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Covid-19-Insolvency Suspension Act (Covinsag) Insolvency Filing by Creditors

As recently reported, the COVInsAG of 27 March 2020 suspends the obligation to file for insolvency for legal entities with limited liability pursuant to section 15a InsO and for associations in the event of insolvency caused by the COVID 19 pandemic until 30 September 2020.

Correspondingly, the filing for the initiation of insolvency applications by creditors regarding the assets of their debtors pursuant to section 14 InsO is also postponed for three months by COVInsAG. Until June 28, 2020, the opening of insolvency proceedings based on an application by a creditor is subject to the condition that the reason for the initiation of insolvency proceedings already existed on March 1, 2020. In concrete terms, this means that non-solvency or over-indebtedness must already have existed on March 1, 2020 for creditor insolvency applications filed between March 28, 2020 and June 28, 2020.

If the creditor is unable to substantiate, at the time of filing the insolvency petition, that the reason for insolvency already existed on 1 March 2020, he must expect the petition to be rejected as unfounded. It is therefore not advisable to make a hasty application, also in view of the fact that the regulation can be extended by decree to apply until 31 March 2021.

In any case, an application for insolvency regarding the assets of a debtor should be well-considered – in the worst case the creditor may be exposed to claims for damages if the application is unjustified.

Gesetz zur vorübergehenden Aussetzung der Insolvenzantragspflicht und zur Begrenzung der Organhaftung bei einer durch die COVID-19-Pandemie bedingten Insolvenz

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Elke Wurster



Maîtrise en droit international

Certified Compliance Officer (Univ.)