Insolvency proceedings are an integral part of
business-commercial activities, in circumstances whereby a person
or corporation might need to institute proceedings to rehabilitate
its business activities or even to liquidate the company.
Insolvency reflects a factual situation in which a debtor
(person or corporation) encounters economic and cash flow
difficulties to the extent that the debtor is incapable of paying
its debts to creditors on time.
Insolvency proceedings seek to implement a fair and proper
distribution of the remaining resources of the debtor (person or
corporation) among the various creditors; during insolvency
proceedings, the court considers the creditors' different
interests, including maximizing the disposition of the debtor's
resources; ensuring proper employment of the business'
employees; minimizing the burden on the public taxpayers; taking
care of the business' customers; taking care of suppliers
that are dependent upon the business
