At Lunch & Law on 3 June 2021 in Winterthur, Georg Weber gave a presentation on the topic of ‘My company in financial distress – what should and can I do?’. The practice-oriented presentation highlighted the legal and economic options available to companies facing imminent bankruptcy or excessive debt.
Act early – know your legal obligations
A company is considered over-indebted or insolvent if its debts are no longer covered by its assets or if it can no longer meet its payment obligations. It is important to react early: the sooner measures are taken, the greater the chances of recovery.
Restructuring options and alternatives
Various measures can be considered to overcome financial difficulties:
- Subordination of claims by shareholders
- Capital reduction and re-increase (‘harmonisation restructuring’)
- Insolvency proceedings with debt deferral or debt reduction
- Establishment of a rescue company to continue profitable business areas
It is essential that measures are implemented in good time and with professional support.
Conclusion
The presentation clearly showed that impending over-indebtedness does not automatically mean the end. With the right legal and financial steps, the chances of recovery can be preserved and liability risks avoided.
The presentation given at the event is viewable here.
