Best Bankruptcy Lawyers in Marijampolė

About Bankruptcy Law in Marijampolė, Republic of Lithuania

Bankruptcy in Lithuania is a court-supervised process designed to deal with insolvency - the situation where a person or a company cannot meet its debts when due or liabilities exceed assets. In Marijampolė, cases follow national Lithuanian law and are handled by the competent courts that serve the Marijampolė region. Individuals use personal bankruptcy proceedings to reorganize and discharge debt under a court-approved plan. Companies use insolvency procedures to either restructure viable businesses or liquidate those that cannot be saved. Licensed insolvency administrators manage the process under court oversight, while creditors exercise rights through meetings and voting rules set by law.

Although procedures are national, practical aspects are local. Your case will involve local courts, creditors, bailiffs, and administrators who operate in or around Marijampolė. Understanding how the rules apply in this locality helps you plan realistically, meet deadlines, and protect your rights.

Why You May Need a Lawyer

Bankruptcy law is technical, deadline driven, and evidence based. A lawyer can assess whether bankruptcy is suitable, which procedure fits your situation, and what timing best protects your assets and income. For individuals, a lawyer can help prepare the petition, draft a feasible repayment plan, claim exemptions, and respond to creditor objections. For companies, counsel advises directors on their duty to act promptly once insolvency appears, evaluates restructuring feasibility, negotiates with key creditors, and manages the risks of personal liability for late filing or improper payments.

Common situations where legal help is critical include looming enforcement by a bailiff, wage garnishment or bank account seizure, threatened termination of essential contracts, disputes over secured collateral, cross border debts, tax and social insurance arrears, and potential director liability. Early advice often opens alternatives to bankruptcy, such as negotiated standstills, debt restructuring, or mediation, which may preserve value and reduce costs.

Local Laws Overview

Bankruptcy and restructuring in Marijampolė follow Lithuanian national legislation. For companies, the Law on Insolvency of Legal Entities sets the framework for both restructuring and bankruptcy. It defines insolvency tests, director duties to act without undue delay, the appointment and oversight of insolvency administrators, creditor classes, voting thresholds, moratorium effects, and claim priorities. For individuals, the Law on Bankruptcy of Natural Persons provides a court led process to consolidate debts, protect essential income and assets, and discharge eligible residual debts after successful completion of a repayment plan.

Courts with jurisdiction over the Marijampolė region handle filings and hearings. Corporate insolvency matters are typically heard by the regional court competent for Marijampolė, while personal bankruptcy cases are usually brought in the local district court where the debtor resides. On acceptance of a case, most individual and corporate enforcement actions are stayed, giving breathing space while a plan is proposed or liquidation is organized.

Key legal points that often matter in practice include the following. An automatic or court ordered moratorium can stop bailiff actions and freeze interest accrual on unsecured claims. Secured creditors retain rights over collateral but are subject to procedural rules and stay periods. Administrative and court costs are paid as priority expenses. From collateral proceeds, secured creditors are paid first, then remaining assets are distributed to other creditors in a statutory order that typically favors employee claims and public dues before general unsecured creditors. Individuals keep a portion of their income needed for basic living and can claim exemptions for essential household items as defined by law. After a successful plan, honest debtors can obtain a discharge of eligible residual debts. Certain debts, such as child support, criminal penalties, and other public interest obligations, are generally non dischargeable.

Insolvency administrators are licensed and supervised by the national authority responsible for audit, accounting, property valuation, and insolvency management. Public notices and case information are published through state maintained registers and the court information system. Directors of companies must avoid preferential or detrimental payments once the company is insolvent and should seek advice early to mitigate personal exposure.

Frequently Asked Questions

What is the difference between bankruptcy and restructuring for companies?

Restructuring aims to rescue a viable company by adjusting debts and operations under a plan approved by creditors and the court. Bankruptcy is the liquidation of a company that cannot be saved, with assets realized and distributed to creditors according to legal priorities. Both procedures are governed by the Law on Insolvency of Legal Entities, but they have different goals and tools.

How long does personal bankruptcy take in Lithuania?

The duration depends on your situation and the plan approved by the court. For honest debtors, the repayment plan period is often around three years. In specific circumstances, such as misconduct or complex cases, the plan period can be longer. Once you complete the plan, eligible residual debts may be discharged.

