Concordat Within Bankruptcy

A concordat proposed after bankruptcy opens may offer the creditor a payment alternative to liquidation. Assessing the proposal solely by its payment dates or reduction percentage is insufficient. The plan's feasibility, the status of claims, and the liquidation alternative must be considered together.

When Is a Concordat Within Bankruptcy Considered?

A post-bankruptcy concordat proceeds through the special procedures and bodies within bankruptcy. Creditor assessment of the debtor's offer and court confirmation each have their own conditions. Not all consequences of moratorium decisions in a pre-bankruptcy concordat transfer unchanged to this process.

For example, even if the promised payment appears higher, the asset funding it and the payment timetable may be unclear. When comparing the plan with recovery through liquidation, expenses, security, and the claim's ranking must be considered. Revocation of bankruptcy and the effects of the plan's provisions must also be monitored as separate stages.

Examine the Remedy and the Stage of the File Together

Registration of the claim, voting rights, and how the proposal affects it must be examined separately. A secured claim or assertion of a special right requires separate identification of its position in the plan. How liquidation will continue if the offer is not accepted or confirmed must also be included in the economic assessment. A summary sent by the debtor does not replace the official file and announcements.

Documents to Prepare for the Initial Review

• Bankruptcy and liquidation file records
• The concordat offer and annexes
• Documents on claim registration and voting status
• Meeting records, announcements, and court decisions

When assessing the offer, compare the expected payment with recovery prospects in bankruptcy liquidation, the claim's ranking, and existing security together.

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