[BANKRUPTCY, INSOLVENCY & REHABILITATION PROCEEDINGS IN ROMANIA] 73
KEY FACTS OF BANKRUPTCY, INSOLVENCY & REHABILITATION PROCEEDINGS UNDER ROMANIAN LAW
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include a reorganization plan for the debtor. If the creditors approve the project, the debtor’s activity shall be carried on in accordance with such project, for a period of a maximum of 48 months, with the possibility of extending it for another 12 months. During the first year of the implementation of the restructuring plan, the debtor must reimburse a minimum of 10% of the claims affected by the preventive agreement. Insolvency procedure The insolvency procedure may be requested either by the debtor or by any creditor, if debts in the amount of a minimum of RON 50,000 (approximately EUR 10,000) are due for more than 60 days. If the court approves the request, depending on the debtor’s situation, the procedure may be started in one of the following forms: General procedure In such case, the debtor enters an observation period, in which the official receiver analyses if there are any chances for the company to be reorganized. Following this first step, the debtor may enter one of the following procedures: (i) Reorganization, in which the debtor’s activity is reorganized in accordance with a reorganization plan, approved by the creditors. The plan may provide various measures, such as reducing the debt or rescheduling one or more
bankruptcy/insolvency/rehabilitation proceedings of the country and their main differences. Romanian legislation provides two main categories of such procedures: I. Insolvency prevention procedures I.1. Restructuring agreement A debtor who faces financial difficulties may propose a restructuring agreement, which can be drawn up either by the restructuring administrator or by the debtor, with the assistance of the restructuring administrator. Among others, the restructuring agreement must contain an analysis on the economic situation of the debtor, a list of the claims which will be and not be affected by the reorganization agreement and the proposed
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restructuring measures which can be either operational, financial or human resources oriented. The agreement will eventually be voted upon by the affected creditor(s), based on the categories in which they fall. The purpose of the restructuring agreement is for the debtor to restructure its activity and to reach an agreement with its creditor(s) regarding the payment of the due debts. Preventive agreement If the debtor faces financial difficulties, it can request the court to open the preventive agreement procedure. The court appoints an administrator contracted by the debtor, who drafts the restructuring plan or assists the debtor in drafting it. The restructuring plan shall
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ILN Restructuring & Insolvency Group – Bankruptcy, Insolvency & Rehabilitation Series
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