We advise companies and their officers in a crisis, as well as creditors, suppliers and investors affected by the insolvency of a business partner.
Our clients include in particular
A corporate crisis affects both the company and its creditors. We most frequently advise each side in the following situations.
Incoming payments are slowing and credit lines are exhausted. Early action is decisive: a restructuring concept or the preventive framework under the StaRUG may still avert formal insolvency.
Illiquidity or over-indebtedness is becoming apparent. Filing deadlines under Section 15a InsO may already be running and the payment restrictions under Section 15b InsO become relevant. We preserve management’s ability to act and reduce personal liability risks.
A business partner files for insolvency. We register claims, protect retention-of-title and separation rights, and assess whether the supply relationship can continue and on what terms.
The insolvency administrator seeks repayment of amounts received in previous years. We test the requirements for clawback under Sections 129 et seq. InsO and defend against unfounded or excessive claims.
Businesses or individual assets can often be acquired from insolvency without assuming historic liabilities. We structure the transferring reorganisation or distressed M&A process on a legally robust and transaction-ready basis.
You want to avoid formal insolvency proceedings while implementing substantial measures. A restructuring plan under the StaRUG can bind dissenting creditors while management remains in office.
Payments made after insolvency has arisen, late filings or measures prejudicing creditors can trigger personal liability and criminal exposure. We advise preventively and defend management against claims.
Subsidiaries, suppliers or proceedings are spread across several countries. We coordinate cross-border proceedings through a network of local counsel, including COMI and secondary proceedings under the EU Insolvency Regulation.
Whether you act for the company concerned or need to protect your position as a creditor, we understand both perspectives and tailor the advice accordingly.
Restructuring and insolvency from the company perspective
Your company is under financial pressure.
Securing and enforcing claims
A business partner is insolvent or in crisis.
A restructuring requires a robust roadmap. We develop it with you and support implementation from the initial crisis analysis through stabilisation.
In a crisis, every day counts. We assess your situation in confidence and identify the next step that makes legal and commercial sense.
The stabilisation and restructuring framework under the StaRUG has been, since 2021, a stand-alone restructuring tool outside insolvency. It is available to companies facing imminent illiquidity, that is, before illiquidity or over-indebtedness has occurred. Its core is the restructuring plan, which, like an insolvency plan, adjusts claims and security, but can involve only selected creditor groups and can be confirmed even against dissenting creditors. Management remains in office. This allows a restructuring to be implemented quietly, without going through public insolvency proceedings.
Managing directors and board members of limited-liability entities must file for insolvency without undue delay in the event of illiquidity or over-indebtedness, at the latest three weeks after illiquidity and six weeks after over-indebtedness arise (Section 15a InsO). Missing the deadline exposes them to up to three years' imprisonment for delaying insolvency, as well as personal liability. The period is not a grace period: it may only be used while genuine restructuring efforts are under way.
Illiquidity (Section 17 InsO) exists where the company can no longer meet its due payment obligations; in practice a shortfall of at least ten per cent over more than three weeks is applied. Over-indebtedness (Section 19 InsO) exists where assets no longer cover liabilities and there is no positive going-concern forecast. Imminent illiquidity (Section 18 InsO) describes foreseeable future illiquidity and is the entry point to the StaRUG framework. The precise classification determines the filing duty and the restructuring options available.
In self-administration (Section 270 InsO), management continues to run the company during the insolvency proceedings under the supervision of a custodian, rather than handing it to an insolvency administrator. Protective shield proceedings (Section 270d InsO) are a special form for companies that are not yet illiquid: the court grants up to three months to prepare an insolvency plan under protection from enforcement. Both routes preserve the influence of the existing management and suit a prepared, plan-based restructuring.
Yes. Once insolvency maturity has arisen, payments that reduce the insolvency estate are generally prohibited (Section 15b InsO); management is personally liable for such payments, and for losses caused by late filing. Criminal liability for delaying insolvency and risks from unpaid social security contributions come on top. D&O insurance does not cover all of these cases. We advise early on crisis detection and limiting liability and defend against liability claims.
Through insolvency clawback (Sections 129 et seq. InsO), the administrator can reclaim payments and other benefits that the company made to individual creditors before the insolvency, in order to enlarge the estate. Particularly far-reaching is clawback for intentional disadvantage, whose look-back period extends several years. Whether a clawback succeeds depends on knowledge, payment arrangements and timing. We examine the requirements closely and defend against unjustified claims; the exposure can often be reduced considerably.
If a customer becomes insolvent, securing your rights determines your loss. A validly agreed retention of title gives you a right to separate or preferential satisfaction in goods still present; open claims are registered with the insolvency schedule and receive the quota. For ongoing contracts, the administrator has an option whether to continue performance. We secure your rights, register claims and, where possible, negotiate the continuation of the supply relationship.
Acquisitions out of insolvency usually take the form of a transferring restructuring: through an asset deal, the buyer takes over the business and assets from the insolvency estate without the legacy liabilities of the legal entity. This allows a largely liability-free entry, but requires a fast, careful review and coordination with the administrator and creditors' committee. In employment terms, the transfer of business under Section 613a of the Civil Code applies. We structure and negotiate the acquisition and secure the critical assets.
After the proceedings open, the court invites creditors to register their claims with the administrator for the insolvency schedule within a deadline, stating grounds and amount and providing evidence. At the verification meeting, claims are established or disputed; the quota is later paid on established claims. Correct classification as ordinary, subordinate or secured is important. We handle the registration, represent you at the meetings and, where appropriate, on the creditors' committee.
Within the EU, the European Insolvency Regulation determines which court has jurisdiction and which law applies. The decisive factor is the centre of main interests (COMI); the main proceedings open there, and secondary proceedings in other member states are possible in addition. For groups with companies in several countries, coordination of the proceedings is key. We steer cross-border matters through an established network and ensure a consistent strategy across all jurisdictions.
