Can I save my company by filing for insolvency proceedings?
Insolvency proceedings have a negative connotation that we must dismantle. This tool, well planned and above all applied in time, is very effective in saving a business.
The most important thing is to have a clear strategy from the outset. A detailed and realistic picture of the risks, debts and implications of each option on the table. Often family wealth is linked to the business, it is key to be well advised to survive.
There are many viable businesses that may find themselves in difficult circumstances on a temporary basis. This can happen for a variety of reasons, for example:
- An investment gone wrong.
- Non-payment by a major client.
- An accumulation of debts due to a temporary closure as caused by COVID 19.
An arrangement with creditors opens the door to negotiate a write-off of those debts or a deferral of payments. Giving the business a breathing space and allowing it to get back on its feet. In the following video you can learn more about how an early insolvency can help you save your business.
Even if the situation is very precarious and the company eventually has to be liquidated, it allows for options such as the sale of the business unit free of debt to a third party, thus opening up the possibility of safeguarding any jobs that may exist.
Another key point is that filing for insolvency proceedings can save the administrator’s liability because he/she has acted diligently by taking the necessary measures in time without letting the business drag on without a strategy.
A good lawyer specialised in insolvency and economic law will advise you on measures to make the business viable, quantify and minimise the possible liabilities and personal risks and the procedures and deadlines. We go one step further and always accompany you, aware of the emotional burden that such a process entails.
Don’t let fear overcome you, talk to us.
Image of Ngo Minh Tuan in Pixabay
