By the end of 2023
Buschmann wants to relax insolvency law
09/20/2022, 4:09 p.m
Because of the high energy costs for companies, Minister of Justice Buschmann wants to relax the obligation to file for insolvency law by the end of 2023. While the Greens agree to the FDP politician’s plans, the SPD wants a complete suspension in the event of over-indebtedness.
The easing of insolvency law announced by Federal Minister of Justice Marco Buschmann with a view to the looming over-indebtedness of companies due to high energy and raw material prices should apply until the end of next year. This provides for the draft of a change in the law that Buschmann’s ministry sent to the other ministries for approval. The planned simplification only affects the insolvency obligation in the event of over-indebtedness.
Companies are to be exempted from the obligation to submit an application if their continued existence is sufficiently probable for a period of four months – instead of the previous twelve months. However, there are further demands from the SPD to completely suspend the obligation to file for insolvency, as in the Corona crisis, in the event of insolvency or overindebtedness. “That helped many companies back then,” said SPD Vice-Chairman Dirk Wiese. “That needs to be done fairly quickly.”
Protection against energy price shock
The Greens backed Buschmann’s proposal. “Companies with a functioning business model must be protected from the energy price shock,” said their spokesman for economic policy, Dieter Janecek. “The proposal from the Federal Ministry of Justice to ease the obligation to file for insolvency due to over-indebtedness makes a lot of sense and must now be implemented quickly.” Regarding the schedule, the Ministry of Justice said that the cabinet referral was planned for the next few weeks. The ministry wants to speed up the decision-making process in the Bundestag by docking the amendment to an ongoing legislative process to abolish the property rights register. This should now also provide for an amendment to the Covid 19 Insolvency Suspension Act.
Insolvency administrators welcomed the changes planned by Buschmann. “It is helpful that politicians are now opening a ‘crisis protective shield procedure’,” explained Lucas Flöther from the Gravenbrucher circle of insolvency administrators. “The simplified access to self-administration and shortened forecast periods under insolvency law support effective and flexible restructuring of companies – and can offer an alternative to nationalization.”