed these creditors may yet again turn to the debtor in order to enforce payment of their claim; a scenario which is not very appealing to an entrepreneur because this way he will never be released from his debts.
A less far-reaching and at the same time more effective way to settle the debts is to enter into a debt rescheduling scheme with the creditors. In that case the entrepreneur will come to an amicable (private) settlement with all (ordinary and preferential) creditors. This amicable settlement entails that against payment of a minor percentage of the claim, the creditor will waive further payment of the remainder of the claim. In this scenario the creditor will still have part of his claim paid back, while experience shows that in case a liquidation is ordered, the creditors will hardly see any of their claims settled, if at all.
In principle not only the legislator but the court also offers an increasing number of possibilities to reschedule their debts extrajudicially. It is clear from case law, among other things, that when the majority of creditors agrees to debt rescheduling, one single reluctant creditor will not be allowed to be obstructive. Under circumstances this reluctant creditor may even be forced by the court to cooperate with the debt rescheduling, whether he agrees with this or not.
Once the debt rescheduling has been carried out the entrepreneur may continue his enterprising activities without the burden of a sky-high debt. On top of this, the entrepreneur will remain in charge of his own company and he will not be required to turnover control and disposition thereof to the liquidator.
This website provides the opportunity to ask questions in a specific situation about the feasibility of possible debt rescheduling, the working method and obviously within which term such debt rescheduling can be executed. As we have extensive experience in this field, a quick scan will enable us to establish a first diagnosis about the feasibility of debt rescheduling within 24 hours.
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