Once bankruptcy has been declared by the court, the collective liquidation procedure opens under the supervision of the cantonal supervisory authority. The bankruptcy administration takes charge of the asset inventory, the call to creditors, the collocation of claims and the realisation of assets. PBM Avocats represents creditors, debtors and interested third parties at each stage of this complex procedure, from its offices in Geneva and Lausanne.
The Inventory and Initial Protective Measures
As soon as bankruptcy is opened, the bankruptcy office proceeds with the inventory of the debtor's assets (art. 221 DEBA): enumeration of all movable and immovable assets, claims and rights, as well as debts. The debtor is required to actively cooperate and provide all necessary information (art. 222 DEBA); refusal to cooperate may constitute a criminal offence (art. 163 SCC).
Immediate protective measures are taken by the office: affixing of seals, freezing of bank accounts, notification to third-party debtors (debtors of the bankrupt, employers, etc.) not to make payments directly to the bankrupt debtor. The officers of the bankrupt company lose their powers of representation from the pronouncement of the judgment.
The Call to Creditors and Filing of Claims (art. 232 DEBA)
The call to creditors is published in the Swiss Official Gazette of Commerce (SOGC) and in the cantonal official gazettes (art. 232 DEBA). It invites creditors to file their claims within the period set by the bankruptcy administration (generally one month). Each creditor must indicate the amount of their claim, its cause, any security they hold and attach supporting documents.
Secured creditors (mortgages, movable pledges) are treated separately: they are satisfied in priority from the realisation proceeds of the encumbered asset, before any distribution to unsecured creditors. Creditors who do not file within the ordinary period may still be admitted, but they are served after punctual creditors.
The Collocation Schedule and Creditor Classes (art. 219 DEBA)
On the basis of filed claims, the bankruptcy administration establishes the collocation schedule (art. 244 DEBA). This document lists all admitted, rejected or contested claims and assigns them a priority class under art. 219 DEBA:
- 1st class: workers' claims for wages for the last six months, holiday pay, claims arising from a profit-sharing scheme and other claims arising from the employment contract;
- 2nd class: OASI, DI, loss of earnings and unemployment insurance contributions due by the employer for the last twenty-four months;
- 3rd class: all other unsecured claims (suppliers, lenders, ordinary creditors).
Creditors of a lower class are only satisfied if creditors of higher classes have been paid in full. In practice, in the vast majority of bankruptcies, 3rd class creditors receive nothing or a very small proportion.
Ordinary Liquidation and Summary Liquidation
The procedure follows the route of ordinary liquidation (art. 221 et seq. DEBA) when the assets appear sufficient to cover the liquidation costs or when a creditor agrees to advance those costs. A bankruptcy administration is appointed, generally composed of specialist professionals. It is responsible for realising the assets: public auction or private sale of movable assets (art. 256 DEBA), realisation of properties (art. 261 et seq. DEBA), recovery of claims.
If the assets appear insufficient to cover the costs of ordinary liquidation, the court may order summary liquidation (art. 231 DEBA), which is more expeditious. The bankruptcy office directly realises the available assets, without forming a special administration or a formal call to creditors. Summary liquidation is communicated by publication in the SOGC.
PBM Avocats intervenes to represent a creditor in the collocation procedure, contest a decision of the bankruptcy administration, defend the interests of directors under challenge, or advise potential acquirers of assets from the bankruptcy estate.
Frequently Asked Questions on the Course of Bankruptcy Proceedings
What is the difference between ordinary liquidation and summary liquidation?
Ordinary liquidation (art. 221 et seq. DEBA) applies when the active estate is presumed sufficient to cover the liquidation costs or when a creditor advances the necessary costs. It involves the appointment of a three-member bankruptcy administration, a call to creditors, preparation of a complete inventory, proof of claims and realisation of assets by auction or private sale. Summary liquidation (art. 231 DEBA) applies when the assets do not appear sufficient to cover the costs; it is faster and less expensive.
What are the deadlines for filing a claim?
The call to creditors is published in the SOGC and in the cantonal official gazettes (art. 232 DEBA). The period for filing a claim is generally one month from publication (period set by the bankruptcy administration). This period is a forfeiture period: creditors who do not file in time are in principle only admitted to the collocation schedule in the second class and after creditors who filed within the ordinary period. Late filings are possible under strict conditions.
How does the collocation schedule work?
The collocation schedule (art. 244 et seq. DEBA) is the document established by the bankruptcy administration that lists all filed claims and their priority class. The DEBA distinguishes three classes: 1st class (employment law claims: wages for the last 6 months, holiday pay, etc.); 2nd class (OASI/DI/loss of earnings/unemployment insurance contributions due by the employer); 3rd class (all other unsecured creditors). Secured creditors are satisfied outside the classes, from the realisation proceeds of the pledged asset.
Can the collocation schedule be contested?
Yes. Any creditor and the debtor themselves may contest the collocation schedule within 20 days following its consultation (art. 250 DEBA), by an action contesting the collocation schedule. The period is mandatory. The claimant may contest the admission of another creditor's claim (negative action) or the rejection of their own claim (positive action). The dispute is judged by the ordinary civil court.
Can acts performed before bankruptcy be set aside?
Yes. The DEBA provides for two mechanisms for attacking acts prior to bankruptcy: revocation (actio pauliana, art. 285 et seq. DEBA), which allows the annulment of acts performed during suspect periods before the opening of bankruptcy that harmed creditors (gifts within two years, disadvantageous acts for consideration within one year), and the absolute nullity provided for by art. 204 DEBA for acts subsequent to the opening. Periods and conditions vary depending on the type of act challenged.