A Mazowieckie-based technology company receives a winding-up petition on a Tuesday morning. By Friday, its largest competitor has already approached the insolvency court with a prepared acquisition offer. That scenario – once unthinkable under Polish law – is now the everyday reality of the pre-pack mechanism. Understanding how it works, and how fast it moves, is no longer optional for boards, lenders, and investors operating in Poland.
A pre-pack sale (formally: przygotowana likwidacja, or prepared liquidation) allows a court to approve the sale of an insolvent company's enterprise – or a key asset – to a pre-identified buyer before the insolvency proceedings formally open. Polish insolvency law sets a default court decision deadline of 30 days from the filing of the motion. The sale price must not fall below the value established in an independent expert valuation commissioned by the applicant.
This alert explains what the procedure involves, who is affected by its thresholds, and what boards and investors must do immediately once insolvency becomes foreseeable. Three action items follow each section. Read them in order.
What does the pre-pack procedure involve in Poland?
The pre-pack mechanism sits inside Polish restructuring and insolvency law, specifically within the framework governing bankruptcy proceedings (postępowanie upadłościowe). It is not a standalone procedure. The motion for a pre-pack sale is filed together with – or immediately before – the bankruptcy petition itself. The National Court Register (KRS) records the transaction once the court approves the sale order.
The applicant – typically the debtor, a creditor, or a prospective buyer – must attach an independent valuation of the enterprise or asset. That valuation sets the floor price. The court appoints a temporary supervisor (tymczasowy nadzorca sądowy) to verify the valuation and assess whether the proposed sale price reflects fair market value. The supervisor's report reaches the court within 30 days. If the court is satisfied, it issues the sale approval simultaneously with the bankruptcy declaration.
Three elements distinguish a successful pre-pack from a failed one:
- A buyer identified and financially capable before the motion is filed
- An independent valuation that withstands judicial scrutiny
- A sale price at or above the valuation floor – courts have rejected motions where the gap exceeded 15% without a documented commercial rationale
We secured approval of a pre-pack sale of a manufacturing enterprise valued at over PLN 8m for a client in the Mazowieckie region (autumn 2025). The key was submitting the buyer's financing confirmation alongside the valuation on day one of the filing.
Who is affected – and what are the thresholds?
The pre-pack mechanism applies to any debtor who meets the insolvency threshold under Polish insolvency law: payment obligations overdue by more than 30 days and liabilities exceeding assets (the balance-sheet test). Both conditions need not be met simultaneously – either triggers eligibility. For commercial companies, board members carry personal liability if the bankruptcy petition is not filed within 30 days of insolvency arising.
Foreign investors and cross-border groups face an additional layer of complexity. Where the debtor's centre of main interests (COMI) is in Poland, the pre-pack sale binds creditors across the European Union under the EU Insolvency Regulation. This matters for German or Dutch parent companies whose Polish subsidiary holds the group's core operational assets. For a deeper look at cross-border mechanics, see our analysis of cross-border insolvency involving Poland and Sweden.
Two groups face the sharpest exposure:
- Board members of Polish limited liability companies (spółka z ograniczoną odpowiedzialnością, sp. z o.o.) who delay filing beyond the 30-day window – personal liability for the full amount of unsatisfied creditor claims follows automatically
- Secured creditors holding pledges over enterprise assets – a pre-pack sale extinguishes most encumbrances, so a creditor who does not engage early forfeits priority recovery
The Polish Financial Supervision Authority (KNF) monitors pre-pack transactions involving regulated entities. Any sale of a licensed business – a payment institution, for instance – requires KNF consent before the court can issue the approval order. That consent process adds up to 60 days to the timeline. Plan accordingly.
Directors facing potential white-collar defence exposure should also note that a deliberately delayed insolvency filing, combined with a pre-arranged asset sale to a related party, can attract criminal liability under Polish criminal law. The line between legitimate pre-pack planning and fraudulent preference is thin. Take advice before structuring the transaction.
What must boards and investors do immediately?
Speed is not merely advantageous – it is structurally required. Once insolvency arises, the 30-day filing clock starts. Missing it does not just expose the board to personal liability; it also narrows the pool of viable buyers, because sophisticated acquirers avoid targets where the board has already breached its filing duty. The pre-pack mechanism rewards preparation, not reaction.
Costs matter too. Pre-pack proceedings generate court fees, supervisor fees, and valuation costs. Court fees for bankruptcy petitions in Poland currently stand at PLN 1,000 for the petition itself, but the supervisor's remuneration – set by the court – typically ranges from PLN 15,000 to PLN 80,000 depending on asset complexity. Budget for this before filing. For context on how Polish courts allocate procedural costs more broadly, our note on cost recovery rules in Polish civil proceedings provides useful background.
What to prepare before filing a pre-pack motion:
- Board resolution acknowledging insolvency and authorising the filing
- Independent asset valuation from a court-registered expert (biegły sądowy)
- Signed letter of intent or conditional sale agreement with the identified buyer
- Buyer's proof of financing (bank confirmation or equity commitment letter)
- Updated creditor list with amounts and security interests
Directors should also review their D&O insurance coverage before the motion is filed. A pre-pack transaction is a high-scrutiny event; creditors who feel underserved by the sale price will look for grounds to challenge the board's conduct. Our overview of D&O insurance coverage for Polish directors sets out what policies typically cover – and what they do not.
We assisted a foreign investor in Lower Silesia in acquiring a distressed logistics enterprise through a pre-pack sale, with assets exceeding EUR 3m, within 28 days of the initial filing (winter 2025). The transaction closed without creditor challenge because the valuation was unimpeachable and the buyer's financing was unconditional on day one.
Specific situation of your company requires immediate assessment – delay beyond the 30-day insolvency window precludes the pre-pack option entirely and triggers personal board liability that cannot be reversed.
If your company is approaching insolvency thresholds or you are evaluating a distressed acquisition in Poland, contact us now. We will assess the pre-pack eligibility, coordinate the valuation, and file the motion within the statutory window: info@kordeckipartners.com.
Frequently asked questions
Q: Can a pre-pack sale be challenged by unsecured creditors after the court approves it?
A: Yes, but the grounds are narrow. Creditors may challenge the sale if the price fell below the court-approved valuation or if the buyer was a related party and the transaction lacked independent scrutiny. A well-documented valuation and an arm's-length buyer structure significantly reduce challenge risk. Courts have generally upheld pre-pack approvals where the supervisor's report was thorough.
Q: How long does a pre-pack sale actually take from filing to completion?
A: The statutory target is 30 days for the court decision. In practice, straightforward cases in Warsaw district courts have closed in 25 to 40 days. Regulated-sector transactions requiring KNF consent take 60 to 90 days from filing. Asset transfers to the buyer typically complete within 7 days of the court order becoming final.
Q: Does the pre-pack mechanism protect the buyer from the debtor's pre-sale liabilities?
A: This is a common misconception. The buyer acquires the enterprise free of most encumbrances, but employment law obligations – specifically, the automatic transfer of employment contracts under Polish labour law – follow the enterprise. Buyers must account for inherited workforce costs. Tax liabilities of the debtor do not transfer to the buyer under the pre-pack structure, which is one of the mechanism's principal commercial advantages.
About KORDECKI & Partners
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 pre-pack transactions. We work with Polish entrepreneurs, foreign investors, and in-house legal teams. To discuss your situation, 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.