Criminal defense for Delayed Insolvency Filing in Bonn

Legal Basis

§ 15a InsO

Sentencing Range

Imprisonment of up to three years or a fine

Summary

Failure to file for insolvency proceedings despite being obligated to do so as a company officer

An accusation of delaying an insolvency filing under Section 15a of the Insolvency Code threatens managing directors personally as soon as a company becomes insolvent or over-indebted. The decisive questions are the exact moment of insolvency and the three-week filing period. Attorney Philip Bafteh defends directors and entrepreneurs in Bonn, Cologne and nationwide – after full access to the case file.

Delayed Filing for Insolvency (Section 15a InsO)

Delayed filing for insolvency is one of the most common economic crimes in Germany. Managing directors and board members of corporations are obligated to file for insolvency proceedings without culpable delay — within three weeks of inability to pay or six weeks of overindebtedness at the latest. Late or omitted filing can result not only in criminal consequences but also in personal liability claims. This is a particularly important area for expats serving as directors of German companies.

Legal Basis

Section 15a(4) of the German Insolvency Code (InsO) provides:

“Anyone who, contrary to subsection (1) sentences 1 and 2, also in conjunction with sentence 3 or subsection (2) or (3), fails to file an opening petition, or files it incorrectly or not in a timely manner, shall be punished with imprisonment of up to three years or a fine.”

Section 15a(5) InsO also criminalises negligent commission (imprisonment up to one year or a fine).

Elements of the Offence

Persons obligated to file: The filing obligation applies to members of the representative body and liquidators of a legal entity (managing directors of a GmbH, board members of an AG, board members of an association, personally liable partners in a GmbH & Co. KG). De facto managing directors may also be subject to the filing obligation and thus qualify as perpetrators.

Ground for insolvency: There must be inability to pay (Section 17 InsO) or overindebtedness (Section 19 InsO). Inability to pay exists when the debtor is unable to meet due payment obligations. Overindebtedness exists when assets no longer cover liabilities, unless continuation of the business is predominantly probable.

Missed deadline: The insolvency petition must be filed without culpable delay. The maximum deadline is three weeks from the onset of inability to pay or six weeks from the onset of overindebtedness. These deadlines serve exclusively for restructuring purposes — if no restructuring is being pursued, the petition must be filed immediately.

Intent or negligence: Intentional commission is punished with up to three years’ imprisonment; negligent commission with up to one year.

Typical Methods of Commission

Classic cases include deliberately delaying the insolvency petition in the hope of economic improvement, incorrect assessment of the economic situation by the managing director, continuing business operations despite recognisable inability to pay while taking on new obligations, concealing inability to pay through deferral agreements or non-filing of annual accounts, and resorting to business splitting or shell company arrangements.

Sentencing Range

Intentional delayed filing for insolvency carries a penalty of up to three years’ imprisonment or a fine. Negligent commission carries up to one year’s imprisonment or a fine. In addition, substantial civil liability risks arise: the managing director is personally liable for all payments made after the onset of material insolvency (Section 15b InsO) and for the so-called quota damage suffered by creditors.

Typical Defense Strategies

The defense frequently focuses on demonstrating that no ground for insolvency existed at the relevant time. The distinction between a temporary payment bottleneck (not criminal) and inability to pay (criminal) requires a precise business analysis. The overindebtedness assessment is also complex, as it requires a going-concern prognosis. Furthermore, it can be argued that the filing deadline had not yet expired because serious restructuring efforts were underway. In cases of negligent commission, it must be examined whether the managing director could and should have recognised the crisis — lack of commercial expertise may be exculpatory but may give rise to an organisational fault argument.

Frequently asked questions

What is delayed insolvency filing? The criminal offence of failing to file for insolvency in time: managing directors of a GmbH or board members of an AG must file without undue delay – at the latest within three weeks of illiquidity (six weeks for over-indebtedness) under Section 15a of the German Insolvency Code (InsO).

Which deadline applies? Filing must happen without culpable delay; the three-week (illiquidity) and six-week (over-indebtedness) periods are maximum limits, not grace periods.

What penalty do I face? Intentional violations carry a fine or imprisonment of up to three years; negligent violations up to one year. Disqualification from serving as managing director may follow a conviction.

Do I have to attend a police summons? As a suspect you are generally not obliged to attend police questioning – and you should not comment on liquidity or balance-sheet questions before the case file and the figures have been reviewed.

Summons or accusation of Delayed Insolvency Filing? What matters now

Make no statement to the police at first

As an accused person you are never obliged to comment on the allegation. Anything said to the police can be used against you. Provide statements only through your defense attorney and only after reviewing the case file.

File inspection comes first

A sound defense against the allegation of Delayed Insolvency Filing requires knowledge of the investigation file. Only once the available evidence is clear can we decide whether a statement is advisable or whether remaining silent is the better strategy.

Possible discontinuation of proceedings

Not every case ends in a trial. Depending on the evidence and any prior record, the proceedings may be discontinued for lack of sufficient suspicion (§ 170 II StPO), for triviality (§ 153 StPO) or subject to conditions (§ 153a StPO). Often a penalty order without a public trial can be achieved.

Victim-offender mediation and restitution

In many cases, victim-offender mediation or making good the damage (§ 46a StGB) can significantly reduce the sentence or enable a discontinuation. Whether this is advisable in your case is something we assess based on the file.

What we do after reviewing the file

We examine the evidence for reliability and admissibility, look for procedural errors, develop the defense strategy, seek a dismissal of the proceedings through discussions with the public prosecutor’s office and represent you, if necessary, at trial before the Bonn Local Court or Bonn Regional Court.

Available 24/7: +49 228 504 463 36

This information does not replace a review of the individual case. In criminal proceedings, the defense strategy depends substantially on the case file, the specific allegation and the evidence.