Treatment of a Security Interests Under the Insolvency Procedure
Polish insolvency procedure is mainly regulated by the Act on Bankruptcy from
- 2003.6 which was substantially amended by a new restructuring law of 15 May
- 2015.7 According to art. 10 of the Act on Bankruptcy if the debtor became insolvent, the court declares bankruptcy including liquidation of the debtor’s assets. Earlier, that is before the aforementioned reform, the court could declare also bankruptcy of the debtor with an option of an arrangement with creditors if there was substantial evidence that the creditor’s claims would be satisfied to a greater extent than would be in the case of liquidation of the debtor’s assets. After the reform this type of insolvency procedure was replaced by four new procedures including: (1) arrangement approval proceedings, (2) accelerated arrangement proceedings, (3) arrangement proceedings and (4) sanation proceedings. Nevertheless, since majority of cases concerns the liquidation of the debtor’s enterprise, all further considerations applies to this type of insolvency procedure.