Company Administration in Case of Insolvency
Company Administration in Case of InsolvencyUpdated on Friday 14th April 2023
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Company administration in case of insolvency in Belgium is a process through which a company is protected from legal actions against it when facing financial difficulties. It is a process through which the business has a time during which it can either organize a recovery plan or commence the formal procedures for winding up when it can no longer be rescued.
Our lawyers in Belgium are able to assist company owners throughout this legal process and answer any questions related to whether or not this action is suitable for a certain business.
A process in favor of company rehabilitation
In essence, company administration is a process through which a company gains more time to solve the financial difficulties or restructure. Below, our team of attorneys in Belgium describe the four most important characteristics of this legal process:
- it is an insolvency procedure: company administration is one of the formal procedures that may be commenced when a company is considered insolvent.
- it temporarily preserves the unity of the company: during this process, the company retains its unity as a functioning business structure, until the plan for the financial restructuring is in place.
- it is directed by an administrator: the process involves the appointment of an administrator who will propose a strategy for rescuing the company.
- it can be commenced by different parties: entering into administration can come as a result of the company director’s wish, through a secured creditor and even by court order.
A company in Belgium may choose to enter into administration via the company director, which is a simpler process and will use an our-our-court procedure to appoint the administrator. One of our lawyers in Belgium can give you complete details about the duties and the powers of the administrator.
The insolvency process is one during which the assistance of an accountant is often not only beneficial, but mandatory. Our Belgian accountants can also provide solutions for companies that are going through a restructuring phase or are under the insolvency procedures. Making the needed payments to creditors, and making sure that the remaining assets are properly distributed is easier with the assistance of a team of experts.
Eligibility for company administration in Belgium
Company administration can be commenced when:
- the company is in serious financial difficulty but the core business can and should be preserved.
- the business must be sold quickly.
- the creditors do not agree to a usual restructuring process.
The team of experts at our Belgian law firm can give you complete details about the administration procedure and how the company can continue to trade during this time. Contact us for more information as well as legal counseling.