Hamburg District Court

Apply for corporate insolvency

Prerequisites

• There is a reason to initiate corporate insolvency proceedings. The most common reason is insolvency. This means that the debtor can no longer pay their bills.
• As a debtor, you can also apply for the opening of corporate insolvency proceedings if it is foreseeable that you will soon become insolvent and will no longer be able to make payments.
• As a legal entity such as a limited liability company (GmbH), a stock corporation (AG), or an association, you are over-indebted. This is the case when your debts exceed your assets.
• There are enough assets (insolvency estate) to cover the costs of the proceedings.

Documents required

• Application form
• Completed hearing questionnaire if you are submitting a self-application (read the information sheet applicable to your case)
• If you submit a third-party application as a creditor, you also:
  • Substantiation of one's own claim against the debtor, for example by submitting judgments, enforcement orders or other documents from which the existence of the claim can be inferred.
  • Substantiation of the grounds for opening proceedings
• If applicable: Power of attorney

Please note

You are committing a criminal offense if you intentionally or negligently fail to file the application for opening proceedings in a timely manner.

The District Court does not provide legal advice. Please contact a lawyer or notary public.

The Public Legal Information Service (ÖRA) offers affordable legal advice for people with low incomes.

Corporate insolvency or consumer insolvency?

As a natural person, it is important for you to check whether you are classified as a business or as a consumer: Consumer insolvency proceedings can be carried out for consumers.

The requirements for consumer insolvency proceedings are:

• You are a natural person.
• Your business operations have ceased.
• You are not currently engaged in any independent economic activity or have not engaged in any such activity in the past.
• Although you have been self-employed in the past, your financial situation is manageable. This is the case if you have fewer than 20 creditors at the time of filing for insolvency.
• There are no claims against you arising from employment relationships. These are claims from the tax authorities for wage tax and claims from social security providers for contributions from former employees of the debtor.

You should ensure that you qualify as a consumer when filing with the insolvency court. To do so, you can credibly demonstrate the aforementioned requirements with appropriate documentation, such as a current plain-text bank statement from the tax office or a certificate from the social security provider regarding the nature of your arrears.

Deadlines

• As a member of the representative body of a legal entity, in the event of insolvency or over-indebtedness, file the application for opening of insolvency proceedings without culpable delay.


• File for insolvency no later than three weeks after you or the company become insolvent.


• File for insolvency no later than 6 weeks after you or the company become over-indebted.

Procedure

• If necessary, you should first contact a law firm, tax firm or debt counseling service for advice and support.
• File an application for insolvency proceedings with the relevant authority.
• If you are a natural person, you should consider simultaneously creating a
• to apply for discharge of residual debt.
• Submit the required documents.
• The responsible authority will review your application and documents. If necessary, they will request additional documents or information from you.
• The competent authority examines whether the future insolvency estate can finance the costs of the insolvency proceedings.
• If a valid application for corporate insolvency proceedings is submitted, the competent authority will appoint an expert and, in some cases, a provisional insolvency administrator.
• The competent authority will appoint a provisional creditors' committee if your company met at least two of the following three criteria in the previous financial year:
  • at least EUR 6,000,000 balance sheet total after deduction of any deficit shown on the assets side;
  • at least EUR 12,000,000 in sales revenue in the twelve months prior to the balance sheet date;
  • at least 50 employees on average per year.
• The insolvency court opens the corporate insolvency proceedings.
• The application may be withdrawn until the decision to open the proceedings takes effect.
• The debtor’s assets become what is known as the insolvency estate.
• The competent authority appoints an insolvency administrator who takes over the management of the assets and represents the interests of the creditors.
• The insolvency administrator ensures that all of the debtor’s assets are recorded.
• Possible steps:
  • Assets are identified and secured.
  • Transfers of assets prior to the proceedings (e.g., reclaiming inadmissible gifts) are reviewed.
  • Assets are sold.
• All creditors will be informed and can submit their claims to the insolvency administrator. If the claims are not disputed by the insolvency administrator, they will be entered into the insolvency schedule and taken into account in the distribution.
• The insolvency court sets a date for the first creditors' meeting. The creditors' meeting will decide on the further course of the proceedings, for example, the realization of assets or the preservation of a company.
• For companies, restructuring or continued operations can be considered, for example, through an insolvency plan that provides for an alternative solution such as restructuring. This can be submitted during the proceedings.
• The plan must be approved by creditors and the court.
• At the end of the insolvency proceedings, the proceeds from the insolvency estate are distributed equally among the creditors according to a predetermined order of priority. Priority claims, such as procedural costs, are paid first.
• As soon as the insolvency estate has been distributed, the proceedings will be terminated.
• In the case of corporate insolvencies, the insolvency administrator prepares a final report and applies for the deletion of the company if it is not continued.
• If a residual debt relief procedure (only for natural persons) has been successfully completed, the debtor will have his or her remaining debts forgiven upon completion.
  
  The exact procedure may vary depending on the individual situation and the decisions of the court or the parties involved.

Processing time

The processing time depends on the individual case.

Fees

The procedural fee is calculated based on the value of the insolvency estate. Additional costs arise from the appointment of the insolvency administrator and the commissioning of the expert opinion.




If you commission a law firm, tax firm or debt counseling agency to assist you in consumer insolvency proceedings, additional costs may arise.

Legal remedies

Immediate appeal

Legal basis

Section 2 Insolvency Code (Inso)


https://www.gesetze-im-internet.de/inso/__2.html


Section 3 of the Insolvency Code (Inso)


https://www.gesetze-im-internet.de/inso/__3.html


Sections 11-19 of the Insolvency Code (Inso)


https://www.gesetze-im-internet.de/inso/__11.html


§§ 723 - 728 German Civil Code (BGB)


https://www.gesetze-im-internet.de/bgb/__723.html


§ 23 Court Fees Act (GKG)


https://www.gesetze-im-internet.de/gkg_2004/__23.htm