Bullying Behavior Under Insolvency Law

During the current economic downturn the number of insolvency proceedings in the Czech Republic continuously increases. The insolvency legislation plays a key role in insolvency proceedings.

Given the tough conditions on the market, we are witnessing higher numbers of bullying insolvency petitions submitted against debtors.

Bullying behavior is a situation where a creditor submits an unjustified insolvency petition against the debtor. The purpose of such an unjustified petition is, in fact, not to solve the debtor's bankruptcy but a means for creditors to get their money back, to eliminate the debtor from the competition (e.g. a debtor cannot participate in public tenders) or to damage the debtor's reputation.