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Insolvency · Recovery

Judicial reorganization

For businesses worth saving — a viable plan for returning to profit, negotiated with creditors and approved by the court.

Judicial reorganization is the main procedure for saving an insolvent company, governed by Romanian Law 85/2014. It is triggered at the request of either the debtor or the creditors, and allows the business to be restructured under the supervision of the syndic judge and the judicial administrator.

The reorganization plan may provide for: debt restructuring (rescheduling, write-downs, conversion), business reorganization (spin-off, merger, asset transfers), changes to the capital structure, or a combination of these. The plan must be approved by the creditors and confirmed by the syndic judge.

Throughout the reorganization, the company continues operating — employees stay, ongoing contracts are protected, and the debtor has a real chance of exiting insolvency with a healthy financial structure. The maximum duration of the plan is 3 years, with the possibility of extension.

Why this procedure
  • The company keeps operating throughout the procedure
  • Protection from creditors for the duration of the plan
  • Possibility of partial debt write-off
  • Exit from insolvency with a restructured balance sheet
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Frequently asked questions
How long does judicial reorganization take?
The reorganization plan runs for a maximum of 3 years from confirmation by the syndic judge, with the possibility of a one-year extension under Romanian Law 85/2014. Added to this is the observation period, during which the company’s situation is analyzed and the plan is proposed.
Can the company still operate during reorganization?
Yes — that is the very purpose of the procedure. The business continues under the supervision of the judicial administrator, ongoing contracts are protected by law, employees stay, and the debtor usually retains the right to manage the business, unless the court has withdrawn it.
What happens if the reorganization plan fails?
If the debtor does not comply with the plan or it can no longer be carried out, the syndic judge orders the transition to bankruptcy. That is why the plan must be built realistically, on the basis of a solid economic and financial analysis — not just optimistic on paper.