RE: Reconstruction = Bankruptcy ? Reorganization is a procedure where a legal person is considered to have a good business idea but have ended up in financial trouble. Company reconstructed without bankruptcy.
In Sweden controlled company reconstructions of a law that came into force on 1 September 1996.
A company that has financial difficulties can apply to the court for reorganization. The district court then appoints an administrator.
Reconstruction usually granted for a period of three months and may be renewed for up to three months at a time, but never more than twelve months.
Reconstruction usually granted for a period of three months and may be renewed for up to three months at a time, but never more than twelve months.
The administrator will make the assessment of the business is able to continue.
The administrator must also consider whether there are opportunities to meet with a financial settlement between the debtor (borrower) and creditors (creditors).
An application for reorganization shall contain:
1) A statement of the reasons for payment difficulties.
2) a description of how the company has thought operate in the future and how a settlement with creditors can be reached.
If an application is granted, the court also appoint an administrator. In special circumstances, more than one administrator is appointed.
The debtor is required to provide the administrator with any information about their financial circumstances of importance for the reconstruction of the business.
The debtor must follow reconstructor instructions on how business is done.