Can concordatum be a solution for the financial relationship between firms and banks?

Abstract

Introduction Although the operational periods of the enterprises are unlimited in terms of institutional sense, it is seen that they have failed in economic life and/or have ceased their operations due to many reasons. Companies may undergo financial difficulty or failure due to various reasons such as economic and social changes in the national and international environment in which they operate, and the increasingly destructive conditions of competition. Financial difficulty arises from the inadequacy of liquid assets to meet the current liabilities of the companies or the inability of the assets to meet debts of the companies in the long term. This situation affects creditors, shareholders and other related parties to the company. The causes of financial difficulty or failure of the companies may be due to internal reasons such as mis-management or external (systemic) reasons beyond their control. Regardless of the source of financial distress/failure of companies, the current situation of the companies should be determined quickly before they go bankrupt. If necessary, urgent measures should be taken to improve the financial situation of the company. That is why, the concordatum, which is an important bankruptcy institution established for this purpose, should be employed in accordance with its real purposes. Otherwise, the concordatum will disrupt both the institution itself and the economic structure. Therefore, it is necessary to ensure that the restructuring programs, which are decided by the concordatum institution, are appropriate for their purpose. This requires immediate transfer of applications…. © Peter Lang GmbH Internationaler Verlag der Wissenschaften Berlin 2019.