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Restructuring and insolvency law in Elliniko - which is part of the greater Athens area - follows Greek national insolvency legislation and EU insolvency rules where applicable. The legal framework aims to provide mechanisms for financially distressed businesses and individuals to reorganize their debts, preserve value where possible, or, where reorganization is not feasible, to orderly liquidate assets and distribute proceeds to creditors. Common procedures include informal out-of-court workouts, preventative restructuring plans, formal restructuring under court supervision, and liquidation or bankruptcy processes. Proceedings are handled by the competent courts and insolvency practitioners in the Athens judicial district, and tax and social security authorities play a central role in many cases because of the priority of their claims.
Restructuring and insolvency cases involve technical procedures, strict deadlines, and significant legal and financial consequences. You may need a lawyer when you face any of the following situations:
- Your company cannot meet its payments and creditors are starting enforcement actions such as seizures or auctions. A lawyer can evaluate options and seek stays or interim protection where available.
- Lenders or suppliers have threatened foreclosure on secured assets, or banks have accelerated loans. Legal representation is often needed to negotiate forbearance or restructure credit facilities.
- You want to explore a preventative restructuring plan to avoid formal insolvency. Lawyers prepare plans, advise on creditor classes and voting, and represent you in court if a protective filing is required.
- You are a creditor seeking to protect your claims, participate in creditor meetings, or challenge a restructuring proposal. A lawyer will advise on claim filing, voting strategy, and enforcement.
- You are a director or officer worried about personal liability, clawback claims, or potential criminal exposure linked to corporate insolvency. Early legal advice can limit risk and shape strategic decisions.
- You are an individual with overwhelming personal debts and need advice about debt settlement options, personal bankruptcy pathways, or negotiating with tax and social security authorities.
- Your case has cross-border elements - for example creditors or assets in other EU states - and you need counsel versed in EU insolvency coordination rules and international enforcement.
The key legal instruments and practical features you should know about when dealing with restructuring and insolvency in Elliniko include the following general points. These items summarize practical realities rather than every statutory detail.
- Primary legislative framework: Greek insolvency law sets out procedures for preventative restructuring - a framework intended to help viable debtors reorganize before they become insolvent - as well as formal restructuring and liquidation. The law also provides for proceedings applicable to natural persons with over-indebtedness.
- Preventative restructuring vs formal insolvency: Preventative restructuring aims to permit businesses to restructure debts with creditor approval while avoiding the stigma and restrictions of formal insolvency. Formal insolvency or liquidation will follow if restructuring is not feasible or agreed.
- Court supervision and insolvency practitioners: Formal restructuring and liquidation proceedings are supervised by the courts. The court appoints insolvency administrators or trustees to manage the estate, assess claims, and run creditor meetings. Insolvency practitioners can be accountants or lawyers with the statutory qualifications.
- Creditor voting and plan confirmation: Restructuring plans typically require approval by classes of creditors. The rules set out how claims are grouped into classes and how majority thresholds are calculated. Courts can sometimes confirm a plan despite dissenting classes if statutory conditions for cram-down are met.
- Priority of claims: The law provides a ranking of claims. Secured creditors generally have priority over collateral and can realize security subject to procedural rules. Employees, social security contributions and certain tax claims often receive preferential treatment under the statute. The precise ranking and any caps are matters of statutory detail and case law.
- Automatic stays and enforcement: Depending on the procedure used, there may be a stay or suspension of enforcement actions to give the debtor breathing room for negotiations or the court-supervised process. The scope and duration of such protections vary with the chosen route.
- Out-of-court workouts: Informal negotiations and voluntary compositions remain common. These can be faster and less costly than formal procedures but rely on creditor cooperation and careful documentation to be effective.
- Cross-border rules: EU insolvency regulation principles apply to cases with foreign elements. If assets or creditors are in other EU countries, coordination with foreign courts may be needed under applicable EU rules.
- Tax and social security enforcement: Greek tax authority procedures and social security claims are highly relevant because those bodies are major creditors and enjoy particular enforcement powers. Engaging with tax and social security authorities early is crucial.
- Directors obligations and potential liability: Directors must act in accordance with statutory duties. Late or improper conduct when a company is illiquid can trigger directors’ liability actions by creditors, administrators or public authorities. Timely legal advice is recommended to navigate duties and possible defenses.
Gather up-to-date financial information - cash flow, bank statements, loans, creditor list, employee liabilities and tax filings. Contact a lawyer experienced in insolvency to evaluate options - informal negotiations, a preventative restructuring plan, or filing for court protection. Avoid transferring assets or taking actions that could later be challenged as prejudicial to creditors.
There are mechanisms that can limit or delay enforcement - for example by negotiating stays or seeking court-ordered protection in restructuring proceedings. The availability and duration of enforcement suspension depend on the chosen procedure and the facts. A lawyer can advise on immediate defensive steps and emergency filings.
