Latvia

Abstract

According to the paragraph 62 part 3 of Latvian Insolvency Law the debtor (legal person) is obliged to file for insolvency proceedings (liquidation) if the debtor is not able to service its debts and it is not possible to file for legal protection procedure (court approved reorganisation) or to reach out of court settlement with creditors. According to Latvian legislation the management of the debtor is criminally liable for hesitation to file insolvency petition and according to the mentioned provisions of Insolvency Law management of a debtor may avoid criminal liability if they try to reach out of court restructuring.