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I am curious about the eligibility and procedure for applying for corporate rehabilitation.

Is there a separate eligibility to apply for corporate rehabilitation? I am also curious about the procedure. My company is struggling, so I have recently been looking into a rehabilitation application, but many things are so complicated.. I am worried because I hear that applying for corporate rehabilitation is more demanding than individual rehabilitation. It would be best to get help from a specialized attorney, right? I would be grateful if you could tell me the cost and procedure for applying for corporate rehabilitation.

Corporate rehabilitation

Application for corporate rehabilitation

Answer

Published: 2023-03-23

Author : ChanWoo JEONG

Corporate rehabilitation is a legal procedure that helps a company experiencing financial difficulty to have its debts adjusted and to normalize its management.

A company with a possibility of rehabilitation can apply for rehabilitation. Under the Debtor Rehabilitation and Bankruptcy Act, not only companies under the Commercial Act but also sole proprietors can use the corporate rehabilitation application system.

The rehabilitation procedure proceeds in the following order: an application to commence rehabilitation proceedings, a preservative measure and a stay order, a decision to commence rehabilitation proceedings, the filing and examination of rehabilitation claims, and the submission and approval of the rehabilitation plan.
It is true that corporate rehabilitation has much more demanding procedures and requirements than individual rehabilitation.

Because there are many complex legal and practical tasks, such as drafting the rehabilitation plan, consulting with creditors, and responding to the court, the assistance of a specialized attorney is essential.

A specialized attorney diagnoses the company's situation and conducts a legal assessment accordingly.

Thereafter, they carry out corporate rehabilitation application review items, such as the evaluation of corporate value and liquidation value, as well as an evaluation of the company's management.

The cost of corporate rehabilitation varies greatly depending on the size of the company and the complexity of the case. Usually, the attorney's fee ranges from several million won to several tens of millions of won, and the stamp fee and service fee paid to the court can also separately amount to several hundred thousand won or more.

Rehabilitation is not simply a procedure for reducing debt but a significant reconstruction process that determines the company's future, so we recommend proceeding with the corporate rehabilitation application procedure with the help of a specialized attorney.