SWITZERLAND Law and Practice Contributed by: Urs Hoffmann-Nowotny, Marcel Jakob and Benno Strub, Schellenberg Wittmer Ltd
Schellenberg Wittmer Ltd Löwenstrasse 19 P.O. Box 2201
8021 Zurich Switzerland
Tel: +41 44 215 5252 Fax: +41 44 215 5200 Email: zurich@swlegal.ch Web: www.swlegal.com
1. Overview of Legal and Regulatory System for Insolvency/Restructuring/ Liquidation 1.1 Legal Framework Insolvency and restructuring proceedings of Swiss companies and other legal entities (partnerships, asso - ciations, foundations, etc), as well as debt enforce - ment proceedings against them, are all regulated by the Swiss Federal Debt Enforcement and Bankruptcy Act (DEBA). In addition, numerous other Swiss laws contain provisions relating to insolvency, restructuring and liquidation, such as the Civil Code (CC), the Code of Obligations (CO), the Private International Law Act (PILA) and the Banking Act. The CO is particularly rel - evant with regard to triggering the obligation of cor - porate bodies to initiate restructuring measures or to report over-indebtedness to the insolvency court. Swiss insolvency proceedings are initiated either by the creditors or by the debtor itself. In both cases, the insolvency proceedings must be opened by the competent court, which is normally the court at the debtor’s domicile. Unlike legal entities, individuals (except for sole pro - prietorships or members of a partnership) cannot be forced into insolvency proceedings by a creditor. They can, however, apply for insolvency proceedings to be opened against themselves, thereby allowing their liabilities to be restructured and/or their entire assets to be liquidated. If they do not do so, individual assets will instead be seized and liquidated to pay the rel - evant debts.
In addition, the Commercial Register must take action if a company has organisational deficiencies (eg, it lacks the required corporate bodies). If the deficien - cies are not remedied, the company will ultimately be dissolved and, in the event of over-indebtedness, bankruptcy proceedings will be initiated. Regarding voluntary liquidation, see 5.1 The Different Types of Liquidation Procedure . 1.2 Types of Insolvency Insolvency of a Swiss legal entity leads to either bank - ruptcy ( Konkurs ), which will end with the liquidation of the entity, or composition proceedings ( Nachlass- verfahren ), which start with a composition morato - rium ( Nachlassstundung ) and will end either with the restructuring of the entity (lifting of moratorium), with a composition agreement ( Nachlassvertrag ) or with bankruptcy. The proceedings can be initiated either voluntarily by the debtor himself or involuntarily by a creditor of the debtor. 1.3 Statutory Officers In Swiss insolvency proceedings, depending on whether it is a bankruptcy or composition procedure, different statutory officers and bodies are involved, each with different roles in the various proceedings. 1. Courts and Judges The judges responsible for opening bankruptcy or composition proceedings and for further decisions in these two types of proceedings are part of the bank - ruptcy court ( Konkursgericht ) or composition court
438 CHAMBERS.COM
Powered by FlippingBook