In the practice of our PRWT accounting office, we have recently been faced with questions from our clients who, due to the SARS-CoV-2 coronavirus pandemic, have fallen into serious financial problems resulting in a lack of financial liquidity – what should they do? The question that clients ask accountants and lawyers cooperating with PRWT is whether to already liquidate the company they run. Our accounting office has more and more questions of this kind lately.

In such cases, first of all, we pay attention to the possibilities provided by the Restructuring Law of 15 May 2015 (consolidated text, Journal of Laws of 2020, item 814, as amended). It is not necessary that in the case of already existing insolvency or a threat of insolvency, a decision must be made to terminate the company’s operations.
PRWT’s accounting office and lawyers cooperating with our accounting office help in the carry out entire process of restructuring of commercial law companies.

When can such restructuring be carried out and what is it for?

The purpose of the restructuring procedure is to avoid the declaration of bankruptcy of the company by enabling its restructuring by concluding an arrangement with creditors, and in the case of sanaction proceedings – also by carrying out sanation measures.

The regulations currently in force provide for four types of restructuring proceedings:
– proceedings for approval of the arrangement,
– accelerated arrangement proceedings,
– composition proceedings,
– sanaction proceedings.

The financial and accounting analysis carried out by our PRWT accounting office usually gives an answer to the question which of these types of restructuring proceedings can be applied. It should be noted that these are different procedures, which differ mainly in the speed and cost of their execution. The costs to be reckoned with in this case for any company with financial problems is a matter of essential.

Proceedings for approval of an arrangement
– enables the conclusion of an arrangement as a result of the debtor’s independent collection of votes creditors without the participation of the court,
– may be conducted if the sum of disputed claims entitling to vote on the arrangement does not exceed 15% of the sum of claims entitling to vote on the arrangement.

Accelerated arrangement proceedings
– enables the debtor to conclude an arrangement after the preparation and approval of the list of claims in a simplified manner,
– may be conducted if the sum of disputed claims entitling to vote on the arrangement does not exceed 15% of the sum of claims entitling to vote on the arrangement.

Composition proceedings
– enables the debtor to conclude an arrangement after the list of claims has been drawn up and approved;
– may be conducted if the sum of disputed claims entitling to vote on the arrangement does not exceed 15% of the sum of claims entitling to vote on the arrangement.

Sanatory proceedings
Enables the debtor to carry out rehabilitation measures and to conclude an arrangement after the preparation and approval of the list of claims.
Sanations actions are legal and factual actions that are aimed at improving the economic situation of the debtor and are aimed at restoring the debtor’s ability to perform obligations, while protecting against enforcement.

Who can restructure?
The following may be subject to the restructuring process:
– entrepreneurs within the meaning of the Act of 23 April 1964 – Civil Code (consolidated text, Journal of Laws of 2019, item 1145, as amended),
– limited liability companies and joint-stock companies that do not conduct business activity,
– partners of partnership companies that are liable for the company’s obligations without being limited with all their assets,
– partners of a partnership company.

If your company is currently faced with the dilemma of what to do, whether you are to liquidate your company or submit it to bankruptcy, consider the possibilities offered by the above-mentioned the Act on Restructuring Proceedings.In our accounting office, before making a decision, you will certainly receive accounting and legal assistance of lawyers cooperating with our accounting office.