An administration order provides the necessary solutions for companies in over a third of cases, for all sizes, and for half of cases concerning companies with a turnover of more than 5 million euro. (Source: Altares-Deloitte, applied over 10 years from 1997 to 2006).
As with the safeguard procedure, an administration order requires that all previously existing debts are frozen.
The observation period lasts for 6 months and is renewable once (and exceptionally for a further period on the request of the Prosecutor's office). It represents a breathing space for the company to restructure and re-establish a situation of profitability.
The procedure leads to either the implementation of an administration plan; where profitability and/or the renegotiation of debts means that they will be discharged within a maximum period of 10 years, or to a decision to sell all or part of the company's business in order to ensure its survival and protect jobs together with the discharge of existing debts.
The administrator's job is to help the company with its management and the development of its plan.