Business is an unpredictable environment with its own nuances and ups and downs. All these unforeseen situations and crises can significantly affect your business, and sometimes it can lead to the situations when you are not able to pay your loan obligations.

The main reasons-catalysts of bankruptcy

Sometimes bankruptcy is the only way out from a situation. There are the most common reasons that cause such need:

• Unpredictable changes in the legal system that create difficulties for restructuring the business to new requirements.
• The fast increase in the competitive mass that leads to a great quantity of more resourceful opponents.
• Sharp decrease in demand for the products / services offered by the company, the offered products may become irrelevant, the appearance on the market of more functional analogues.
• Unforeseen crisis situations (for example, the corona virus pandemic).

Such vulnerabilities are very difficult to predict and create a strategy in advance. Sometimes this can lead to significant losses, and in severe cases it may lead to the bankruptcy of enterprises. Often, the main reason for bankruptcy is significant internal corporate disagreements regarding issues important to the company.

The preparatory phase

Before starting the procedure, it is necessary to analyze all available information and understand whether this will help in solving the current financial difficulties of the enterprise.

• The beginning of preparation of the enterprise for bankruptcy.
• Applying of an application to the commercial court.

Do you need bankruptcy proceedings?

In order to evaluate a possibility of bankruptcy, you should realize your capacity to cover all current expenses, including loan obligations and employee salaries. If there are debt obligations that you cannot handle on your own, it's time to consider that prospect.

Cooperating with competent lawyers, you can avoid additional difficulties and mistakes, get detailed advice and accompaniment at all stages, so it can save your time and money.

Like in every procedure, the most important step is preparation and proper knowledge. Legal consultation at this stage will give an opportunity to answer all questions of concern and to conduct a deep analysis of the structure of assets and liabilities and transactions that were made within the last 2 - 3 years. All this will help to develop holistic and effective strategy.

Filing an application to the Commercial Court

An application may be applied to the arbitration court by:

• Director (founder).
• Liquidation Commission.
• Creditor.

Working with the Tsentralny Okrug Law Firm, you will receive detailed advice and support at all stages. We will evaluate all the risks and your situation in detail and create the most effective strategy to get out of this situation. We have a vast geography of providing bankruptcy services. Our specialists accompany bankruptcy proceedings and provide services of arbitral receivers in Voronezh, Lipetsk, Belgorod, Moscow, Kursk and Tambov.

Author is Dmitry Prosvirin