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Corporate Insolvency Law

Republic of Lithuania Enterprise Bankruptcy law establishes two independent terms: bankruptcy and insolvency. Bankruptcy is the equivalent of an insolvent state enterprises, when bankruptcy proceedings has been initiated in or out of the court. Thus, the insolvency is one of the conditions for posing bankruptcy proceedings. Insolvency is a state of the enterprise when it fails to comply with its obligations (does not repay debts, perform a pre-paid contracts, etc.) and the overdue liabilities (debt, unfinished work, etc.) are more than half of the net book value of the assets.
As the company becomes insolvent and the court recognizes the state of the company, it is clear that the company will not be able to fulfill all of its proprietary obligations or will not be able to fulfill them on time. For these reasons it is necessary to take measures to better protect the interests of persons involved in proprietary relations of the company and to ensure that their loses related to insolvency of the company would be minimal or at all avoided.
Bankruptcy Institute is intended to protect the insolvent debtor and creditor rights and legitimate interests. Bankruptcy procedure is designed to meet the interests of all creditors, with that purpose publicating insolvent debtors debts and financial resources to cover them, allowing all the creditors to satisfy their proprietary obligations to the failing firm's property.
iLAW services related to corporate insolvency:
  • consultations on bankruptcy and restructuring initiation;
  • preparing statements concerning the bankruptcy proceedings;
  • representation of the companies in bankruptcy proceedings;
  • representation in creditors' meetings and committees;
  • risputing the transactions of a failing company;
  • bankruptcy administrator actions appeal.