The COVID-19 pandemic is having a significant impact on the world economy, as businesses worldwide face liquidity problems and related insolvency risks. In order to shore up the Belgian economy, a slate of measures, primarily focused on liquidity, have already been adopted (e.g. the deferral of tax payments and social security contributions and a guarantee scheme for new loans).
Special Decree Nr. 15 now complements these measures with a statutory moratorium (the "Moratorium"), which temporarily protects companies against inter alia bankruptcy petitions and certain debt collection measures. The Moratorium is in line with initiatives taken by other EU Member States and runs from 24 April 2020 until (for now) 17 June 2020. The key features of the Moratorium are summarized in the table below.
Stan Brijs and Sophie Jacmain, partners in our Restructuring & Insolvency department, comment as follows on the Moratorium: "The statutory moratorium strikes a delicate balance. On the one hand, many companies simply cannot meet their payment obligations due to lack of revenue. Instead of forcing numerous companies to seek protection before the insolvency courts, this generally applicable and temporary statutory protection is straightforward and easy to implement. It is an additional measure, which is intended to provide a lifeline to companies, prevent job losses, and ensure business and economic continuity after the crisis. On the other hand the moratorium is not intended to keep artificially afloat companies that were already struggling before the COVID-19 crisis and prevents abuse by having the presidents of the business courts act as gatekeepers. In the same vein, it does not give businesses carte blanche to stop paying their creditors as it insists on the principle that due debts should still be paid."
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