A Mazowieckie-region manufacturing company faced a hard deadline. Its core assets – production lines, contracts, and intellectual property – were generating value. The entity carrying them was not. With creditor pressure mounting and insolvency proceedings inevitable, the board had one question: could the business survive even if the legal shell did not?
A pre-pack sale (przygotowana likwidacja) under Polish restructuring and insolvency law allows a distressed company to sell its operating assets to a buyer identified before formal insolvency proceedings open. The court approves the sale terms at the point of opening the proceedings, transferring assets free of most encumbrances within days rather than months. The procedure is governed by the Prawo restrukturyzacyjne i upadłościowe (Restructuring and Insolvency Law), and the timeline from filing to asset transfer typically runs between four and twelve weeks.
This case study walks through the background, the strategic choices made, the procedural steps taken, and the lessons that apply to any distressed Polish company facing a similar situation. Each phase produced decisions that shaped the outcome – and each carries transferable value for boards, investors, and their advisers.
What was the background and why did pre-pack fit?
The company operated in the metal components sector. It employed around 80 people across two production sites in Mazowieckie. A combination of supply-chain disruption and a disputed long-term contract had eroded liquidity over 18 months. By the time the board sought advice, the company held outstanding trade payables exceeding PLN 4m and had missed two consecutive tax remittance deadlines – a pattern that triggers personal board liability under Polish corporate legislation.
Conventional insolvency liquidation was rejected early. A standard bankruptcy would have required a court-appointed trustee to sell assets piecemeal over 12 to 24 months. Customer contracts – the most valuable asset – contained change-of-control clauses. A prolonged process would have allowed counterparties to terminate. The business value existed only as a going concern.
Pre-pack offered a different path. The buyer – a domestic private equity vehicle with sector experience – was identified before any court filing. Price and terms were negotiated under a non-disclosure agreement. The National Court Register (KRS) records confirmed no competing security interests that would block a clean transfer. The board's restructuring advisers, working alongside our team, confirmed that the asset base was separable from the insolvent entity's liabilities.
- Outstanding secured debt: PLN 6.8m (one bank creditor)
- Trade creditors: approximately PLN 4m
- Employee claims: PLN 380,000 (wages and notice periods)
- Agreed pre-pack sale price: PLN 7.2m
The sale price exceeded the estimated liquidation value by roughly PLN 2.1m. That margin was the argument to the court – and to creditors.
How was the pre-pack application structured?
Polish insolvency law requires the pre-pack application to be filed simultaneously with, or immediately before, the insolvency petition. The application must include a valuation prepared by a court-approved expert, a draft sale agreement, and evidence that the proposed price represents at least the market value of the assets. Failure to meet any of these requirements causes the court to reject the pre-pack motion and proceed with standard liquidation – an irreversible consequence that forfeits the going-concern premium entirely.
We filed the insolvency petition and the pre-pack motion together at the District Court in Warsaw (Sąd Rejonowy dla m.st. Warszawy), which has jurisdiction over insolvency matters for companies registered in the capital region. The expert valuation had been commissioned six weeks earlier, under confidentiality. It valued the asset bundle at PLN 6.9m on a forced-sale basis and PLN 7.4m as a going concern – placing the agreed price squarely within the acceptable range.
The draft sale agreement was structured to transfer the production assets, customer contracts (with assignment consents already obtained from two key counterparties), and the registered trademarks. Employment contracts were excluded from the asset transfer but the buyer committed to re-hiring 68 of the 80 employees under new contracts within 14 days of completion. This structure avoided the automatic transfer of employment obligations that would have attached under a business transfer, while giving the buyer workforce continuity.
We also addressed board liability directly in the filing. The application documented that the board had filed within the statutory 30-day window from the date of established insolvency. That timing record protects directors from personal liability for the company's unsatisfied obligations – a point that mattered considerably to the two individual board members who were also shareholders.
What did the court process look like in practice?
The District Court in Warsaw listed the hearing for 21 days after filing. At the hearing, the judge examined the valuation, questioned the proposed trustee on creditor treatment, and reviewed the buyer's financial standing. No creditor objected at that stage – the secured bank had been briefed in advance and confirmed in writing that the sale price would cover its secured claim in full. That prior engagement with the Polish Financial Supervision Authority (KNF)-regulated lender proved decisive: courts are reluctant to approve pre-pack sales over the objection of a secured creditor holding a registered pledge (zastaw rejestrowy).
The court issued its ruling on the same day as the hearing. It declared insolvency, approved the pre-pack sale, and appointed a trustee with a mandate limited to executing the approved transaction. Asset transfer completed 11 days later. Total elapsed time from filing to completion: 32 days.
We secured the transfer of assets worth over PLN 7m for a manufacturing client in the Mazowieckie region (winter 2026). The speed preserved three key customer contracts that would have lapsed under a standard liquidation timeline.
One procedural complication arose. A minority creditor – holding a PLN 180,000 trade claim – filed an objection two days after the ruling, arguing the valuation methodology underweighted the intellectual property. The court dismissed the objection on the basis that the valuation had been prepared by a court-listed expert and that the objecting creditor had not submitted a competing valuation. The 14-day objection window closed without further challenge.
