The new Slovakian preventive restructuring framework aims to provide companies with a viable toolkit to deal with financial distress at an early stage and to counter the fact that the majority of Slovak companies enter an insolvency process having been insolvent for more than a year.
Main characteristics
Until recently, an appeal to enter debt restructuring in proceedings opposing a bankruptcy order was not allowed by the Dutch lower courts. In a ground-breaking ruling on 26 March 2021, the Dutch Supreme Court (ECLI:NL:HR:2021:460) put an end to this practice.
The case
The Slovak parliament recently passed a new law – The Temporary Protection of Distressed Undertakings Before Creditors – which came into effect on 1 January 2021. It replaces the current temporary protection (moratorium) adopted at the outset of the COVID-19 crisis.
The new regulation will only be granted where a majority of the unrelated creditors involved agree with the stay. This marks a departure from the COVID-19 moratorium, which could be easily accessed by all debtors impacted by the coronavirus pandemic.
Temporary Payment Deferral Act 2020
This proposal aims to prevent avoidable insolvencies and offer the court the option to:
On 22 April 2020, the Slovak parliament passed a new law to help reduce the impact of COVID-19.
It is now possible for businesses to request temporary protection that will have the following effects:
Since the outbreak of COVID-19 in Europe, the Slovak Parliament has adopted a series of new laws aiming predominantly to support employment, to provide financial aid and tax relief (particularly to SMEs) and to preserve and regulate legal enforcement.
The insolvency law related measures include mainly:
Debtor's filing
The statutory time limit for debtors to file for bankruptcy due to over-indebtedness (balance sheet test) that occurred between 12 March and 30 April 2020 has been prolonged from 30 to 60 days (and is expected to be prolonged further).
Unfortunately your business can be confronted with bankruptcy of one of your (Dutch) business partners. In most cases this will damage your business. We can help you to avoid or limit damages. In this edition of TW FOUR we will set out FOUR ways to protect your business from the bankruptcy of one of your (Dutch) business partners.
De fiscale wetgever heeft in het kader van het Belastingplan 2018 voorgesteld om artikel 17 lid 2 Invorderingswet 1990 (hierna: “IW 1990”) te laten vervallen. Indien dit voorstel daadwerkelijk wordt ingevoerd, dan zou dit betekenen dat aan het verzet tegen de tenuitvoerlegging van een dwangbevel van de Ontvanger niet langer schorsende werking toekomt. Dit kan grote gevolgen hebben voor uw onderneming.
Background
New rules strengthen the position of individual creditors and weaken the concept of insolvency proceedings as a means of final collective satisfaction of creditors. Taylor Wessing in Bratislava, as an advisor to the Ministry of Justice, has been actively involved in the creation of this new regime.
New provisions