If things don't look as favorable as expected for a while, the specter of impending bankruptcy soon strikes the entrepreneurial heart.
You can apply for a moratorium with the court; this is a special form of moratorium. But when do you actually have this option?
When can you apply for suspension of payments?
This form of moratorium is not granted lightly. First of all, it must be proven that the financial problems are temporary and that you can solve them in the short term.
During this period of moratorium, the business owner cannot be forced to pay outstanding items, with a few exceptions. Priority claims and living expenses, for example, continue as usual.
How do you apply for a moratorium?
Suspension of payments must be filed with the court. As a business owner, you hire a lawyer, who writes a petition explaining your temporary financial problems. If you meet all the requirements, such a process is short-lived, as the moratorium is then granted provisionally without a hearing.
After a few months, you have to appear in court in person and creditors also get an invitation. All parties do their story and tell why a moratorium should or should not be granted. In the end, it comes down to the simple de-most-votes-money and you finally know whether your moratorium is final or not. It may also be the case that during those months of the preliminary moratorium, a debt agreement has been reached and more air will be available to the organization.
When does suspension of payments end?
The debt settlement covers unsecured creditors, but not preferential creditors, such as the UWV and the Tax Office, which almost always have to be satisfied. Creditors are offered a pro rata percentage of the claim, so everyone gets an equal slice of the pie. If at least ⅔ of the creditors accept the agreement, then a final moratorium is granted.
A moratorium ends when the entrepreneur himself is able to resume payments, but in practice, the moratorium is often still converted into bankruptcy because the organization continues to have liquidity problems and the company proves to be insufficiently solvent.
