The Parliament of Lithuanian Republic has adopted amendments to the Law on the Insolvency of Legal Persons of the Republic of Lithuania on the effects of the coronavirus (COVID-19). The basis of that law includes, inter alia:
•During the quarantine period and for 3 months thereafter, the obligation of company managers to initiate company’s restructuring or bankruptcy proceedings, as well as out-of-court bankruptcy, has been suspended;
•During the quarantine period, the possibility for creditors to start insolvency proceedings against the debtor was restricted and the deadline for an agreement with the debtor without a trial was extended;
•Transactions which result in State aid granted to undertakings in respect of COVID-19 cannot be declared invalid;
•The cessation of the ongoing restructuring process of the company, in the event of a malfunctioning of the restructuring plan as a result of covid-19, has been suspended during the quarantine period and for 3 months thereafter.
The Chamber of insolvency Practitioners expected different regulation due to Covid-19, but we got different that proposal our was, but due to our impact to Insolvency Law amendents it became more strict comparing to initial project proposed by other parties.
Tomas Malinauskas is member of the European Insolvency Practitioners Association