My company is insolvent – what should I do?

Some tips to avoid disastrous bankruptcy!


At present, only over-indebtedness and a loss of capital on the balance sheet trigger the duty to act of the board of directors. The reform of the Code of Obligations now provides for the obligation to monitor solvency. Indeed, creditors only file for bankruptcy if they are not paid on time, regardless of the company’s lack of equity.

Although Swiss commercial law does not require the presentation of a cash flow statement, the lack of liquidity is the most important risk and the most common reason for the bankruptcy of a company. The board of directors is then obliged to act swiftly and take the necessary measures to ensure solvency, or even to propose reorganisation measures to the shareholders if such measures fall within the competence of the general meeting.

Among several possible measures, the legislator places particular emphasis on the possibility of applying for a debt-restructuring moratorium. It is indeed possible to apply for an instalment plan directly with the creditors whose debts cannot be discharged in time, or even to agree on a partial waiver of their claims. The debtor can apply to the judge for a debt-restructuring moratorium, provided that there are prospects of reorganisation or that the future approval of a composition agreement appears possible.

In this case it is important to be able to prove the reliable chances of the company’s survival, to reorganise the balance sheet in order to present the best situation to the creditors, but above all to be aware of the current financial situation.