Reconstructor

A reconstructor is a person appointed by the bankruptcy court to be in charge of reconstruction proceedings, in the same way as a trustee in bankruptcy proceedings. However, the roles of the administrator and the trustee are not exactly the same. The administrator is not generally appointed to the company's management, which is often the case with a trustee.

The main task of the administrator is to look after the interests of the creditors of an insolvent company and ensure that the creditors get all or part of their money back, for example for missing payments.

The administrator, possibly in cooperation with an accounting expert (for example a state-authorized public accountant), may choose to file the company for bankruptcy if there are no other options to reduce the company's debt within a reasonable timeframe.

What is the role of the administrator?

The role and purpose of the administrator is to work with a company's creditors and the bankruptcy court to try and turn around the finances of a failing business.

The aim is to get the company back on track so that it can once again maintain healthy operations.

The administrator does not take over the management of the company, but must find and secure the company's assets so that they are not improperly used for other purposes.

The administrator is also responsible for assessing the reason why the company has ended up in a financial crisis. If the company's management has engaged in reprehensible behavior, the administrator should consider possible management liability and liability for damages.

Reconstruction is formerly known as suspension of payments

Few people know the word 'reconstruction' or 'reconstructionist', but most people know the term 'suspension of payments'. In the past, the term 'suspension of payments' was used when a company tried to pause its payments in an attempt to avoid bankruptcy.

Today, the term has been replaced by "reconstruction", which is now used to describe the process of saving a failing company.

The administrator is the person in charge of this process - possibly in collaboration with an accountant or other accounting expert.