European Restructuring Monitor (ERM)
Eurofound's ERM database on restructuring-related legal regulations provides information on regulations in the Member States of the European Union and Norway which are explicitly or implicitly linked to anticipating and managing change.
Section 316–364
The application for insolvency can be made either by the insolvent company or by the creditors.Three options are available in case of insolvency: reorganisation, debt relief and bankruptcy.Reorganisation, according to the Act No. 182/2006 Coll., aims to satisfy creditors' claims while allowing the company to continue its business. Conditions for permission of reorganisation by the court are:
Debt relief is another measure that must be agreed by the creditors (provided that creditors receive no less than 30% of the amounts due) and approved by the court.
If the two options above are not feasible, the court proceeds with bankruptcy measures.
The reorganisation can be done mainly through the following measures:
If the court approves the reorganisation, the insolvency administrator is also appointed by the court.
The insolvency administrator shall exercise supervision over the activities of the debtor and perform tasks such as surveying of the estate and its inventory, leading incidental disputes, compiling and adding a list of creditors. In addition, the insolvency administrator shall regularly inform the bankruptcy court and creditors' committee about the results of his/her activities.
This act regulates the resolution of insolvency of the debtor established by court procedures through one of the following procedures: restructuring, debt relief or bankruptcy. These procedures allow to achieve the highest possible proportional satisfaction of the debtor’s credit for all creditors.Restructuring according to this act is used rarely in the Czech Republic. For data on insolvency proceedings, visit the Ministry of Justice of the Czech Republic / Ministerstvo spravedlnosti eské republiky
Eurofound (2016), Czechia: Rescue procedures in insolvency, Restructuring legislation database, Dublin, https://apps.eurofound.europa.eu/legislationdb/rescue-procedures-in-insolvency/czechia
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