Bankruptcy

Bankruptcy is a state in which a debtor can find himself after bankruptcy has been filed by the debtor or creditors. In the event of bankruptcy, the debtor’s assets are seized. Moreover, bankruptcy can be filed for both a natural person and a company.

Before a bankruptcy will be declared, a number of conditions must be met.

First of all, the debtor must have stopped fulfilling his payment obligations, otherwise, there is no ground for bankruptcy.

If the application is made by a creditor, it must be checked whether the creditor actually has a claim against the debtor.

Finally, the conditions apply that there must be a plurality of creditors. This means that there are several creditors whose claims against the debtor have not been paid.

The purpose of bankruptcy is to sell the debtor’s assets so that the outstanding claims can be paid. The management of these assets (the estate) is in the hands of a curator. The trustee will sell the assets and distribute the proceeds among the creditors.