Schutzschirmverfahren

PROTECTIVE SHIELD PROCEEDINGS

A faster process with greater autonomy for the board of directors.
Protective shield proceedings were introduced a few years ago under Section 270b of the German Insolvency Code (InsO). As a judicial reorganisation process, they are another option provided for under modern insolvency law. During this form of proceedings, which are a modification of preliminary insolvency proceedings, the focus is on reorganising the company through debtor-in-possession managementby preparing an insolvency plan.
To compensate for the greater autonomy granted to the debtor company, strict conditions apply. In particular, one of the conditions is that action is taken in good time and that this is well prepared; moreover, this is subject to extensive documentation requirements. Our insolvency law specialists have in-depth expertise and extensive experience.
As with all our insolvency administration activities, we focus our attention on reorganising companies in a way which creates good future prospects. Our highly professional and dedicated approach means that we do everything we can to rescue the company, save jobs and satisfy the interests of creditors to the greatest extent possible.

What you need to know about protective shield proceedings

  • Requires an insolvency plan to be drawn up within a short space of time (maximum of three months) under the supervision of a custodian
  • The company may suggest a custodian of their choice to the court
  • The reorganisation takes place under debtor-in-possession management
  • Applications for protective shield proceedings can still be successful even in cases of over-indebtedness and imminent insolvency
  • The higher workload involved makes these proceedings most suitable for medium-sized and larger companies

Our services:

Our key services at a glance:

  • Preparing for and pre-structuring the process
  • Creating a reorganisation plan, including short-term and medium-term liquidity, revenue and HR planning
  • Issuing the statement that needs to be prepared by an independent third party experienced in insolvency law as required under Section 270b, Paragraph 1 of the German Insolvency Code (InsO)
  • Preparing internal and external communications
  • Identifying the management’s liability risks

Your benefits at a glance:

  • Your company’s board of directors largely retains control and the rights of disposal of the company assets
  • The board of directors has the right to suggest a custodian of its choice to the court
  • Advantageous in terms of public image because protective shield proceedings are perceived as taking place out of court and courts do not always publicly disclose the proceedings
  • The support of a custodian or (additional) chief restructuring officer (CRO) from one of Germany’s leading insolvency law firms
  • Transparent and professional communication to build trust among creditors, employees and, where applicable, the general public

JUST ONE OF THE ADVANTAGES OF THE PROTECTIVE SCREEN PROCEDURE: IT IS MOST OF THE TIME
NOT TAKEN AS AN INSOLVENCY PROCEDURE IN THE PUBLIC.

Selected clients

We have successfully overseen protective shield proceedings for a wide range of clients, including the following:

  • MWS-Gruppe
  • Drescher-Unternehmensgruppe (custodianship)