Can companies afford bankruptcy?

👉 "The four plagues of Polish business" the pandemic, the Polish Deal, the war in Ukraine and the avalanche of cost increases have caused that the situation of small and individual businesses is very difficult. Most entities maintain negative assessments of the economic situation, and entrepreneurs are leaning towards pessimistic forecasts 📉

👉From a study conducted by Dziennik Gazeta Prawna reports that over two-thirds of micro and one-person enterprises indicated the uncertainty of the general economic situation as the source of their biggest problems. More than half complain about employment costs, the high burden on the state budget and unclear, inconsistent and unstable legislation.

👉As a result, more and more entrepreneurs are choosing to suspend their business. The DGP report shows that we currently have a record number and a record percentage of companies in history inactive – almost every seventh entrepreneur, and among micro entrepreneurs every sixth, has suspended its activity❌

👉Moreover, the absolute number of active JDGs remained at a similar level to the previous year, making it possible to speak of the biggest slowdown since the global financial crisis a decade ago ❗

These problems affect both small and large entrepreneurs and large companies.

February 1, 2023 The District Court in Rzeszów announced a bankruptcy decision Rzeszów Poultry Plant Res-Drob - informs portalspozywczy.pl. company problems there are also hidden private problems of its employees who are waiting for their salaries.

The nowiny24.pl portal reports that The company owes 267 people, while the debt already amounts to more than PLN 1.9 million. And it doesn't stop there either. "All Res-Drob employees have already received notice of termination of employment and by the end of March they will say goodbye to the company. (…) Another PLN 3 million will be needed to cover severance payments," says the trustee quoted by the portal. More information here.

In January 2024, the economic departments Polish courts announced 30 company bankruptcies. As far as restructuring is concerned, these have started in 359 companies. It is only the beginning of the year and the scale is beginning to be frightening.

In case of total number of company bankruptcies amounted to 408 proceedings last year. It should be noted here that 611 bankruptcy petitions were dismissed. Of the bankruptcies declared, the largest percentage (over 67%) were limited liability companies, followed by individual businesses (12%).

In such cases, it is important to, to consult the situation and do not submit applications to declare bankruptcy when, firstly, we know that the company does not have the capacity to go bankrupt and, secondly, the possibilities of other actions to get out of the crisis have not been analyzed. The actions towards companies at risk of insolvency, others towards insolvents.

Attention should also be paid to the liability of representatives for liabilities and the legal regulation of indemnification.

A thorough analysis of the crisis situation allows conclusions to be drawn and actions to be proposed.

Welcome to contact – we perform the analyses free of charge, and it is the entrepreneur who ultimately, after being presented with the recommendation, makes the decision, the conscious decision.