Insolvency in Eigenverwaltung

“Insolvency in Eigenverwaltung” (debtor-in-possession management under Sections 270 et seq. of the German Insolvency Code) means that the company is continued in insolvency proceedings by its own management instead of by an insolvency administrator. The insolvency court orders it at the debtor’s request and appoints an insolvency monitor (Sachwalter), who supervises management (Sections 270 et seq. InsO). Eigenverwaltung is one way of restructuring and reorganising a company when insolvency cannot be avoided, but the company still has a business worth continuing and positive prospects for the future. This form of insolvency allows the debtor to keep control of the company by retaining the power of disposal and control over its finances.

Unlike traditional insolvency proceedings, in which the management of the company is transferred to the insolvency administrator, the debtor remains in charge in Eigenverwaltung.