Auteur
Sylwester Żydowicz

Sylwester Żydowicz, MRICS

Associé

Read More
Auteur
Sylwester Żydowicz

Sylwester Żydowicz, MRICS

Associé

Read More

17 avril 2020

COVID-19 insolvency emergency measures in Poland

  • QUICK READ

New amendments to Polish bankruptcy law were recently introduced through the so-called Shield 2.0 legislation. According to the Insolvency Law Act, an insolvency motion must be submitted within 30 days from the day on which the grounds to declare bankruptcy occurred.

Shield 2.0 sets out exceptions from this principle, provided that two conditions are met:

  • The grounds to declare insolvency of the debtor must have arisen during the period of an epidemic state of emergency or a state of epidemic declared due to COVID-19. The former state was in force from 14 March, and the latter replaced it from the 20 March. Therefore, the act will apply retroactively from 14 March.
  • The state of insolvency must have occurred due to COVID-19. This is combined with the presumption that, during the period of the mentioned states, the insolvency occurred because of COVID-19.

Should these conditions be met, the 30 day period for filing a motion for declaring insolvency does not commence; if it had already started, it is interrupted. It will run anew at the end of the indicated states.

In this situation, the periods used to calculate when an insolvency filing must be made have been extended by the number of days between the actual day of filing a motion and the last day on which the motion should have been filed pursuant to the usual rules of the Insolvency Law Act.

This particularly affects scenarios where a debtor distributes assets in the form of donations, as once the debtor declares bankruptcy, these donations become ineffective towards the creditor.

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