Preventive Concordat

The concordat is a mechanism for avoiding insolvency and consists of an agreement between debtor and creditor regarding the manner the debtor, in financial difficulty, will pay his debts.
The debtor must previously announce the creditors regarding his difficulties and the request a chance to solve his problems proposing a solid plan on this matter. The creditors must be convinced to accept the plan as well, about the fact they could recover the money in more advantageous conditions as in case of bankruptcy.
If this procedure fails, bankruptcy is initiated.

Objectively, the preventive concordat is an agreement concluded between the debtor, on the one hand,
and the creditors which hold at least two-thirds of the value of accepted and undisputed debts, on the other hand, by means of which the debtor proposes a recovery plan of his company and of payment of his debt to these creditors, and the creditors accept to support the efforts of the debtor to overcome the difficulties his company is going through.

Any debtor may request the procedure of preventive concordat, with certain exceptions foreseen
by the law, such as actions registered in the fiscal record or if against the debtor a bankruptcy
procedure was initiated 5 year previously to the offer of preventive concordat.