Court-ordered debt restructurings are pronounced, if all other attempts to solve a debt problem have failed. Court-ordered debt restructuring schemes were introduced in December 1998 and are part of the Bankruptcy Act.
Debt restructurings are intended for private individuals and self-employed who can no longer meet their financial obligations. They can – under certain conditions – submit a request to have their debts restructured. The debtor pays back as much as he/she possibly can, according to a strict scheme and under supervision of a receiver. Under the Bankruptcy Act, creditors can be forced to cooperate. After a period of usually three years, the debtor can make a restart with a clean slate.
Legal debt repayment schemes can prevent private persons, with or without one-man businesses from being pursued on account of their debts for years on end.
