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How do you decide whether to continue running your business during an insolvency proceeding?

Insolvency proceedings are intended to provide business owners with protection from creditors, with the aim that they will be able to repay their debts over time.

But how does this affect the business itself and the dealings with suppliers, and why is it advisable to seek the help of a lawyer who specializes in the subject?

Adv. Adi Rosenstein with the explanations

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• Insolvency

In conjunction with Legal Zap

Tuesday, 09 February 2021, 13:57

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In the video: Adv. Adi Rosenstein on insolvency proceedings for business owners (Walla! NEWS Studio)

Owning a business in Israel is a complex matter.

In the past year, following the Corona plague, many have found that this is already an almost impossible matter.

As a result of the situation, business owners all over the country got into debt and went into insolvency situations.

In order to understand this complex issue in depth, Adv. Adi Rosenstein came to the studio, explaining: "Insolvency proceedings are intended to give people who have fallen into debt of hundreds of thousands of shekels protection from their creditors, who will not file lawsuits against them or open enforcement cases. Their lives safely and without fear of being forfeited at any moment.

They are in some process, which in the end has a light at the end of the tunnel - the cancellation of most of the debts. "Is

this procedure intended for a particular person or the business itself?

" For a particular person.

If a company runs into difficulties, it goes through liquidation proceedings.

Bankruptcy and Insolvency

Proceedings Are

Intended For Individuals. ”

Is it possible to continue running the business during insolvency proceedings?

"It is possible, and even desirable, as long as they show that they do not create debts and that the business turnover is positive. For example, people with an authorized dealer or an exempt dealer, restaurant owners, a fast food business, etc. I have many customers who let them open a licensed dealer." "But start a business."

Is it possible to maintain a proper flow during the procedure and how is this done?

"As part of the procedure, it is obligatory to go to an accountant and submit the business balance every two months, to show that there is a profit left. During the procedure, it is not possible to use credit cards or checks, but you can manage your bank account and your spouse. "He needs to understand that the more profitable the business, the higher the monthly payment. Whoever makes money and makes a profit, should also return more each month."

When entering into a procedure, how is dealing with suppliers affected?

"You have to deal with suppliers in cash, because there is no credit and checks. This way it is not possible to create new debts. These restrictions can make it difficult for some businesses, but for many it makes a line arrangement, for the whole procedure itself."

Finally, how important is it to consult a lawyer who specializes in the field, so that he can provide professional advice?

"A lawyer will guide you throughout the process and from the very beginning will ask the questions that will help understand whether it is worth continuing to run the business or not, depending on profitability. I sit down with my clients and check it out, and make them orderly."

For more details on the website of

Adv. Adi Rosenstein

Phone 053-4271931

Article courtesy of Zap Legal The

information presented in the article does not constitute legal advice or a substitute for it and does not constitute a recommendation for taking proceedings or avoiding proceedings.

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