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[BANKRUPTCY, INSOLVENCY & REHABILITATION PROCEEDINGS IN GREECE]
injunction. Prerequisites for such an application are the written declaration of the creditors who represent at least 20% of the total debts that they participate to the negotiations, that an urgency/imminent danger exists, and that the application has been uploaded to the Electronic Registry of Solvency. The provisional measures cover the period of the negotiations between the debtor and its creditors in order to achieve a rehabilitation agreement and their purpose is, on one hand, to maintain the undertaking in the view of its rehabilitation and, on the other hand, to achieve “serenity” during the negotiations. In addition, until the hearing and the issuance of the injunction, the above applicant may apply to the court for a Provisional Order (the provisional order is a “fast track” procedure which takes place usually within several days and there is not a formal hearing. The Judge examines the application, and it is at his/her discretion to order provisional measures, until the hearing or until the issuance of the injunctions decision). When the hearing of the injunctions takes place, the court may keep the provisional order valid, or it can modify it, or it may revoke it as well. The provisional measures are valid until submitting to the court the rehabilitation agreement and cannot exceed 4 months from the decision or the provisional order. After that time limit, the provisional measures are void (under some conditions the above period may be extended, only for the suspension of any enforcement of creditor’s claims against the debtor, however the total period must not exceed 6 months). The competent court may revoke or modify the provisional measures at any time either ex officio or following a relevant application by anyone who has a legitimate interest.
2.1.2 The Provisional Measures-the Type of the Protection The court is not bound by any measures that are mentioned in the application. It has a wide range of options, such as ordering some of the measures asked or even ordering completely different measures at its discretion. The provisional measures may, indicatively, include the suspension of any enforcement of creditor’s claims against the debtor (e.g. by seizure of assets), the prohibition of submitting any civil action against the debtor, the ban of proceeding with injunction against the debtor, the ban of transferring of the real estate property and the business equipment on behalf of the debtor, appointing a sequestrator, banning any termination of contracts, ordering the prolongation of contracts that are to be expired, maintenance of the current jobs in the company etc. Moreover, for serious reason the court can also decide to apply the protection to the guarantors of the debtor or other co-debtors as well. The court may also appoint a Special Receiver with the power to undertake the management of the debtor partially or totally (even without the consent of the debtor). The aforementioned protection may bind all or several of the creditors (depending on the court's decision), including also the State (for taxes etc.). It must be noted that any action on behalf of any person who is bound by the provisional measures (e.g., a creditor), that is in breach of the provisional measures granted, is void. Furthermore, the provisional measures do not apply regarding some specific types of claims such as the termination of a lease agreement, if the debtor owes at least six-month rents, the financial security agreements of the L. 3301/2004 or when an “important social reason”
ILN Restructuring & Insolvency Group – Bankruptcy, Insolvency & Rehabilitation Series
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