Best Restructuring & Insolvency Lawyers in Gibraltar

About Restructuring & Insolvency Law in Gibraltar

Restructuring and insolvency law in Gibraltar governs the processes that allow financially distressed individuals, companies, and other entities to manage, reorganise, or wind up their affairs. Gibraltar, as a prominent international business centre, has a robust legal framework designed to balance the interests of debtors, creditors, and stakeholders. The jurisdiction offers several avenues for dealing with financial difficulties, such as company voluntary arrangements, administration, liquidation, and schemes of arrangement. The regulatory regime is influenced by English law but also includes local statutory provisions and procedural rules unique to Gibraltar.

Why You May Need a Lawyer

It is common to require specialist legal advice when facing financial distress, whether you are an individual, business owner, director, or creditor. You might need a lawyer if:

• Your business is struggling to pay its debts on time.
• You have received threats of legal action or insolvency proceedings from creditors.
• You are a director concerned about personal liabilities in insolvency situations.
• You are a creditor wishing to recover debts from an insolvent individual or company.
• Your company wishes to restructure its debts or negotiate with lenders or investors.
• You need to understand your rights and obligations in insolvency proceedings or want to prevent wrongful trading claims.
• You are interested in acquiring distressed assets or participating in an insolvency process as a bidder or investor.

A qualified lawyer will help you navigate the process, comply with local laws, develop effective strategies, and protect your interests.

Local Laws Overview

Gibraltar's restructuring and insolvency regime draws on the Companies Act 2014, Insolvency Act 2011, and various regulations adopted by the Gibraltar Parliament. Key aspects include:

• Company Voluntary Arrangements (CVAs): Allow financially troubled companies to reach binding agreements with creditors to repay debts over a set period.
• Administration: Enables an insolvency practitioner to take control of a company to save the business or achieve a better return for creditors than immediate liquidation.
• Liquidation (Winding Up): The process of bringing a company to an end, selling assets, and distributing proceeds to creditors. This can be voluntary or compulsory.
• Schemes of Arrangement: Formal court-approved agreements between a company and its creditors or members to reorganise affairs.
• Cross-Border Procedures: Gibraltar recognises certain foreign insolvency proceedings, subject to local law and public policy considerations.
• Directors' Duties: Directors must avoid wrongful trading and can be personally liable if they allow a company to trade while insolvent.
• Creditor Rights: Creditors have rights to petition for insolvency, lodge claims, and engage in the restructuring or liquidation process.

Gibraltar's legal system offers procedural safeguards for fair treatment and provides access to the Supreme Court of Gibraltar for dispute resolution and orders relating to insolvency.

Frequently Asked Questions

What is insolvency in Gibraltar?

Insolvency occurs when an individual or company cannot pay their debts as they fall due or when liabilities exceed assets. The law sets out specific processes for addressing insolvency, including administration and liquidation.

What options are available for companies in financial distress?

Companies can negotiate informal arrangements, enter into a Company Voluntary Arrangement, apply for administration, or wind up the business through liquidation. The best option depends on the specific circumstances and goals.

Who can start insolvency proceedings?

Insolvency proceedings can be initiated by the company, its directors, or creditors through formal application to the court or by passing relevant resolutions.

What happens to directors during insolvency?

Directors have a duty to act in the best interests of creditors and may face scrutiny over decisions made when the company was facing financial difficulty. They can be held personally liable for wrongful or fraudulent trading.

How are creditors treated in insolvency?

Creditors are ranked according to law, with secured creditors typically paid first, followed by preferential creditors (such as employees), unsecured creditors, and finally shareholders. Each class of creditor has certain rights throughout the process.

Can insolvency be avoided?

With early intervention, it may be possible to avoid insolvency through restructuring, negotiation with creditors, or formal arrangements like CVAs or schemes of arrangement.

What is the role of an insolvency practitioner?

Insolvency practitioners are licensed professionals who manage insolvency procedures, act as administrators or liquidators, and ensure fair treatment of creditors and compliance with the law.

Does Gibraltar recognise foreign insolvency proceedings?

Gibraltar may recognise and cooperate with certain foreign insolvency proceedings, but each case is subject to local law, the Supreme Court's approval, and considerations of public policy.

Will my personal assets be at risk if my company goes insolvent?

Generally, a company is a separate legal entity and directors or shareholders are not personally liable for company debts, unless personal guarantees are in place or there is evidence of wrongful or fraudulent trading.

How can I get help if I am owed money by a company in insolvency?

You can file a claim in the insolvency process and may participate in creditor meetings. A lawyer can advise on your status and the likelihood of recovery, and whether further action is warranted.

Additional Resources

• Supreme Court of Gibraltar: Handles all formal insolvency proceedings, including administration and liquidation cases.
• Gibraltar Financial Services Commission (GFSC): Regulates insolvency practitioners and financial services entities in Gibraltar.
• Companies House Gibraltar: Maintains official records of companies, including insolvency and winding up notifications.
• Local Bar and Legal Societies: Can refer individuals to qualified restructuring and insolvency lawyers.
• Government of Gibraltar - Business Support Services: Provides guidance for businesses in financial difficulty.

Next Steps

If you believe you need assistance with restructuring or insolvency in Gibraltar, consider taking the following steps:

• Gather all relevant financial documents, contracts, correspondence, and any communications with creditors or officials.
• Make a clear summary of your circumstances, including financial position, debts, and any urgent issues.
• Consult with a specialist restructuring and insolvency lawyer in Gibraltar to discuss your options and receive tailored legal advice.
• Follow the lawyer’s guidance on next steps, which may include negotiation with creditors, formal applications to the court, or involvement of an insolvency practitioner.
• Stay proactive and act promptly, as early intervention can significantly improve outcomes and maximise available options.

Professional legal advice is crucial for navigating the complexities of restructuring and insolvency law and safeguarding your interests in Gibraltar.