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Corporate restructuring is a court-approved measure suitable for all types of companies. Its purpose is to
In restructuring proceedings, a restructuring programme is drawn up for your company together with the creditors. The goal is to arrange the payment of your company’s debts and to avoid bankruptcy. The programme sets out what needs to be changed in your business operations and how your company’s debts are arranged.
There are different kinds of restructuring proceedings:
How the proceedings differ:
Early restructuring | Accelerated restructuring | Basic restructuring | |
|---|---|---|---|
Scope of difficulties | Threat of insolvency | Serious but still manageable payment difficulties | Insolvent |
Objective | Prevent insolvency | Launch corrective action quickly | Arrange debts and enable continued operations |
Applicant | Company itself | Most often company itself | Company itself or creditor |
Interdiction of debt collection | If necessary | If necessary | As soon as proceedings start |
You should apply for restructuring well in advance, as
Call the Yrittäjän talousapu counselling service when you want more information about corporate restructuring or to find out about your company’s possibility of applying for restructuring.
If a creditor decides to apply for the restructuring of the company, it
The creditor or creditors submit the application to the district court. The debtor company will then have the opportunity to express its views on the application.
After this, the district court makes a decision on initiating the restructuring proceedings.
You can find a more detailed process chart and general information in Finnish and Swedish on restructuring proceedings on the website of the Office of the Bankruptcy OmbudsmanOpens in a new window..
Process of basic and early restructuring proceedings:
Preliminary investigation of the financial situation
If you wish, you can have the company’s financial situation investigated by an external expert before submitting the application.
You can also review the resulting report with your company’s creditors, financiers and other key stakeholders.
Submitting a restructuring application
Prepare a free-form application that contains the basic details of the company. With your application, attach:
You can ask for help with making the restructuring application from your accountant, legal experts or the district court, for example.
Deliver the signed application and its appendices to the district courtOpens in a new window. in whose jurisdiction the debtor’s economic activities have been managed. To ensure security, it is recommended that the application is sent as message via the secure email of the Ministry of JusticeOpens in a new window..
If the district court decides that restructuring proceedings can be initiated, it
The administrator and the debtor company hold an initial negotiation to review the company’s
Based on the negotiation, the administrator makes an initial assessment of the situation and the necessary measures.
The administrator draws up a proposal for a restructuring programme with the company, the creditors and, if necessary, external specialists.
Once the creditors have approved the restructuring programme, the administrator submits it to the district court.
The district court approves the restructuring programme.
The company acts in accordance with the restructuring programme. The programme usually lasts for 5 to 10 years.
The restructuring ends when the company has fulfilled its obligations under the programme.
If the company is unable to fulfil its obligations, it is usually declared bankrupt.
You can find a more detailed process chart and general information in Finnish and Swedish on restructuring proceedings on the website of the Office of the Bankruptcy OmbudsmanOpens in a new window..
Process of accelerated restructuring proceedings:
The company negotiates restructuring plans with its major creditors. The creditors must approve the application for accelerated proceedings.
The company selects a person to prepare the restructuring and an auditor.
Once the creditors have approved the draft restructuring programme, the person drafting the restructuring submits an application to the District Court to initiate the proceedings.
If the district court decides that restructuring proceedings can be initiated, it
The company acts in accordance with the restructuring programme. The programme usually lasts for 5 to 10 years.
The restructuring ends when the company has fulfilled its obligations under the programme.
If the company is unable to fulfil its obligations, it is usually declared bankrupt.
After the restructuring programme ends, the company can continue to operate normally.
The company or administrator can request for the restructuring entry to be removed from the Trade Register and from the bankruptcy and corporate restructuring register. This often requires a final report by the administrator and proof that all the requirements of the programme have been met.
The entry in the company’s credit information is usually removed 2 years after the end of the programme if the company does not have new payment defaults.
The Finnish Tax Administration and other authorities are automatically notified of the end of the restructuring. The company can for example apply for re-entry to the prepayment register if it has been removed from it during restructuring.
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