FINLAND Law and Practice Contributed by: Timo Lehtimäki, Niklas Thibblin, Essi Hietaoja and Oona Honkamaa, Waselius
turing ( varhainen saneerausmenettely ) and reg - ular company restructuring ( perusmuotoinen saneerausmenettely ). Regular company restructuring aims to evaluate whether the business has a reasonable possibil - ity of and sufficient resources for carrying on, and, if so, to rehabilitate the company’s viable business, ensure its continued viability and make arrangements with creditors (eg, debt haircuts, extension of payment schedules). The objective of early company restructuring, meanwhile, is to prevent potential insolvency. Bankruptcy Proceedings In bankruptcy proceedings, the process begins with a filing of a bankruptcy petition by the com - pany itself or a creditor. If the bankruptcy order is granted by the court, the court will appoint one or more external trustees (in Finland, practising lawyers serve in this role) to assume the control and management of the company in bankruptcy. In this case, the trustee manages the bankrupt company (the bankruptcy estate) during the bankruptcy proceedings. The court-appointed bankruptcy trustee will seize and liquidate all of the bankruptcy estate’s assets in a manner most favourable for the bankruptcy estate. The actual method of sale is decided by the bankruptcy trustee (who runs the day-to-day management of the bankruptcy estate) or is put to a vote at the meeting of credi - tors (who make certain major decisions by vote as set out in the Finnish Bankruptcy Act). A pledgee holding security over a movable asset (eg, shares, bank accounts or receivables), may generally enforce the security independently notwithstanding the bankruptcy proceedings, after notifying the bankruptcy trustee. The trus - tee may prohibit the independent enforcement if:
• the bankruptcy trustee decides to redeem the pledged asset from the pledgee at a price equal to the principal plus accrued interest of the pledgee’s secured claim; or • the trustee requests the court to impose a temporary moratorium of up to two months for the purpose of determining any lack of clarity in the secured creditor’s claim or pro - tecting the interests of the bankruptcy estate. A floating charge cannot be enforced separately from the bankruptcy. Company Restructuring In company restructuring, an order on the basis of a petition for company restructuring is filed by the company itself or a creditor. Company restructuring proceedings can be initiated even without the support of the debtor company if necessary to protect a material interest of the applicant creditor. If the company restructur - ing order is granted by the court, the court will appoint one or more external administrators (in Finland, practising lawyers serve in this role) to assume the control and oversight of the com - pany in restructuring; unlike in bankruptcy, the board of directors of the company stays in place, but with limited powers. The filing for regular company restructuring proceedings usually triggers a moratorium on enforcement against the debtor. The moratorium generally prohibits: • the enforcement of security; • the repayment and enforcement of debts that have fallen due before the commencement of the restructuring proceedings; and • the seizure of assets. The moratorium is in force until the company restructuring programme has been confirmed
76
CHAMBERS.COM
Powered by FlippingBook