Legal Differences Between Concordat and Bankruptcy Postponement
Concordat Legal Processes and Requirements
It is inevitable for businesses facing financial difficulties to seek legal solutions. You can visit https://www.skhukukdanismanlik.com/icra-ve-iflas-hukuku/ for more information about concordat. In Turkey, there are two important legal tools that businesses can resort to in order to overcome financial crises. This process allows them to continue their transactions and debts, while showing a change in the legal landscape. A concordat is a process where the debtor restructures its debts by reaching an agreement with its creditors. In this process, the debtor company undertakes to pay its debts within a certain plan and tries to improve its financial situation by obtaining the approval of its creditors. A concordat allows it to continue its operations and offers a solution before bankruptcy.
Creditor and Debtor Rights with Concordat
For a concordat to be declared, debtors must apply to the court and present their financial information in detail. For the application to be accepted, it must be proven that they have payment details but are temporarily facing difficulties. When evaluating the application, the court considers the concordat plan and the debtor's financial recovery strategy. For the bankruptcy office, the application is made within the scope of the debtor's possibility of bankruptcy. The debtor must present a plan that will improve financial efficiency and can request the court to temporarily suspend the termination proceedings. During the concordat process, creditors can accept or reject the payment plan offered by the debtors. In case of acceptance, the creditors' debts change according to their desired terms. This process is regulated according to the regime of rights of both creditors and debtors. The debtor company continues to pay its debts while continuing its operations during the concordat process. In the bankruptcy office process, the rights of creditors are protected for an extensive period. The debtor individual or company finds the opportunity to pay its debts if the request for bankruptcy annulment is accepted. Creditors, while providing the debtor with financial capacity, also secure their receivables.
