KIELTYKA GLADKOWSKI provides legal assistance to Clients in cross border bankruptcy proceedings in Poland. We advise court-appointed liquidators, trustees, foreign representatives, global enterprises, corporations. We assist in
– bankruptcy litigation,
– bankruptcy investigations,
– preparation of applications,
– acknowledgement of foreign bankruptcy orders in Poland,
– loan restructurings,
– interim security measures,
– mortgage security,
– official creditors’ committee representation,
– preparation of appeals,
– assessment of bankruptcy estate,
– sale and purchase of distressed assets,
– insurance.
The activities of enterprises more and more often go beyond the borders of one country. The failure of such companies has a negative impact on the proper functioning of the EU internal market.
In Poland, both legal and natural persons, entrepreneurs and non-business persons have the right to declare bankruptcy after meeting the statutory requirements.
The following types of insolvency proceedings are conducted in Poland:
KIELTYKA GLADKOWSKI helps its Clients initiate bankruptcy proceedings.
The courts of the Member State in whose territory the center of the debtor’s main interests is located have jurisdiction to open insolvency proceedings.
The main center of core business is the place where the debtor regularly manages its economic activities and which is recognizable to third parties.
In the case of a company or a legal person, it is presumed that the place of business is the seat specified in the articles of association.
In the case of a natural person conducting business activity, the presumption establishes the principal place of business as the center of the debtor’s core business.
For other natural persons, this is generally the place of residence.
If the debtor has the center of his main interests in the territory of a Member State, the courts of another Member State have the power to open insolvency proceedings only if the debtor has an establishment in the territory of that other Member State. However, such proceedings may be initiated when there are no obstacles to do so. This procedure is called secondary insolvency proceedings.
The opening of insolvency proceedings is without prejudice to the creditor’s right to set-off his claims against the debtor’s claims, if such set-off is permitted under the law applicable to the claims of the insolvent debtor.
The opening of insolvency proceedings against the buyer of an asset shall not affect the seller’s rights under retention of title if the asset is located in the territory of a Member State other than that of the opening of the proceedings at the time the proceedings are opened.
KIELTYKA GLADKOWSKI prepares recommendations and reports on whether the Polish court will have jurisdiction in given proceedings.
KIELTYKA GLADKOWSKI prepares and submits appeals against the initiation of bankruptcy proceedings in the absence of competent court jurisdiction.
KIELTYKA GLADKOWSKI draws up and submits complaints against paid legal transactions inconsistent with Polish law.
The effectiveness of these activities may be questioned if such activities concern:
– real estate,
– a ship or aircraft registered in a public register,
– securities whose existence requires an entry in the register specified by law.
KIELTYKA GLADKOWSKI submits claims of its Clients in main insolvency proceedings.
KIELTYKA GLADKOWSKI draws up and submits applications for recognition of a decision opening insolvency proceedings issued by a court of a Member State.
Such a request may be made after the decision has taken effect in the Member State where the proceedings are instituted.
Each Member State may refuse to recognize insolvency proceedings opened in another Member State or to enforce a judgment rendered therein, where such recognition or enforcement would lead to a result which is manifestly contrary to its public policy, in particular its fundamental principles or its constitutionally guaranteed individual rights and freedoms.
Under Polish law, the tasks of an administrator may be performed by
a trustee, a court supervisor, an administrator, an arrangement supervisor, a temporary court supervisor, a temporary administrator and a compulsory administrator.
The insolvency practitioner may exercise in the territory of another Member State all the powers conferred on it by the law of the State of the opening of proceedings, as long as no other insolvency proceedings have been opened in that other Member State or any counter-protective measure has been taken. The administrator is also entitled to challenge legal transactions in accordance with the interests of creditors.
When exercising his powers, the administrator is obliged to comply with the law of the Member State in whose territory he intends to act, in particular the rules on how to liquidate assets.
The appointment of an insolvency practitioner is evidenced by a certified copy of the decision by which he was appointed or by another certificate issued by the court having jurisdiction.
KIELTYKA GLADKOWSKI draws up and submits complaints against decisions on the appointment of an administrator in bankruptcy proceedings.
It may happen that the court appoints a person as administrator who has doubts that he will perform his duties properly, to the benefit of creditors, then KIELTYKA GLADKOWSKI prepares and submits appropriate pleadings to the court.
KIELTYKA GLADKOWSKI prepares and submits requests for information from the bankruptcy register.
Member States shall establish and maintain one or more registers in their territory where information on insolvency proceedings is published. The information shall be published immediately after the initiation of such proceedings. Bankruptcy registers can be combined.
KIELTYKA GLADKOWSKI prepares and submits applications for the initiation of secondary bankruptcy proceedings.
Such an application can be made when a court has recognized a decision to open insolvency proceedings in another Member State after certain conditions have been met.
One of such premises in Polish law is the debtor’s insolvency, which is not checked again when considering the above application.
In order to avoid the opening of secondary insolvency proceedings, the insolvency practitioner in the main insolvency proceedings may provide, in respect of assets located in a Member State where secondary insolvency proceedings could be opened, a unilateral undertaking that, when distributing those assets or the proceeds from their liquidation, they will respect the allocation and ranking rules under national law that creditors would have had if secondary insolvency proceedings had been opened in that Member State.
KIELTYKA GLADKOWSKI prepares and submits letters and applications aimed at responding to Clients who are creditors about the administrator’s obligation.
