Request for discharge of residual debts after closure of bankruptcy of a natural person (sole proprietorship): failure to respect the three-month period no longer results in irrevocable loss of the right to discharge.

Lieselot SeghersAdverit Antwerp, Belgium

After the closure of a bankruptcy of a natural person (sole proprietorship), that person must in principle still answer with his entire estate for the debts that were not settled through the liquidation of the bankruptcy estate (the so-called “residual debts”).

To avoid this, the bankrupt person may file a request for discharge of these “residual debts”. Art. XX.173, §2 of the Code of Economic Law stipulates that this request must be filed no later than three months after the publication of the bankruptcy judgment.

This meant that the right to discharge of residual debts was irrevocably lost if the request for discharge had not been filed within this period.

The Constitutional Court annulled that condition by judgment of 21 October 2021 (judgment no. 151/2021), among other things in order to promote “second-chance entrepreneurship”.

Filing the petition at a later point in time is therefore now permitted. However, the court must still be able to rule on it ‘at the latest in the judgment closing the bankruptcy’.

Are you considering filing for bankruptcy? Do not hesitate to contact us for advice and assistance at contact@alisadvocaten.be.

Lieselot SEGHERS

Related practice areas

Insolvency law

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