An insolvency proceeding is the last resort for over-indebted individuals and families. It has effects on the debtor's assets, as the court orders the sale of the debtor's assets to pay the debts.

In this sense, the Parliament and the European Commission felt the need to create laws in this matter, aiming to save some companies and individuals in over indebtedness situations. “Among the measures, the one that has the most impact is the reduction of the insolvency period from five to three years”, DECO explained.

With the reduction of the term of the insolvency period for three years, it is supposed to guarantee the possibility of a second chance after these three years if the company or the individual have met all requirements. Also, these new rules apply not only to new insolvency proceedings, but also to those already in progress.

However, from DECO’s point of view, there is still a lack of reinforcement of financial information to educate the insolvent. “The Parliament did not take advantages of the opportunity to create new mechanisms that would allow access to financial mechanisms to allow their financial re-education”.

In addition, DECO can support you in cases of over-indebtedness. For further information, please see: www.gasdeco.net/literacia-financeira.


Email: deco.algarve@deco.pt
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Author

Paula Martins is a fully qualified journalist, who finds writing a means of self-expression. She studied Journalism and Communication at University of Coimbra and recently Law in the Algarve. Press card: 8252

Paula Martins