Restructuring instruments of the bankruptcy code in Austria
By Mario Kapp, KAPP & STRIMITZER Rechtsanwälte GmbH
The successful and sustainable reorganisation of a company cannot be limited to the approval of a haircut by the creditors. In fact, the company must use the proper restructuring proceedings for its actions. In this regard, the Austrian Bankruptcy Act (IO) provides several substantive restructuring instruments.
- Bilateral contracts not completely fulfilled by the debtor or their contractual partner may be dissolved by the insolvency administrator (section 21 IO).
- Should the debtor be a lessee, the contract of lease may be terminated by the insolvency administrator or the landlord (section 23 IO). Only periods of notice and rules concerning the protection from unwarranted termination shall be observed.
- Should the bankrupt be an employer and the employment has already been entered into, then the Austrian Bankruptcy Act enables a beneficiary termination of redundant labour. The insolvency administrator may institute the termination observing the statutory period of notice, the period of notice fixed by a collective agreement, or a shorter period of notice agreed upon, taking statutory termination restrictions (section 25 IO) into consideration.
The bankruptcy and civil law offers numerous instruments to achieve sustained success and to manage a future
beneficial reorganisation for the creditors. A far-reaching analysis of the current status and a structural preparation of the appropriate restructuring instruments are imperative for achieving success.
Mario Kapp, Managing Partner
KAPP & STRIMITZER Rechtsanwälte GmbH, Graz-Seiersberg, Austria
T: +43 316 22 59 55
Mario Kapp is managing partner of KAPP & STRIMITZER Rechtsanwälte GmbH situated in Graz, Austria, which specialises in bankruptcy law, corporate law and business restructuring. Mario Kapp was the sole founder of the law firm in 2006.
Today, KAPP & STRIMITZER Rechtsanwälte GmbH has two partners and five lawyers as well as an outstanding reputation for bankruptcy law in Austria. The law firm is mainly focused on bankruptcy law, reorganisation law, company restructuring, commercial law, banking law, real estate law and international law. For further information, visit the homepage www.kapp.at.
published: October 2014