There are situations in which a company cannot be saved from insolvency and bankruptcy, but before appealing to a definitive solution like this, a business owner can also try and restructure the company. Restructuring is used not only in cases like the above mentioned, but also when trying to improve the business capacity. Corporate restructuring can be defined as a reorganization of the company at various levels: legal, operational, or even at ownership ones.
In Malta, a company can be reorganized for various reasons, among which:
In most cases, the company will request the services of accountants in case of bankruptcy or Maltese lawyers in case of legal matters.
No matter the type of corporate restructuring a company is undergoing there are a two main steps to be taken in order to succeed. The first step implies performing due diligence on the company and then drafting a reorganization plan.
The Maltese Company Act also provides for business reorganization, but only if the company is facing financial liabilities. Under the law, there are two corporate restructuring options for Maltese companies:
Companies can file for the company recovery procedure with a Maltese court which provides the business some time before the creditor can take measures to recover any outstanding amounts. The compromise or arrangement is more of an agreement between the debtor and the creditor which applies to insolvent companies. In this case three quarters of the shareholders or creditors must approve the arrangement and file a petition with a local court.
You can also watch the video below on company restructuring in Malta:
Our Maltese law firm can assist companies facing difficulties by:
For complete information about the corporate restructuring services provided by our attorneys, do not hesitate to contact us anytime.
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