The insolvency practitioner in the main insolvency proceedings and the insolvency practitioner or insolvency practitioners in the secondary insolvency proceedings of the same debtor shall cooperate with each other, provided that such cooperation is not contrary to the rules applicable to those particular proceedings. Collaboration can take any form.
As part of the cooperation, the administrators:
(a) exchange as soon as possible any information that may be relevant to the other proceedings, in particular the progress of the lodging and verification of claims and any measures aimed at the recovery or restructuring of the debtor or the termination of the proceedings, provided that appropriate steps are taken to protect confidential information;
(b) analyze the possibility of restructuring the debtor and, where such a possibility exists, coordinate the development and implementation of a restructuring plan;
(c) coordinate the management of the liquidation or use of the debtor’s assets and affairs; the insolvency practitioner in the secondary insolvency proceedings shall give the insolvency practitioner in the main insolvency proceedings the opportunity to submit proposals for the liquidation or use of the assets in the secondary insolvency proceedings in a timely manner.
Where insolvency proceedings relate to two or more members of a group of companies, the insolvency practitioner appointed in the insolvency proceedings of one member of the group shall cooperate with any insolvency practitioner appointed in the insolvency proceedings of another member of the same group, insofar as such cooperation is appropriate to facilitate the effective conduct of those proceedings, is not inconsistent with the rules applicable to them and does not give rise to a conflict of interest.
KIELTYKA GLADKOWSKI submits claims of its Clients in secondary bankruptcy proceedings
This action is undertaken by sending an individual notification, informing in particular about the deadlines to be observed, the consequences of not meeting them, the authorities or institutions competent to accept claims and other activities provided for. The notification shall also specify whether preferential creditors or creditors whose claims are secured in kind must report their claims.
KIELTYKA GLADKOWSKI draws up and submits complaints against the suspension of the asset liquidation process.
Such a request may be submitted by the administrator.
The provision does not specify the conditions when the court may grant such a request. It only specifies the premise of its disregard. This is the case where the stay is manifestly not in the interest of the creditors of the main insolvency proceedings.
However, the court may require the insolvency practitioner in the main insolvency proceedings to take all appropriate steps to ensure the protection of the interests of the creditors in the secondary insolvency proceedings as well as of individual groups of creditors.
The court may suspend the liquidation process for a period not exceeding three months. It may be extended or reordered each time for the same period.
The court revokes the suspension of the liquidation of assets in the following cases:
(a) at the request of the insolvency practitioner in the main insolvency proceedings;
(b) ex officio, at the request of a creditor or at the request of the insolvency practitioner in secondary insolvency proceedings, if it turns out that the measure is no longer justified, in particular in the interests of the creditors of the main or secondary insolvency proceedings.
The insolvency practitioner in the main insolvency proceedings is entitled to propose a restructuring plan as a means of terminating the proceedings under Polish law.
KIELTYKA GLADKOWSKI draws up and submits appeals against the transformation of secondary insolvency proceedings into other insolvency proceedings under Polish law.
KIELTYKA GLADKOWSKI prepares opinions on the benefits of the above applications for the creditors.
The insolvency practitioner may make such a request for conversion of secondary insolvency proceedings if the conditions under national law for opening this other type of procedure are met and if this other type of procedure is the most appropriate for the interests of local creditors and for maintaining consistency between the main and secondary insolvency proceedings.
Such a request may be unfavourable to creditors, therefore KIELTYKA GLADKOWSKI provides assistance in such situations.
Managers’ cooperation
Where insolvency proceedings relate to two or more members of a group of companies, the insolvency practitioner appointed in the insolvency proceedings of one member of the group shall cooperate with any insolvency practitioner appointed in the insolvency proceedings of another member of the same group, insofar as such cooperation is appropriate to facilitate the effective conduct of those proceedings, is not inconsistent with the rules applicable to them and does not give rise to a conflict of interest.
Cooperation of courts
Where insolvency proceedings relate to two or more members of a group of companies, the court initiating such proceedings shall cooperate with any other court with which an application has been made to open proceedings concerning another member of the same group or which has opened such proceedings, provided that such cooperation is appropriate to facilitate the effective conduct of these proceedings, is not inconsistent with the provisions applicable to them and does not give rise to a conflict of interest. For this purpose, courts may appoint an independent person or body to carry out their instructions, where appropriate, provided that this is not contrary to the rules applicable to them.
KIELTYKA GLADKOWSKI draws up and submits complaints against decisions to initiate group coordination proceedings.
Such proceedings may be requested by the insolvency practitioner at any court having jurisdiction over the insolvency proceedings of any group member.
KIELTYKA GLADKOWSKI prepares and submits applications for the appointment of a specific person as a coordinator.
The coordinator must be a person authorized under the law of a Member State to act as administrator in insolvency proceedings. The manager cannot be the coordinator.
Coordinator:
(a) develops and submits recommendations for the coordinated conduct of insolvency proceedings;
(b) proposes a group coordination plan that identifies, describes and recommends a comprehensive set of measures to take collective action to end the failure of group members. In particular, the plan may include proposals for:
KIELTYKA GLADKOWSKI draws up and submits complaints against decisions on the appointment of a coordinator.
It may happen that the court appoints a person as a coordinator whom it has doubts that will perform its duties properly, for the benefit of creditors, then KIELTYKA GLADKOWSKI prepares and submits an appropriate pleading or application to the court.
