German experience with reorganization in the frame of insolvency proceeding

Unitary insolvency proceeding was the core of insolvency code reformation, that has been in effect since 1991. This law replaced former bankruptcy code and compensation code. The pattern was set by American Chapter 11 US Bankruptcy codes. One of the main goals was to create legal system that would enable to reorganize companies in difficulties and so protect values and jobs. German insolvency law proposes in fact two reorganisation modes. Reorganization according to an insolvency plan and transferred reorganization (asset deals). Especially the transferred reorganization is very popular in practise because of quite fast process and risk and former burden elimination. Twenty years application of this legal regulation proved the insolvency code application in practise. The insolvency code provided many companies second chance. In spite of that, a critical approach is necessary as well as realisation of limits and problems that appear in practise. Two decades experience with companies' reorganization in Germany could be an inspiration for solving critical situations in Czech companies and for Czech insolvency law as well.