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The bankruptcy moratorium ends on December 31, what will happen now?

From the Abencys office they inform us that the current bankruptcy moratorium ends this December 31st. With the expiration date approaching, speculation is beginning about the possibility of postponing, once again, the end of this extraordinary extension. Abencys foresees that, if a new extension is approved, it could have dire consequences for the companies affected in the following months.

In view of the number of competitions presented so far this year, it is evident that the bankruptcy moratorium is generating a sedative effect in companies in difficulties, plunging them into a false feeling that the decision on the measures to be adopted for the survival of the business can be postponed indefinitely, according to the office.

Along these lines, Manuel Gordillo, a partner at Abencys, is aware that when a company runs into difficulties it is not easy to take the measures necessary for their survival, but regrets that “the bankruptcy moratorium is not helping this end, but quite the contrary, artificially postponing the solution to the problem. Many companies in difficulties, which should have already faced difficult measures but necessary for their survival, continue to worsen their condition and move away from a solution ”.

In addition, Gordillo criticizes that “Requirements have not been established in the law to know which company can benefit from the moratorium, and which cannot”, in addition to that, as it is configured, “It sends the message that the contest is equal to liquidation and disappearance of the business, when it does not have to be like that, as long as it is attended in advance, with a clear objective and suitably advised.”

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Despite the increase in bankruptcy, many companies have taken advantage of the extension of bankruptcy moratorium, delaying the presentation of bankruptcy not being forced to do so. In this way, companies are increasingly recurring in the business fabric zombie that, in reality, although they appear active, they do not have the capacity to continue with their activity.

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