Own bankruptcy filing of Dutch limited liability company (B.V.)
Whether through sheer bad luck, bad investments or other causes, sometimes bankruptcy seems inevitable. In some cases an almost inevitable bankruptcy can still be averted. If not, the question is how to file for bankruptcy of your limited liability company.
Getting timely advice
If you are in financial trouble, creditors threatening bankruptcy often hang over your business like dark clouds. But when do you pull the proverbial plug yourself? And why would you do that? What can you expect from the yet to be appointed trustee? What can your employees expect and what options are available for them? And also very important: how will bankruptcy affect you personally?
Our advice: don’t wait too long to seek help. When having obtained timely advice, you will be ready for bankruptcy in any form.
Is filing for bankruptcy the only option?
The first question that comes to mind when you think things aren’t working out is probably: is bankruptcy really the only option?
We find that entrepreneurs often think this to be the case. But our focus is always to help companies to prevent bankruptcy. Bankruptcy has a massive impact on everybody concerned, the company the shareholder(s), the employees and the director(s). It’s therefore eminent to investigate alternative options. We can help you with that.
Why file your own bankruptcy?
If it does turn out that bankruptcy is the last option, it can be beneficial to stay ahead of the creditors and file for bankruptcy yourself. This allows you to maintain a certain level of control over the course of events by, for example, being able to decide on the timing.
Most companies will hopefully never experience bankruptcy. But it’s always good to have some basic knowledge on this topic. Below we therefore address some commonly asked FAQs.
Do I need an attorney to file my own bankruptcy?
No: you don’t. In fact, Rechtspraak.nl has created a handy fill-in form especially for those who want to file for bankruptcy themselves.
Of course, it is advisable to have a lawyer assisting you with this process. Every bankruptcy is different and it is good to be reminded of the possible risks involved in this process.
As soon as a trustee is appointed, the entrepreneur loses control over the process and the company. A trustee will also look into the dealings of the director of the company prior to the bankruptcy. Therefore, pay close attention to issues such as payments just prior to bankruptcy (especially in case the shareholders decision to file for bankrupcy has already been taken) or entering into new agreements. A lawyer can help you with that.
What should I send what to where?
The above mentioned form explains step by step what information and documentation is required. Remember that you have to be able to prove that the company has “ceased to pay” and that there is more than one (due) claim against the company.
It is good to realize that if it states that something must be “original” (i.e. the shareholder register or the shareholders decision) this really means the original document. As such a color copy does not count as an original. When you fail to provide the requested orginal document, the court will declare the application inadmissible.
Ultimately, the complete form and attached documents must be filed in duplicate with the clerk (‘Centrale Balie‘) of the appropriate court. Fortunately, the court does not charge a court fee for the filing.
When will bankruptcy be declared?
The bankruptcy hearing takes place every Tuesday. Each court will differ as to exactly when the application must be in for a hearing the following Tuesday. In principle, it can be taken into account that if the application is received by the court before the weekend, the clerk’s office will pick the next Tuesday.
People are often surprised at the conduct of a bankruptcy hearing. In fact, this can be over within 3 minutes with the bankruptcy being declared on the spot. Thus, bankruptcy can often be arranged within a week.
And after the bankruptcy has been declared, how will things proceed?
The bankruptcy of Dutch limited (B.V.) and its consequences take effect from 0:00 a.m. of the day of the decision by the court. The bankruptcy is published in the Official Gazette (Staatscourant) and the Central Insolvency Register (Centraal Insolventieregister) and is therefore public.
From the date of bankruptcy, the ins and outs of the BV is completely in the hands of the trustee (a lawyer appointed by the court) and the entire assets of the company are “frozen”. The director of the company will from now on have a lot of dealings with the appointed trustee.
The trustee will request to obtain all the company’s records, fire the staff, make arrangements with the bank and ask you a lot of questions during the bankruptcy process. When everything is settled, the bankruptcy will be closed. This process can sometimes take years.
If you have any further questions/comments after reading the above. Then please contact us. We’re happy to assist you.
 Of course, this does often differ from a bankruptcy hearing where the bankruptcy was filed by a creditor.