Agreement with creditors in Romania
Commercial lawyer in Romania. Insolvency in Romania
The procedure of agreement with creditors in Romania is aimed at commercial companies facing financial difficulties but that have not yet reached the point of being considered in insolvency in Romania. The purpose of the preventive agreement is precisely to prevent entering into the insolvency procedure for a Romanian company by concluding an agreement between the creditor in Romania and the debtor in Romania involved, thus providing an amicable understanding for achieving a restructuring plan in Romania and avoiding reaching business insolvency in Romania.
The Romanian Law Firm Pavel Mărgărit and Associates recommends seeking the services of an insolvency lawyer in Romania or a commercial lawyer in Romania to be informed about all the legal aspects related to insolvency law in Romania and the agreement procedure. In addition to analyzing the financial situation of the debtor in Romania and establishing the existence of conditions to request the preventive agreement, a commercial lawyer can also assist you in drafting the opening request, the procedure of agreement with creditors in Romania, submitting it to the syndic judge in Romania, and even developing a restructuring plan in Romania that complies with all the provisions contained in the insolvency law in Romania, namely law 85/2014, and does not infringe upon the rights of the creditor in Romania. The Romanian Law Firm Pavel Mărgărit and Associates collaborates with top financial experts who can help you create a restructuring plan that ensures business efficiency and economic recovery to avoid the insolvency procedure.
Insolvency lawyer in Romania. Agreement with creditors in Romania
The procedure of agreement with creditors in Romania is initiated by the filing of a request by the debtor in financial difficulty. Financial difficulty is understood as any circumstance that temporarily affects the economic activity carried out by a Romanian company, namely the future possibilities available to the debtor in Romania to pay its debts as they become due.
As mentioned earlier, the request for the preventive agreement can be made by the debtor in financial difficulty; however, there are some exceptions to this rule. Thus, individuals who have benefited from such a request in the three years prior to filing the request, individuals who have been convicted of intentional crimes against property, corruption, service crimes, forgery, crimes provided for by certain special laws, and those who are already in the insolvency in Romania procedure cannot file such a request. Additionally, the procedure that avoids the status of a company in insolvency (preventive agreement) may also be initiated at the request of a creditor in Romania who holds a certain and liquid claim, provided that the debtor in difficulty gives prior consent. The request regarding the opening of the preventive agreement procedure, which can also be submitted through a commercial lawyer in Romania or an insolvency lawyer in Romania, is judged in chambers by a syndic judge in Romania on an urgent basis, with the parties being summoned within 48 hours. If all the conditions required by the insolvency law in Romania, namely law 85/2014, are met, the syndic judge will issue a decision to open the procedure. Collaborating with specialized lawyers for a business insolvency in Romania ensures that all legal formalities are respected and that the proposed solutions are sustainable from a legal and financial perspective.
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Lawyer for business insolvency in Romania. Restructuring plan in Romania
One of the most important steps in the procedure of agreement with creditors in Romania consists of developing a restructuring plan in Romania and economic recovery to avoid difficulties that may arise for a business insolvency in Romania. The concordat administrator has 60 days from the date of opening the procedure to prepare a restructuring plan. They can either draft the plan themselves or assist the affected debtor in Romania in preparing it.
A restructuring plan must include, among other things, an analysis of the economic situation of the debtor, the employees, as well as a description of the causes and the level of difficulties faced by the debtor at the time of drafting the plan. It should outline the proposed restructuring measures, the budget involved, and the operational changes that will occur for a Romanian company following the preventive concordat procedure.
After the restructuring plan is drafted, it will be submitted for approval by the creditor in Romania who holds affected claims, as only they have voting rights in this case. Additionally, the plan must be approved by a syndic judge in Romania at the request of the debtor, within a maximum of 3 days from the completion of the approval minutes. The decision is also rendered in chambers within a maximum of 10 days from the date of registration of the request.
The deadline for the debtor to implement the measures included in the restructuring plan is 48 months from the date of its approval by an enforceable decision, with the possibility of extending this period by 12 months. Furthermore, in the first year, it is mandatory to pay at least 10% of the value of the claims for which the preventive agreement has been concluded. At the same time, from the moment the procedure of concordat is opened, the rights of enforcement against the debtor are suspended, and the prescription period for requesting enforcement is also suspended for a maximum period of 4 months, but no later than the date of the ruling on the approval of the restructuring plan or the closure of the procedure, according to the regulations included in the insolvency law in Romania.
Until a ruling is issued to terminate the concordat procedure, insolvency proceedings cannot be initiated against the debtor at the request of an affected creditor. Therefore, the preventive agreement procedure is an alternative solution to prevent the state of insolvency for a business that allows debtors in difficulty to continue their operations and reorganize their debts, while also offering creditors a greater chance of recovering their claims, thus avoiding the difficulties faced by a company in insolvency. The Romanian Law Firm Pavel, Mărgărit and Associates offers high-standard professional legal services in various practice areas, including those concerning preventive agreements or a business insolvency in Romania. Our team demonstrates a complex understanding of the regulations regarding business insolvency, providing clear and efficient legal solutions to all clients who have requested the services of a commercial lawyer in Romania.
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