Bankruptcy, Reorganisation and Insolvency
Payment difficulties may affect both companies and natural persons. Bankruptcy is not always the only solution, because a viable company may be able to undergo reorganisation and, in certain circumstances, the debts of a natural person can be restructured.
In the event of insolvency, it is important to assess quickly whether the difficulties are temporary or permanent. Reorganisation gives a viable company the opportunity to restructure its debts and continue its activities, while bankruptcy proceedings are intended for situations where creditors’ claims are satisfied out of the debtor’s assets in the procedure prescribed by law. A wrong or delayed decision may increase damage and lead to personal liability of a member of the management board.
For a creditor, it is important to submit and protect their claim on time. In bankruptcy proceedings, disputes may concern recognition of claims, liability of a member of the management board, the actions of the trustee in bankruptcy or recovery of transactions. Law Firm Namm prepares petitions and applications related to bankruptcy and reorganisation and advises members of the management board in cases of payment difficulties. We work in Estonian, Russian and English.
What services we offer in bankruptcy, reorganisation and insolvency
- Assessment of insolvency and advice
- Preparation and filing of a bankruptcy petition
- Representation of the debtor in bankruptcy proceedings
- Representation of the creditor in bankruptcy proceedings
- Submission and defence of claims in bankruptcy proceedings
- Reorganisation and preparation of a reorganisation petition
- Debt restructuring for natural persons
- Liability of a member of the management board in the event of insolvency
- Recovery claims and defence against them
- Disputes in bankruptcy proceedings
- Disputes with a trustee in bankruptcy
- Termination and liquidation of a company
- Negotiations with creditors and debtors
- Representation in litigation related to insolvency
Frequently Asked Questions
A company has payment difficulties. Should it choose reorganisation or bankruptcy?
This depends on whether the company has a real possibility of continuing its activities. If the difficulties are temporary and the company is viable, reorganisation may be suitable. If obligations cannot be performed and recovery is not realistic, bankruptcy proceedings may be necessary. It is important to assess the situation before debts and liability risks increase.
What is reorganisation and who is it suitable for?
Reorganisation is a procedure aimed at helping a company in payment difficulties avoid bankruptcy and continue its activities. For this purpose, a reorganisation plan is prepared, which may for example change payment terms, reduce obligations or reorganise the company’s activities. Reorganisation is suitable for a company that has a real prospect of overcoming the difficulties.
When must a member of the management board file a bankruptcy petition?
If a company is permanently insolvent, the management board must act without delay and file a bankruptcy petition where necessary. Delay in filing a bankruptcy petition may harm creditors and lead to personal liability for a member of the management board. Selective payments or transactions that worsen the position of other creditors must also be avoided.
I am a creditor and the debtor has become bankrupt. What can I do?
The creditor must submit their claim in bankruptcy proceedings on time and in the proper form. Documents proving the existence and amount of the claim must be enclosed with the claim. Delay or insufficient evidence may reduce the chance of receiving money back from the bankruptcy estate.
What is recovery of transactions in bankruptcy proceedings?
Recovery of transactions means that, under certain conditions, the trustee in bankruptcy can challenge transactions made before bankruptcy that harmed creditors. This may include, for example, selling assets below market value, unusual payments or transactions with related parties. Recovered assets or their value belong to the bankruptcy estate.