In a European comparison, Latvian insolvency law is interesting for the self-employed and employees who can work locally flexibly and for pensioners, as it leaves a debtor with 70% of his income in the insolvency proceedings.
The term for insolvency proceedings in Germany is 3 years.
During this time, a debtor transfers his attachable income to a trustee. Section 850c of the Code of Civil Procedure determines how much money remains for a debtor to live on. The garnishment exemption limit mentioned there determines the statutory subsistence level. This amounts to EUR 1,179.99 (2021) per month. This increases under certain conditions.
At the end of the insolvency proceedings, the German court can grant the discharge of residual debt.
In Latvia, the duration of insolvency proceedings ranges from 6 months to 3 years.
A term of less than 3 years can be considered if the creditors fail to register their claims in the debtor’s insolvency proceedings. In such cases, the insolvency proceedings can be ended after 6 months.
In Latvia, a debtor has more than just a subsistence level to live on during the insolvency proceedings. 70% of the income remains with him, no matter how high it is. Only 30% has to be paid to the creditors.
The insolvency procedure in Latvia is uncomplicated, debtor-friendly and is mainly carried out in a written procedure, a personal appearance before a court is then not necessary.
In order to successfully go through insolvency proceedings in Latvia, the debtor’s center of life must be in Latvia at least 6 months before filing for insolvency. This requires the actual move to Latvia, registration there and the commencement of economic activity. Since Latvia is a member of the EU, this is straightforward and easy. However, moving to Latvia does not mean that a debtor has to be constantly present during the procedure. Travel to family and work-related absences are generally not a problem.
Such a step still needs to be carefully considered.
Only if all the requirements for the implementation of insolvency proceedings are also demonstrably fulfilled can it be guaranteed that the discharge of residual debt granted there is to be recognized by the creditors and cannot be challenged.
It is absolutely not advisable to get involved in so-called “arrangements” and to only pretend to relocate the center of your life.
Good preparation and competent support from lawyers experienced in insolvency law in Germany and Latvia will help you to successfully complete such a procedure and achieve the goal of debt relief.
The support provided by the lawyers involved is also provided in Latvia in German or English. It is not necessary to learn the Latvian language.
After the successful completion of the insolvency proceedings, the residual debt is discharged.
The discharge of residual debt granted by a court in Latvia is to be recognized immediately within the European Union and is effective immediately.
If you need help with enforcement , we will support you with follow-up care. You can fall back on the experience of the lawyers when enforcing your rights.