Will filing stop wage garnishment and bailiff enforcement?

Yes, once the court accepts your bankruptcy or restructuring case, enforcement actions by bailiffs are generally stayed. This provides temporary protection while a plan is negotiated or assets are administered. Secured creditors and certain claims may have limited exceptions defined by law.

Can I keep my home and essential property?

Individuals can claim statutory exemptions for essential household items and a portion of income needed for basic living. Whether you can keep your home depends on factors such as whether it is pledged as collateral, the value of the property, family circumstances, and the content of your plan. A lawyer can help you assess options, including negotiating with secured creditors.

What happens to company directors in bankruptcy?

Directors must act promptly when insolvency arises. If they delay filing or make payments that harm creditors, they risk personal liability and other legal consequences. During insolvency, directors cooperate with the administrator and provide information. In restructuring, existing management may continue operating under supervision if the plan provides for it.

How are creditors paid in order of priority?

Administrative costs and court approved expenses are paid first. Secured creditors are paid from the proceeds of their collateral. After that, remaining assets are distributed according to statutory priorities, which commonly place employee claims and certain public dues ahead of general unsecured creditors. Any remaining unsecured claims share pro rata.

What debts are not discharged in personal bankruptcy?

As a rule, obligations such as child support and maintenance, criminal penalties and fines, and certain damages linked to intentional wrongdoing are not dischargeable. Tax and public law claims may have special treatment. The exact list depends on Lithuanian law and the court order in your case.

Which court will handle my case in Marijampolė?

Corporate insolvency cases related to Marijampolė based entities are typically heard by the regional court competent for the area. Personal bankruptcy cases are usually filed in the district court of the debtor’s residence, which for residents of Marijampolė will be the local district court. A lawyer will confirm the correct venue before filing.

What documents do I need to start a case?

Expect to provide identification, a full list of creditors and debts, contracts and security documents, bank statements, income and expense details, asset listings and valuations, tax and social insurance information, and any ongoing litigation or enforcement records. Companies also prepare financial statements, cash flow forecasts, and corporate governance documents.

How much does it cost to file?

Costs include court fees and the remuneration of the insolvency administrator set or approved by the court. Individuals may need to pay a deposit toward administrative costs. Total expenses vary with case complexity. If you qualify for state guaranteed legal aid, some legal representation costs can be covered or reduced.

Additional Resources

Audit, Accounting, Property Valuation and Insolvency Management Authority - the national body that licenses and supervises insolvency administrators and issues guidance on insolvency practice.

Centre of Registers - maintains public registers where corporate data and many insolvency related notices are published.

State Guaranteed Legal Aid Service - provides primary and secondary legal aid to eligible individuals based on income and other criteria.

State Tax Inspectorate and State Social Insurance Fund Board - key public creditors for tax and social insurance debts, often involved in insolvency plans and settlements.

Courts serving the Marijampolė region - local district court for personal bankruptcy filings and the competent regional court for corporate insolvency matters.

Bailiffs operating in Marijampolė - enforcement officers whose actions are stayed once the court accepts an insolvency case, subject to legal exceptions.

Next Steps

Clarify your goals and timeline. Decide whether you seek protection from enforcement, a structured repayment plan, business rescue, or an orderly wind down. Early clarity shapes the legal strategy.

Gather documentation. Collect debts and creditor contact details, income and expense records, asset lists, contracts, security documents, and any court or bailiff papers. Organized records accelerate filing and reduce costs.

Consult a local lawyer. Speak with a bankruptcy and restructuring lawyer familiar with Marijampolė practice. They will assess eligibility, choose the appropriate procedure, and map critical deadlines to protect you from enforcement and liability.

Engage an insolvency administrator. Your lawyer will coordinate with a licensed administrator, a mandatory participant who manages the process under court supervision.

Consider alternatives before filing. Explore negotiated standstills, payment schedules, refinancing, or restructuring outside court. If these are not viable, proceed to prepare and file the petition promptly.

Follow the plan and court instructions. Attend hearings and creditor meetings, provide information on time, and comply with income contribution and reporting obligations. For individuals, completing the plan is the path to discharge. For companies, diligent execution maximizes value and reduces risk for management.

This guide provides general information about bankruptcy in Marijampolė, Republic of Lithuania. For advice on your specific situation, seek professional legal counsel.