Best Restructuring & Insolvency Lawyers in Asunción

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Studio Panama Italia
Asunción, Paraguay

Founded in 1989
56 people in their team
Italian
Spanish
English
Studio Panama Italia stands as a beacon of comprehensive legal expertise in Panama, specializing in a wide array of services that include administrative law, business management consulting, immigration, real estate, and tax consulting. The firm's seasoned attorneys and consultants bring a wealth of...
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About Restructuring & Insolvency Law in Asunción, Paraguay

Restructuring and insolvency law in Asunción, Paraguay, governs the processes and legal procedures for companies and individuals facing financial distress. The main objective of these laws is to facilitate the orderly resolution of unpaid debts, protect creditors' rights, and, where possible, enable the recovery or rehabilitation of struggling businesses. In Paraguay, insolvency procedures are regulated by the Civil Code, the Commercial Code, and specific insolvency statutes. These frameworks set out mechanisms for initiating bankruptcy proceedings, restructuring debt, reaching agreements with creditors, and liquidating assets when necessary. Both individuals and businesses can seek relief or protection under these laws, aiming to balance the interests of debtors and creditors and promote financial stability.

Why You May Need a Lawyer

Navigating restructuring and insolvency situations can be complex and emotionally taxing. A lawyer with experience in this area can provide crucial support and guidance. Here are some common scenarios where legal assistance is essential:

  • Your business is facing severe financial difficulties and is unable to meet its obligations
  • You are an individual overwhelmed by personal debt and considering bankruptcy
  • You are a creditor concerned about recovering amounts owed by an insolvent debtor
  • You need to evaluate different restructuring options or negotiate with creditors
  • There are disputes regarding the distribution of assets or the priority of claims
  • You seek to avoid legal pitfalls, undue loss of assets, or liability risks
  • You require advice on protecting your interests or those of your stakeholders

A knowledgeable lawyer can help you understand your options, guide you through the legal process, represent you in court, and help secure the best possible outcome for your situation.

Local Laws Overview

In Asunción, Paraguay, restructuring and insolvency matters are primarily regulated by the Paraguayan Civil Code, the Commercial Code, and Law No. 154/1969 (Bankruptcy Law). Here are some key local law aspects to be aware of:

  • Types of Proceedings: Paraguayan law recognizes two main procedures: concurso preventivo (preventive arrangement) and quiebra (bankruptcy/liquidation). Preventive arrangements aim for debt restructuring, while bankruptcy focuses on liquidation of assets.
  • Initiation: Proceedings can be initiated by the debtor or creditors. Insolvency must be declared by a competent court, typically located in Asunción for companies based in the capital city.
  • Supervision: Bankruptcy proceedings are supervised by the court and an appointed trustee who manages the process of asset liquidation and creditor payments.
  • Creditor Claims: Creditors are classified in order of priority, and payments are distributed accordingly. Secured creditors and employees often have preferential rights.
  • Restructuring Options: Companies may negotiate a debt restructuring plan with creditors in order to regain solvency and continue operating.
  • Liquidation: If recovery is not feasible, assets are liquidated and proceeds are distributed among creditors.
  • Debtor Protections: Some protections may be available to debtors during proceedings, such as an automatic stay on creditor actions.

Because insolvency law involves a mix of statutes, court practices, and evolving case law, local professional guidance is strongly recommended.

Frequently Asked Questions

What is the difference between restructuring and bankruptcy in Paraguay?

Restructuring (concurso preventivo) aims to help debtors reach agreements with creditors and continue operating, while bankruptcy (quiebra) leads to liquidation of the debtor's assets and final distribution among creditors.

Who can file for insolvency in Asunción, Paraguay?

Both companies and individuals who are unable to meet their financial obligations can file for insolvency proceedings. Creditors can also initiate proceedings against debtors.

What happens to the assets of a bankrupt company?

Assets of a bankrupt company are collected and liquidated under court supervision, and the proceeds are distributed to creditors according to legal priorities.

How are creditors paid in insolvency proceedings?

Creditors are classified as secured, preferential, or unsecured. Secured and preferential creditors are paid before unsecured creditors, with employees and government authorities typically having priority.

Is it possible to avoid liquidation through restructuring?

Yes, if a restructuring plan is approved by the required majority of creditors and the court, liquidation may be avoided, allowing the debtor to continue operating and pay debts over time.

What role does the trustee (síndico) play in bankruptcy?

The trustee is appointed by the court to oversee the bankruptcy process, manage the debtor’s assets, represent the interests of creditors, and ensure proper legal procedures are followed.

What legal protections do debtors receive during insolvency?

Debtors may receive temporary protection from creditor actions, such as lawsuits and asset seizures, allowing negotiations or an orderly asset sale.

Can foreign creditors participate in Paraguayan insolvency proceedings?

Yes, foreign creditors can file claims and participate in the process, subject to the same rules and priorities as local creditors.

How long do insolvency proceedings typically take?

The duration varies depending on the complexity of the case, but proceedings can often extend from several months to several years.

What are the risks of going through insolvency without a lawyer?

Self-representation increases the risk of procedural mistakes, lost protection, unfavorable outcomes, and missed opportunities for effective negotiation with creditors.

Additional Resources

If you require further information or assistance, the following organizations can be helpful:

  • Supreme Court of Justice (Corte Suprema de Justicia) - Oversees courts handling insolvency cases, especially in Asunción
  • General Directorate of Registries (Dirección General de los Registros Públicos) - Handles records related to property and legal entities
  • National Bar Association of Paraguay (Colegio de Abogados del Paraguay) - Directory of licensed lawyers with expertise in restructuring and insolvency law
  • Chamber of Commerce and Industry of Paraguay (Cámara de Comercio y Servicios de Paraguay) - Resource for business consultation and legal guidance
  • Legal Aid Offices (Consultorios Jurídicos Gratuitos) - May offer free or low-cost legal advice to individuals facing insolvency

Next Steps

If you believe you need legal assistance regarding restructuring or insolvency in Asunción, Paraguay, take the following steps:

  1. Document your current financial situation, including all debts, assets, and income sources
  2. List any legal notices or correspondence received from creditors, courts, or public authorities
  3. Identify your goals, such as business recovery, debt settlement, or asset protection
  4. Consult a reputable Paraguayan lawyer or law firm with experience in restructuring and insolvency law
  5. Bring all relevant documents to your consultation to facilitate an accurate assessment
  6. Discuss possible legal strategies and the likely consequences of each option
  7. Follow your lawyer’s advice to protect your interests and comply with all legal requirements

Early professional advice can help you understand your rights and responsibilities, avoid costly errors, and achieve the most favorable result given your circumstances.

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Disclaimer:
The information provided on this page is for general informational purposes only and does not constitute legal advice. While we strive to ensure the accuracy and relevance of the content, legal information may change over time, and interpretations of the law can vary. You should always consult with a qualified legal professional for advice specific to your situation. We disclaim all liability for actions taken or not taken based on the content of this page. If you believe any information is incorrect or outdated, please contact us, and we will review and update it where appropriate.