Radkiewicz Lawyers Poland provides corporate restructuring services to companies across Poland. In our operations, we rely on the provisions of the Polish Restructuring Law and the Bankruptcy Law acts. Presented below are some of the options available to business enterprises facing corporate restructuring.
Restructuring of a business
During the lifetime of a company, there are situations which require implementation of a recovery plan and redefinition of its business objectives. In particular, that refers to the state of insolvency and formal restructuring proceedings. The restructuring of a company requires a special plan which should include elements specified in detail in the provisions of the Polish Restructuring Law. Once the proceedings have been opened, they should also be supervised by qualified experts.
The restructuring process of a business enterprise facing financial problems can be carried out both in and out of court. The out-of-court restructuring of a business may involve its reorganisation, mergers, divisions, a change of its legal form, as well as renegotiations of its contracts. Sometimes it is also advisable to take advantage of arrangement approval proceedings characterised by minimum court involvement. The range of solutions available to businesses as part of the restructuring process is very wide. Particularly useful may be remedial proceedings which, unlike arrangement approval proceedings, require active participation of the court.
Polish restructuring law allows businesses to enter into arrangements with creditors concerning, inter alia, reduction of debt, staged payment and debt deferral. As part of the restructuring process, economic operators may also offer their creditors more complicated solutions involving, for example, securing debt obligations and debt-for-equity swaps. Businesses that are insolvent or at risk of insolvency can also resort to other in-court restructuring proceedings, such as accelerated arrangement proceedings, standard arrangement proceedings and remedial proceedings.
Restructuring proceedings should be opened early enough to ensure that all legally permitted actions are taken to protect a business from bankruptcy (bankruptcy proceedings). For example, accelerated arrangement proceedings allow the debtor to avoid bankruptcy as a result of an arrangement entered into with creditors. Opening and carrying out restructuring proceedings without professional support may result in wrong, and often costly decisions. That is why it is so important to seek professional advice from a lawyer with relevant experience, able to help save the company and prevent it from bankruptcy. Professional legal support will ensure smooth conduct of the accelerated arrangement proceedings and significantly increase the chances of achieving the desired results by the client.
It should be borne in mind that the accelerated arrangement proceedings are considerably less time-consuming than the standard arrangement proceedings in the course of which objections against claims being entered in the insolvency table must be processed.
In-court restructuring process
Polish restructuring law provides for specific types of proceedings under which an insolvent business enterprise or one at a risk of insolvency may undertake specific restructuring actions. For this purpose, a business that is insolvent or at risk of insolvency may file an application with the court upon which the restructuring proceedings are initiated.
The restructuring process is carried out according to strictly defined rules. Polish law provides for four procedures under which the restructuring proceedings may be carried out, namely:
- proceedings for the approval of an arrangement between a business operator and its creditors;
- accelerated arrangement proceedings;
- arrangement proceedings and
- remedial proceedings.
Radkiewicz Lawyers Poland provides to its clients the necessary support at every stage of the restructuring process.
Restructuring of a business does not have to result in significant reduction of employment. Nevertheless, in the event of decreased demand for products or services offered by an enterprise, collective redundancies will often be inevitable in order to reduce costs, including labour costs.
It is crucial that remedial measures are initiated by entrepreneurs in good time. A suitable restructuring plan must also be prepared. One must bear in mind that the restructuring of a business is aimed at improving its financial situation. Failure to act in a timely manner may lead to insolvency and the necessity to declare an enterprise bankrupt. By resorting to our services, you ensure that the restructuring proceedings will be carried out swiftly, efficiently and in accordance with the applicable procedures.
It is worth noting that submitting an application in the restructuring proceedings does not release the applicant from the obligation to notify its bankruptcy. A business operator is required to file for bankruptcy with the court within 30 days of becoming insolvent. It may, however, be released from the liability for failing to submit a bankruptcy petition in time if it proves that within the said time limit an arrangement was approved in arrangement approval proceedings or that restructuring proceedings were initiated. A bankruptcy petition may be filed by the debtor, as well as by any of the debtor’s personal creditors. However, if the claims are disputed, such petition is often dismissed.
Corporate restructuring – Warsaw, Poland
To conclude, it is worthwhile to take advantage of the opportunities offered by the Polish legal framework to save a business from bankruptcy. Radkiewicz Lawyers Poland offers a wide range of legal services across Poland. Our office is located in Warsaw at 59 Złota Street. You may contact us by phone at: +48 22 489 52 65. Our practice areas include bankruptcy law and corporate restructuring.
Our lawyers provide comprehensive support and consultancy to businesses at risk of bankruptcy. We provide legal assistance in matters concerning reorganisation, restructuring and winding up of businesses, with a particular focus on debt restructuring and debt refinancing. The restructuring process often results in some difficult decision-making which, with the support of Radkiewicz Lawyers Poland, may certainly be alleviated.
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