Bankruptcy Register Sealing and Rehabilitation in Switzerland
A bankruptcy in Switzerland represents a difficult ordeal for any person concerned, with consequences that persist well beyond the procedure itself. Registration in the bankruptcy register represents an administrative mark that can significantly impede the economic and social reintegration of the individuals affected. In response to this reality, Swiss law provides mechanisms for erasing these prejudicial traces: sealing of the bankruptcy register and rehabilitation. These distinct but complementary procedures offer a second chance to persons who have experienced financial difficulties. Our law firm regularly accompanies clients in these complex processes, requiring in-depth knowledge of the legal framework and the administrative practices specific to each canton.
Legal Basis for the Bankruptcy Register in Switzerland
The bankruptcy register in Switzerland finds its basis in the Federal Act on Debt Enforcement and Bankruptcy (DEBA/LP). This register, kept by cantonal enforcement and bankruptcy offices, lists all natural and legal persons who have been subject to bankruptcy proceedings. Its main objective is to ensure transparency in commercial relations and protect potential creditors.
According to article 8 DEBA/LP, any person may consult the registers and have extracts issued, provided they justify an interest. In practice, this interest condition is interpreted broadly, making this information relatively accessible. Entries in the bankruptcy register remain visible for 5 years, in accordance with article 8a DEBA/LP.
Consequences of Registration in the Register
Registration in the bankruptcy register creates several prejudicial consequences for the persons concerned:
- Difficulties obtaining credit or a mortgage loan
- Obstacles to renting accommodation
- Impediments to job searches in certain sectors
- Complications in creating a new business
- Negative impact on commercial relationships
Sealing Procedure for Bankruptcy Register Entries
Sealing of the bankruptcy register is an administrative measure allowing certain entries to be made invisible before the expiry of the legal 5-year period. This procedure finds its legal basis in article 8a paragraph 3 DEBA/LP, which provides that a third party may no longer consult the entry when three months have elapsed since the closure of the bankruptcy proceedings, if the debtor has paid all claims recorded in a certificate of loss in full.
Conditions Required for Sealing
To obtain the sealing of a bankruptcy register entry, several cumulative conditions must be met:
- The bankruptcy proceedings must be definitively closed
- A period of three months must have elapsed since that closure
- All claims recorded in certificates of loss must have been repaid in full
- A formal request must be addressed to the competent enforcement and bankruptcy office
Practical Steps to Obtain Sealing
The sealing procedure requires a methodical and rigorous approach:
- Identify all certificates of loss issued during the bankruptcy
- Contact each creditor to negotiate and make repayment
- Obtain receipts or payment attestations for each settled claim
- Compile a complete file with all supporting documents
- File a formal request with the enforcement and bankruptcy office
Rehabilitation After Bankruptcy in Swiss Law
Distinct from sealing, rehabilitation represents a judicial procedure aimed at retroactively erasing the legal effects of a bankruptcy. It is governed by articles 251 to 265 DEBA/LP and constitutes a more profound measure than simple administrative sealing.
Rehabilitation fully restores the bankrupt person in their rights, as if the bankruptcy had never been declared. It erases in particular the civil and professional incapacities that may result from a bankruptcy, such as the prohibition on practising certain regulated professions.
Conditions for Rehabilitation
To obtain rehabilitation, the debtor must demonstrate that:
- All debts recorded in the bankruptcy have been paid in full including capital, interest and costs
- A period of ten years has elapsed since the closure of the bankruptcy (alternative condition)
- The bankruptcy resulted from unfortunate circumstances and not from serious fault on the part of the debtor
Differences and Complementarity Between Sealing and Rehabilitation
| Criterion | Sealing (art. 8a DEBA) | Rehabilitation (art. 265a DEBA) |
|---|---|---|
| Nature | Administrative measure | Judicial procedure |
| Scope | Makes entry invisible to third parties | Legally erases the bankruptcy |
| Conditions | Full repayment + 3-month period | Full repayment or 10-year period |
| Competent authority | Enforcement office | Court |
| Effects | Limited to register consultation | Fully restores bankrupt's rights |
Frequently Asked Questions About Bankruptcy Register Sealing and Rehabilitation
What is the sealing of the bankruptcy register in Switzerland?
Sealing (art. 8a para. 3 DEBA/LP) is the erasure of a bankruptcy from the register before the ordinary 5-year period has elapsed. It is possible if the bankrupt has paid all their debts and costs in full, and the closure of the bankruptcy occurred at least 3 months ago. The enforcement office proceeds with the cancellation upon request, with proof of full payment.
What is the difference between sealing and rehabilitation?
Sealing (art. 8a DEBA/LP) is an administrative cancellation of the register following full repayment of debts — it may take place as early as 3 months after closure if all debts are settled. Judicial rehabilitation (art. 265a DEBA/LP) is a court decision erasing the effects of the bankruptcy — it may be granted after 5 years if the bankrupt has paid all their debts or benefited from a moratorium.
After how long does a bankruptcy automatically disappear from the register?
The bankruptcy is registered in the enforcement and bankruptcy register for 5 years. It disappears automatically after this period, even if the debts are not fully repaid. The certificates of loss (CDL) resulting from it, however, remain registered for 5 years as well and the claim may be pursued for 20 years.
How do I obtain the sealing of a bankruptcy in practice?
The sealing request is addressed to the competent enforcement office, accompanied by: 1) proof of payment of all claims in full (receipts from all creditors), 2) proof of payment of the procedure costs, 3) a certificate from the bankruptcy office that closure occurred at least 3 months ago. PBM Avocats accompanies this process in Geneva and Lausanne.
Does judicial rehabilitation erase all effects of the bankruptcy?
Judicial rehabilitation (art. 265a DEBA/LP) may be granted by the court 5 years after the closure of the bankruptcy, if all recognised claims have been paid or if a moratorium has been executed. It erases the legal effects of the bankruptcy in the register. CDLs already issued remain valid but their registration in the register may be cancelled if the corresponding debts have been paid.