Declaration of insolvency (insolvenserklæring)
Also known as insolvency declaration, declared insolvent, insolvenserklæring, insolvent, erklæret insolvent
A declaration of insolvency is the debtor's statement in the bailiff's court that he is unable to pay — given under penalty of law.
In practice
Where the bailiff’s court can find no assets, the debtor makes a declaration of insolvency: a statement that he owns nothing of value. It is given under penalty of law — if he lies, he commits a criminal offence.
The declaration triggers a bar period of six months, during which fresh enforcement cases against the same debtor may be refused.
Where it commonly goes wrong
- It is read as a final no. It is a description of a moment. In a year’s time the picture may be an entirely different one.