A company is insolvent if it fails to pay the debt to a creditor within 60 days of maturity. Law no. 85/2014, also called the insolvency law, imposes a value of the debt threshold for which insolvency can be claimed, namely 40,000 lei.
The insolvency procedure is based on an application submitted by the debtor to the Court. Also, the application may be submitted by one or more creditors, or by persons or institutions expressly provided for by law. In order to file an application for the opening of insolvency proceedings, the debtor may call upon the services of a restructuring and insolvency lawyer who, in addition to this, may advise the debtor on the steps to be followed later, according to the Pavel, Margarit & Associates Romanian Law Firm.
When the conditions for insolvency are met, the debtor is legally obliged to file the application for the opening of the insolvency proceedings within 30 days of the occurrence of insolvency. The debtor must also attach to the request the proof of the notification of the competent tax authority.
The debtor may also submit the claim when he considers that the occurrence of insolvency is imminent. Law no. 85/2014 also provides that if the debtor introduces prematurely, in bad faith, the request for the opening of proceedings entails the patrimonial liability of the natural or legal person who is liable for the damage suffered.
At the moment of filing it to the Court, the debtor’s request for opening the insolvency proceedings must be accompanied by the following documents:
a) the last annual financial statement, certified by the administrator and the censor/auditor, the fiscal balance for the month preceding the date of registration of the request for the opening of the procedure;b) the complete list of all the debtor’s assets, including all the accounts and banks through which the debtor runs its funds; c) the list of creditors’ names and addresses, their claims: cert or conditional, liquid or illiquid, maturing or non-occurring, uncontested or contested etc.;d) the list of payments and patrimonial transfers made by the debtor in the 6 months preceding the filing of the application;e) the profit and loss account for the year preceding the filing of the application;f) the list of the members of the economic interest group or, as the case may be, of the associates with unlimited liability, for the collective and the limited companies;g) a statement by which the debtor shows his intention to enter into a simplified or reorganized procedure, according to a plan;h) a brief description of the ways it envisages the reorganization of the activity;i) a declaration on own responsibility, authenticated by a notary or certified by a lawyer, which certifies if the company has been subjected to the judicial reorganization procedure provided by the present law within 5 years prior to the filing of the application;j) a declaration on own responsibility, certified by a notary or certified by a lawyer, showing that the directors or shareholders, or the associates of the debtor have not been finally convicted for committing an intentional crime against patrimony, corruption and service, as well as for the offenses provided by the legislation in force; (k) a statement by which the debtor indicates whether he is a member of a group of companies, specifying them;l) the proof of the unique registration code;m) proof of notification to the competent fiscal body.
The sooner the company applies for insolvency, the higher are the chances to have a successful restructuring. Over the years, Pavel, Margarit & Associates Romanian Law Firm advised a lot of insolvent companies as well as managers of companies that opened the insolvency proceedings. Lawyers from Pavel, Margarit & Associates Romanian Law Firm managed to help companies to restructure their businesses and reintegrate into the economic environment. The results are very important taking into account that only 5% of insolvent companies succeed in restructuring.
Pavel, Mărgărit & Associates Romanian Law Firm is one of the top law firms in Romania, which offers legal services at the highest quality, beyond client’s expectations. The Law Firm approaches the cases with maximum professionalism and dedication. It’s ultimate goal is obtaining exceptional results and achieving the client’s objectives, in a time efficient manner. Among Pavel, Mărgărit & Associates clients are top multinationals and local companies. In 2018, the success stories of the Romanian Law Firm have brought recognition of the most prestigious international guides and publications. Thus, Pavel, Mărgărit & Associates Romanian Law Firm ranked second place in Romania in the rankings of business law firms with the most relevant expertise this year, realised by the Legal 500 publication, the most prestigious guide for law firms in the world, based in London, UK. The law firm is also recognized internationally by IFLR 1000 Financial and Corporate Guide 2018. Pavel, Mărgărit & Associates Romanian Law Firm is also the only law firm in Romania recommended by the Global Law Experts Director in London in the Dispute Resolution area of Practice. All the relevant information regarding Pavel, Mărgărit & Associates Romanian Law Firm including areas of practice and the most important deals can be found on the website www.avocatpavel.com, which is one of the most complex law firm websites in Romania.