[BANKRUPTCY, INSOLVENCY & REHABILITATION PROCEEDINGS IN THE NETHERLANDS] 57
bankruptcy ( curator and rechter-commissaris) if a suspension of payments is converted into a bankruptcy. In a WHOA-procedure, the debtor can propose a private plan to its creditors and shareholders of it can request the appointment of a restructuring expert ( herstructureringsdeskundige ), who can propose such a plan. If the private plan is proposed by the debtor itself, the district court has the possibility to appoint an observer ( observator ) When the WHO-procedure was filed by a creditor, a shareholder, the debtor’s work council or the debtor’s workplace representation the court will always appoint a restructuring expert who then is entitled to propose the plan to the exclusion
Also excluded are creditors to the bankruptcy estate ( boedelcrediteuren ). They can enforce their rights on the bankrupt estate. The supervisory judge, however, can issue a stay period ( afkoelingsperiode ) stipulating that for a stay period not exceeding two months, each right of third parties, including secured creditors and creditors to the bankruptcy estate, to enforce against the debtor’s assets or to claim assets under the control of the bankruptcy, can only be exercised with his authorization. Pending lawsuits instituted against the debtor before the opening of the bankruptcy that procure the performance of an obligation from the debtor are suspended by operation of law and will only continue if the obligation is disputed in the verification process. III. Suspension of payment The debtor who expects that he will be unable to continue paying its debts, can be granted a suspension of (moratorium on) payment. During the suspension of payment, only unsecured and non-preferential creditors are prohibited from enforcing their claim against the debtor’s assets. Creditors of secured claims (holders of right of pledge of mortgage) or preferential creditors (such as the Dutch Tax Authority, employees or other creditors whose claim is preferential by law) can enforce their rights as if the proceeding has not been opened. As a result of the granting of suspension of payment, as of 0:00 hours of the day on which the court grants suspension of payment, the debtor can only exercise its power of disposition and capacity in relation to its assets with the cooperation or authorization of the administrator. This is where the suspension of payments differs from a debtor in possession proceeding. Creditors of unsecured and non-preferential claims are prohibited from enforcing actions
of the debtor. II. Bankruptcy
A bankruptcy can be filed when the debtor is in a situation where he has stopped paying its due and demandable debts. In bankruptcy the debtor loses its power of disposition and capacity in relation to its assets as of 0:00 hours of the day on which the court opens a bankruptcy procedure. During the course of the bankruptcy this right lies exclusively with the administrator. It is also described as a general attachment on the assets of the debtor in favor of its creditors to be settled by the administrator. As a result, by law creditors can only enforce claims on the debtor by lodging their claim with the administrator and have to await the claim verification procedure. Creditors are prohibited from enforcing actions against the debtor’s assets and seizures made prior to opening of the bankruptcy cease to exist. Excluded from this prohibition are secured creditors who either have a right of pledge or a right of mortgage. They are allowed to act as if the bankruptcy does not exist and can enforce those rights against the debtor’s secured assets.
ILN Restructuring & Insolvency Group – Bankruptcy, Insolvency & Rehabilitation Series
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