Slovak Financial Law News 2005
The Act also introduces the institute of so-called `debtor's restructuring' which mainly aims to solve the debtor's insolvency and simultaneously to maintain the debtor's business. The debtor that is insolvent or that is under an imminent risk of insolvency is entitled to entrust the trustee with preparing a restructuring opinion (the ``opinion'') in order to ascertain whether the prerequisites for the debtor's restructuring have been fulfilled. A duty of the debtor to file a petition for the declaration of bankruptcy in time is not affected thereby. The debtor's creditors are also entitled to file such proposal under certain conditions. The basic prerequisites for approving the restructuring include (i) a legitimate prerequisite for the maintenance of at least substantial part of the debtor's establishment, and also (ii) a legitimate prerequisite for satisfaction of the debtor's creditors to a larger extent than in the event of the
declaration of bankruptcy.
A restructuring plan is the fundamental document in the restructuring process, which after it has been acknowledged by the court becomes binding upon all parties to the plan. This plan must be drawn up in such a way that it ensures the highest degree of satisfaction of the debtor's creditors while the factuality and sustainability of this plan should be maintained. The restructuring plan is a document regulating the establishment, change or expiry of rights and obligations of the persons listed therein, as well as the scope and method of satisfaction of the parties to the plan which are creditors of lodged claims, or shareholders of the debtor. This plan is binding upon all its parties after it has been acknowledged by the court. The restructuring plan consists of a descriptive part and a binding part.
Restructuring proceedings can commence also in the course of bankruptcy proceedings; if the restructuring is permitted by the court, the bankruptcy proceedings will be suspended.
In connection with the debtor's restructuring, the Act further regulates the institute of so-called `supervisory administration' as supervision over adherence to the fulfilment of the restructuring plan and also supervision of the trustee and the court over the debtor in the course of restructuring.
© Chechova & Partners (Bratislava)
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