BANKRUPTCY, INSOLVENCY & REHABILITATION PROCEEDINGS IN SLOVAKIA]
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not claim the return of the performance shall be jointly and severally liable for its return against the company and the creditors. We would like to also draw your attention to the aspect of holding company law which is contained in the Slovak law, on the basis of which the controlling person (i.e. a person who holds a majority of the voting rights either by virtue of ownership of a business share or by virtue of the shareholders agreement) shall be liable to the creditors of the controlled person for damage caused by the bankruptcy of the controlled person, provided that the controlling person's conduct considerably contributed to the bankruptcy of the controlled person. The controlling person shall be released from such liability if they prove that they acted in an informed manner and in good faith that they were acting for the benefit of the controlled person. Unless a different amount of damage is proved, it shall be deemed that the creditor incurred damage to the extent to which their receivable was not satisfied after the termination of the bankruptcy proceedings conducted against the controlled person due to a lack of property, cancellation of the bankruptcy declared against the property of the controlled person due to a lack of property, the termination of execution or similar enforcement proceedings conducted against the controlled person due to a lack of property or the dissolution of the controlled person without a legal successor. (2) Preventive restructuring proceeding Since July 2022, the Act No. 111/2022 Coll. on the resolution of impending bankruptcy (the “Act”), has been in force in Slovakia. The Act introduced preventive restructuring and temporary protection of the debtor. This law is a consequence of the transposition of Directive
(EU) 2019/1023 of the European Parliament and of the Council of 20 June 2019 on preventive restructuring frameworks, on discharge of debt and disqualifications, and on measures to increase the efficiency of procedures concerning restructuring, insolvency and discharge of debt, and amending Directive (EU) 2017/1132 (Directive on restructuring and insolvency). When a debtor (meaning only a legal person) discovers that it is at risk of insolvency in the next 12 calendar months, i.e. that the debtor is more than 90 days late in meeting at least two financial liabilities with more than one creditor, it has an obligation to monitor its financial situation very closely and to take appropriate measures to avert it without undue delay. To assess whether insolvency is imminent, it is important to compare the amount of due monetary liabilities and monetary assets. If the difference is more than 1/10 of the debtor's due monetary liabilities “ coverage gap ” and he will not be able to reverse this situation even within 60 days, the debtor is deemed to have become insolvent, and it should take appropriate precautionary measures. One of the measures the debtor can take is the preventive restructuring proceeding. For the purposes of determining insolvency, monetary assets are: a) cash, b) claims on an account, deposit or other form of deposit in a bank or branch of a foreign bank c) monetary claims, securities and financial instruments maturing within 30 days, where, in the exercise of professional diligence, their due and punctual fulfilment can reasonably be expected, d) monetary claims, securities and financial instruments not more than 30 days overdue if, in the exercise of professional diligence,
ILN Restructuring & Insolvency Group – Bankruptcy, Insolvency & Rehabilitation Series
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