We are pleased to announce that our team successfully represented a prominent financial institution in obtaining a liquidation order against its debtor, involving a debt exceeding EUR 2 billion. This order, one of the highest value cases ever presented before the Cypriot Courts, marks a significant achievement in the realm of insolvency law and reinforces our firm's expertise in handling complex financial disputes.

Understanding the Liquidation Process in Cyprus

Liquidation, or "winding up" by the court, is a legal procedure undertaken to bring a company's existence to an end. This process is generally initiated when a company is unable to meet its financial obligations. In Cyprus, the Companies Law, Cap. 113 provides the statutory framework governing the liquidation process, which can be either voluntary or compulsory.

A compulsory liquidation is initiated by the court following a petition, usually filed by a creditor. The most common ground for a creditor to seek liquidation is the company's inability to pay its debts as they fall due. Under Cypriot law, a company is presumed to be unable to pay its debts if a creditor, to whom the company owes more than EUR 5,000, has served a demand for payment, and the company has failed to comply within 21 days.

Click here for our guide Liquidation & Insolvency in Cyprus to learn more.

The Role of the Cypriot Court in Liquidation Proceedings

For a successful liquidation petition, the Court must be satisfied that the debt in question is not bona fide disputed - meaning the debtor does not have a genuine or substantial argument against the validity of the debt. The Court carefully examines the financial situation of the debtor company, including its assets, liabilities, and overall solvency.

In this landmark case, Eleftherios Economou, a senior partner at Economou & Co LLC, led the proceedings. His strategic approach and in-depth understanding of insolvency laws were pivotal in persuading the Court to issue a liquidation order.

Implications of the Liquidation Order

The successful liquidation order obtained by our firm not only allows our client to recover the outstanding debt but also sends a clear message to the market about the robustness of legal recourse available in Cyprus for financial institutions dealing with insolvent debtors. It highlights the strength of our legal team in addressing complex insolvency cases and reinforces our commitment to delivering outstanding results for our clients.

Why Choose Economou & Co LLC?

At Economou & Co LLC, we pride ourselves on our deep expertise in insolvency and restructuring law, supported by a team of highly skilled litigators. Our firm is dedicated to providing strategic, client-focused solutions that address the unique challenges of each case. Whether dealing with high-value debt recovery or addressing the complexities of corporate insolvency, we are here to provide the legal guidance you need.