Out-of-court settlement involves an agreement being reached between the debtor and their creditors without the involvement of a court. Such settlements are contracts under private law.
In general, these rules also apply to entrepreneurs from EU Member States in Austria.
- No court fees are incurred.
- There is no public announcement of the company's insolvency.
It is possible to negotiate out-of-court settlement up until 60 days after the company becomes insolvent or excessively indebted.
Companies must submit an application for institution of insolvency proceedings no later than 60 days after becoming insolvent or excessively indebted, if no settlement is reached.
- It is also possible to reach a settlement before the company actually becomes insolvent.
- If the company only has a small number of creditors, it is preferable to arrange a face-to-face meeting – in particular with the main creditor – and set down the results in writing. If a company has a large number of creditors, a generic letter can be sent to all of them.
Responsible for the content: Federal Ministry of Justice