What lessons transfer to other distressed situations?
Pre-pack in Poland is not a shortcut. It is a precision instrument that rewards early preparation and punishes improvisation. The key lesson from this matter is timing: the buyer identification, valuation commission, and creditor pre-engagement must happen before the filing, not after. Every week of delay after insolvency becomes apparent increases the risk that a creditor files its own petition – removing the board's control over the process and triggering full liquidation.
Board liability is a parallel concern that cannot be deferred. Polish insolvency law sets a strict 30-day deadline for filing once the company meets the insolvency test. Missing that window exposes directors to personal liability for the full amount of unsatisfied obligations. In this matter, the board had documented the insolvency date internally and filed on day 28. That margin of two days was not accidental – it was the result of deliberate monitoring. For more on how board liability arises in tax contexts, see our analysis of board liability for tax arrears under Polish law.
Cross-border complexity adds another layer of risk. Where a distressed Polish company has assets or creditors in other EU member states, the pre-pack sale must account for the recognition of Polish insolvency proceedings abroad. Our earlier work on cross-border insolvency involving Poland and Lithuania illustrates how recognition gaps can freeze asset transfers at the border. In this case, the assets were entirely domestic, which simplified the analysis – but that is not always true for manufacturing companies with EU-registered equipment leases.
Tax exposure also requires attention before filing. A pre-pack sale may trigger VAT obligations on the transferred assets, depending on whether the transfer qualifies as a sale of an organised enterprise (zorganizowana część przedsiębiorstwa). If it does, the transfer may fall outside the scope of VAT. If it does not, VAT at 23% applies to each asset class separately. The distinction turns on factual analysis of what is being transferred and whether it forms a functionally independent unit. Boards facing this question should review our guide on KAS tax audits and how to prepare, since a pre-pack that triggers a tax liability can erode the going-concern premium that justified the procedure in the first place.
The checklist below distils the preparation steps that made this matter succeed.
- Identify and sign a buyer under NDA at least six weeks before filing
- Commission a court-approved expert valuation in parallel with negotiations
- Obtain assignment consents from key contract counterparties before filing
- Brief the secured creditor and obtain written confirmation of support
- Document the insolvency date and file within the 30-day statutory window
A second matter from our practice reinforces the cost of delay. We advised a technology services company in Silesia (spring 2025) where the board waited 11 weeks after the insolvency threshold was crossed before engaging restructuring counsel. By that point, a major supplier had already filed a separate insolvency petition. The pre-pack option was foreclosed. The company entered standard bankruptcy, and the going-concern value – estimated at PLN 3.5m above liquidation value – was lost entirely. Personal liability proceedings against two directors followed.
Frequently asked questions
Q: How long does a pre-pack sale typically take in Poland from initial filing to asset transfer?
A: The timeline depends on court workload and the completeness of the filing, but well-prepared matters in Warsaw typically complete within 30 to 45 days from filing. The court hearing is usually listed within 14 to 21 days. Asset transfer follows the ruling within days once the trustee is appointed. Poorly prepared filings – missing valuations or incomplete draft agreements – can extend the process by weeks and risk rejection of the pre-pack motion.
Q: Does a pre-pack sale eliminate all liabilities attached to the transferred assets?
A: Not automatically. The court approval transfers assets free of most pre-insolvency claims, but certain obligations – including some tax liabilities and employment claims where employees are transferred as part of the business – may follow the assets depending on how the transaction is structured. The distinction between an asset sale and a business transfer is factually intensive. Mischaracterising the transaction can expose the buyer to successor liability, which is a common misconception that advisers must address before the filing is made.
Q: Can a foreign investor act as the buyer in a Polish pre-pack sale?
A: Yes. Polish insolvency law does not restrict the buyer's nationality or domicile. However, a foreign buyer must have a Polish tax identification number (NIP) or be prepared to obtain one before completion, since the asset transfer triggers registration obligations. Where the buyer is acquiring assets that include real property, additional formalities under the ustawa o nabywaniu nieruchomości przez cudzoziemców (Law on Acquisition of Real Property by Foreigners) may apply, depending on the buyer's jurisdiction of incorporation and the nature of the land.
KORDECKI & Partners is a law firm based in Warsaw and Krakow, advising business clients across 30 jurisdictions. Our team combines expertise in Polish and international law with a practical approach to restructuring, insolvency, and distressed asset transactions. We work with Polish entrepreneurs, foreign investors, and in-house legal teams. To discuss your situation, contact info@kordeckipartners.com.
To receive an expert assessment of your restructuring options or pre-pack readiness, contact info@kordeckipartners.com.
Disclaimer: This publication is provided for informational purposes only and does not constitute legal advice. The information herein should not be relied upon as a substitute for professional legal counsel tailored to your specific circumstances. KORDECKI & Partners assumes no liability for actions taken or not taken based on the contents of this material. For advice regarding your particular situation, please contact info@kordeckipartners.com.