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Bankruptcy protection for Belgian enterprises

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30/12/2020

The law of 20 December 2020 (published on 24 December 2020) creates temporary protection for Belgian enterprises facing insolvency as a consequence of the COVID-19 crisis.

The protection currently lasts until 31 January 2021 but this can be extended, and entails for qualifying enterprises that:

  • they cannot be declared bankrupt or put into forced liquidation,
  • creditors will not be able to levy attachment on movable assets and or enforce certain security interests on certain types of collateral, and;
  • creditors will not be able to terminate existing agreements for reason of a payment default.

Importantly, the moratorium does not exempt directors of their potential liability. Directors should therefore seek legal advice on their director duties and associated liability risks.