A preventative restructuring plan is an out-of-court or court-assisted process intended to restructure a debtor’s obligations before formal insolvency. It is appropriate when a business has a viable going-concern prospect if debt burdens are adjusted. The plan must be feasible, value-preserving, and acceptable to sufficient creditor classes to be implemented.
Timelines vary widely. Informal negotiations can take weeks to months. Court-supervised restructuring can take several months to more than a year, depending on complexity, creditor opposition and litigation. Liquidation can also take many months or years, particularly if asset sales and creditor claims are contested.
Not necessarily. Outcomes depend on the procedure, the nature of your assets and whether assets are secured. Secured creditors may realize specific collateral. Certain procedures allow the business or individual to retain assets essential for continued operation or rehabilitation. A lawyer can explain asset protections and likely outcomes based on your circumstances.
Directors may face personal liability in certain circumstances - for example if they continue trading wrongfully while insolvent, engage in fraudulent behavior, or breach statutory duties. Early assessment by counsel helps directors take protective steps and document decisions to reduce personal risk.
Costs include legal fees, insolvency practitioner fees, court fees and administrative expenses. Costs depend on the procedure, estate size and complexity. In many cases a restructuring that preserves value will be more cost-effective than protracted liquidation, but there are always fees and administrative costs to consider.
Claims are ranked by statutory priority. Secured creditors are usually paid from secured assets, while unsecured creditors share remaining assets according to the statutory order. Priority categories can include employee claims, social security and tax claims. Exact ranking and payment amounts depend on the estate and applicable law.
You can negotiate directly, and many successful informal workouts begin with direct discussions. However, banks and major creditors expect clear proposals and legal documentation. A lawyer or restructuring adviser improves the likelihood of disciplined negotiations and helps draft enforceable agreements.
Cross-border insolvency issues add complexity. EU rules provide for judicial cooperation and determine jurisdiction in many cases. You will likely need advisers who understand both Greek insolvency practice and the laws of the other jurisdictions involved to coordinate filings and creditor claims.
When you need more information or institutional support, the following bodies and organizations are relevant to restructuring and insolvency matters in Elliniko and Greece:
- Ministry of Justice - responsible for judicial policy and oversight of insolvency courts.
- Independent Authority for Public Revenue - local tax authority handling tax claims and enforcement matters.
- Social Security Funds and the Single Social Security Entity - creditors for social contribution claims.
- Athens Court of First Instance - Commercial Division - the competent court for many corporate insolvency matters in the Athens judicial district that includes Elliniko.
- Hellenic Financial Stability Fund and banking supervisory authorities - relevant where banking claims or system stability issues arise.
- General Commercial Registry - GEMI - for company filings, registrations and public notices concerning corporate structure.
- Athens Bar Association - a resource for finding qualified local lawyers and verifying professional standing.
- Professional associations of insolvency practitioners, accountants and restructuring advisers - these associations can help locate practitioners experienced in complex restructurings.
- European Commission insolvency and second chance resources - for guidance on EU-level rules and best practice approaches to debt relief and business rescue.
If you believe you need legal assistance for restructuring or insolvency in Elliniko, follow these practical steps to proceed efficiently:
- Assemble documentation - prepare recent financial statements, bank accounts, loan agreements, security documents, tax filings, payroll records and a list of creditors with contact details and claim amounts. This information lets a lawyer give realistic advice quickly.
- Schedule an initial consultation with a lawyer experienced in Greek restructuring and insolvency law. Seek an attorney who practices in the Athens judicial district and who can explain options in plain language. Ask about relevant experience, typical outcomes and fee structure.
- Consider immediate protective measures - your lawyer can identify urgent actions to pause enforcement, preserve assets and prevent harmful transactions while you evaluate options.
- Evaluate restructuring alternatives - work with your adviser to compare informal workout, preventative restructuring plans, and formal court processes. Consider cost, timing and likely creditor responses.
- Communicate with key stakeholders - once a strategy is chosen, coordinate communications with major creditors, employees and, where appropriate, tax and social security authorities to avoid surprises and to build support.
- Prepare and file necessary documents - if a court process is required, your lawyer will prepare petitions, restructuring plans, schedules of claims and other filings and will handle court appearances and creditor meetings.
- Monitor progress and adapt - restructuring and insolvency processes often require adjustments. Maintain close contact with your adviser, provide updated information promptly and be prepared to revise proposals based on creditor feedback or court directions.
Remember that restructuring and insolvency are time-sensitive areas where early, informed action increases the chance of a positive outcome. This guide provides a starting point but it is not a substitute for personalized legal advice. Contact a qualified local lawyer to discuss your specific situation and next steps in Elliniko.
