What is bankruptcy?

"Tone, tone," - cried the debtor, dreaming of a very small piece of wood. Our humane court handed him the whole "log", in the form of bankruptcy. What is it and how it would help "a drowning man" bankrupt? The debtor company or its creditors go to court to recognize the company bankrupt. The court, relying on the signs of bankruptcy, the statement takes and gets it. While the process will proceed, the court appoints a bankruptcy procedure. They are only 5: surveillance, financial recovery, external control, the settlement agreement, the bankruptcy proceedings. They will help you understand the state of affairs of the debtor and to help if there is a chance for salvation. Types of procedures • observation. Appointed a temporary manager. The aim - to see the state of affairs, not a fake check whether the bankruptcy and to answer the question whether the company itself to repay. • financial improvement. Appointed administrative receiver. The aim - to put the company on its feet and repay debts according to a previously approved plan. Debtor are a number of concessions: Do not charge a penalty under the contracts, interest on debt, "drip" only at the rate securities, etc. • external control. Appointed external manager. All management of the debtor removed from management. The aim - to bring a company out of crisis and repay debts. "Manager" may take any measures that would fill up "treasure" of the debtor until the sale of the property. • the settlement agreement. "Amicable" agreement the debtor and creditor. For example, the debtor returns, it can. A lender accepts this and is no longer pursuing. Once the parties come to this agreement, the court shall dismiss the case of bankruptcy. • bankruptcy proceedings. The final stage. The debtor is declared bankrupt. Liquidated remains his, and all property sold. Note that in case of bankruptcy of a credit institution applies only to bankruptcy proceedings.