A Kraków-based wholesale distributor watched its receivables age past 90 days while supplier payment terms tightened to 30. Cash flow turned negative in the third quarter. The board knew insolvency was approaching – but had not yet crossed the legal threshold. That window, narrow as it was, proved decisive.

Polish restructuring law offers four preventive procedures that a company may use before formal insolvency is declared. Each procedure differs in court involvement, creditor consent thresholds, and the degree of management control the board retains. Choosing the wrong instrument – or waiting too long – forfeits the protection that only pre-insolvency tools can provide.

This case study traces how the Kraków distributor selected its procedure, what the process looked like in practice, and what transferable lessons apply to any Polish company facing financial distress. The four instruments examined are: the arrangement approval procedure, accelerated arrangement proceedings, arrangement proceedings, and remedial proceedings.

What was the background and why did the board act early?

The company operated a mid-size distribution network across Małopolska. Revenue was stable, but three large retail clients had entered their own financial difficulties, leaving unpaid invoices totalling over PLN 4m. The board consulted advisers within two weeks of identifying the shortfall – well before the 30-day filing deadline that insolvency law imposes once a company becomes unable to meet its obligations.

Acting early mattered for two reasons. First, preventive restructuring procedures are only available to a debtor that is threatened with insolvency, not yet formally insolvent. Second, board members who delay beyond that 30-day window face personal liability for the full amount of unsatisfied creditor claims – an irreversible consequence that no subsequent restructuring can undo. The board's prompt response kept both options open.

The National Court Register (KRS) records showed no enforcement proceedings against the company. The Polish Financial Supervision Authority (KNF) was not involved, as the business held no regulated licences. The District Court in Kraków – the competent court for restructuring filings in the region – was identified as the filing venue from the outset.

  • Receivables overdue by more than 90 days: PLN 4m
  • Supplier payment terms shortened to 30 days
  • No prior enforcement proceedings on KRS record
  • Board identified distress in Q3; filed within two weeks

We secured a restructuring plan approval for a wholesale client in Małopolska that avoided formal insolvency and preserved 47 jobs (autumn 2025). Early intervention was the single factor that made the outcome possible.

What are the four preventive restructuring types available in Poland?

Polish restructuring law – the Prawo restrukturyzacyjne (Restructuring Law, PrRest) – provides four distinct procedures. Each targets a different stage of financial difficulty and requires a different level of creditor and court involvement. Understanding the differences is the first strategic decision any distressed company must make.

The arrangement approval procedure (postępowanie o zatwierdzenie układu) is the lightest instrument. The debtor negotiates privately with creditors and collects votes on a restructuring plan without court supervision. Court involvement is limited to approving the agreed arrangement. This procedure suits companies where management already has creditor relationships and expects consent from creditors holding more than half the total debt by value.

The accelerated arrangement proceedings (przyspieszone postępowanie układowe) introduce a court-appointed supervisor but preserve board control over day-to-day operations. The procedure is available where disputed claims do not exceed 15 percent of total liabilities. A restructuring plan must be submitted to creditors within a short statutory window – typically concluded within two to three months.

The arrangement proceedings (postępowanie układowe) apply where disputed claims exceed that 15 percent threshold. Court supervision is heavier and the timeline longer – up to 12 months in practice. Management retains control, but major asset disposals require court or supervisor consent.

The remedial proceedings (postępowanie sanacyjne) are the most intensive instrument. A court-appointed administrator takes over management. The debtor gains access to tools unavailable in lighter procedures – including termination of unprofitable contracts and selective reduction of the workforce. Remedial proceedings resemble formal insolvency in their depth, but the company survives as a going concern if the plan succeeds. For a cross-border dimension, the interaction with foreign creditor claims is addressed in our analysis of cross-border insolvency involving Poland and Ukraine.

How did the strategy and process unfold in practice?

After mapping the four instruments against the company's creditor profile, the team selected accelerated arrangement proceedings. Disputed claims represented only 8 percent of total liabilities – well below the 15 percent threshold. The board retained full operational control, which was essential: the company needed to continue fulfilling supplier contracts during the procedure to preserve its trading relationships.

A court-appointed supervisor was nominated within 14 days of the filing. The supervisor reviewed the restructuring plan draft and confirmed it was financially viable. Creditor voting was organised within six weeks. Creditors holding more than two-thirds of the total debt by value approved the arrangement – the statutory majority required under PrRest. The District Court in Kraków confirmed the arrangement 21 days after the vote.

One complication arose mid-process: a secured creditor – a leasing company – initially withheld consent. The arrangement was restructured to give that creditor priority repayment over 18 months rather than the standard 36-month schedule offered to unsecured creditors. That adjustment secured the required majority without reopening the entire plan.

The total elapsed time from filing to court confirmation was 11 weeks. The company avoided formal insolvency, retained its workforce of 47 employees, and resumed normal trading terms with suppliers within 30 days of confirmation. Labour cost implications of the restructuring period – particularly for retained staff – were assessed using the framework in our note on minimum wage 2026 impact on employer costs in Poland.

For a comparable matter involving French creditors, see our separate case study on cross-border insolvency involving Poland and France.

What lessons transfer to other Polish companies facing distress?

The Kraków matter illustrates four transferable principles. First, the 30-day filing deadline under insolvency law is not a target – it is the outer boundary. Boards that treat it as a planning horizon lose access to preventive procedures entirely. Acting within two weeks of identifying distress preserved every available option in this case.

Second, instrument selection drives outcome. The arrangement approval procedure would have been faster but required private creditor negotiations the company could not complete in time. Remedial proceedings would have removed the board from management – an unnecessary step given the creditor profile. Matching the instrument to the specific debt structure is not a formality; it is the core of the strategy.

Third, personal liability under Polish corporate legislation creates a direct incentive for early action. Board members who delay beyond the statutory deadline face claims for the full value of unsatisfied obligations. That risk is irreversible once the deadline passes – no restructuring arrangement entered into afterwards eliminates it. White-collar defence considerations arise precisely at this junction, when a board's timing decisions come under scrutiny.

Fourth, secured creditors require bespoke treatment. A single secured creditor's dissent can block the required majority. Identifying that creditor early and modelling alternative repayment schedules – before the vote, not after – is the difference between a confirmed arrangement and a failed procedure.

  • Act before the 30-day insolvency filing deadline expires
  • Match the procedure to the disputed-claims percentage
  • Map secured creditors and model separate repayment terms early
  • Retain management control where the creditor profile allows it
  • Assess workforce costs for the restructuring period in advance

We advised a technology services company in the Mazowieckie region through accelerated arrangement proceedings, securing creditor approval within eight weeks and preserving the company's software development contracts (spring 2026).

Each company's financial position is specific. The gap between a preventive procedure and formal insolvency can close in weeks. Waiting forfeits the instruments that allow management to remain in control and the business to survive as a going concern.

To discuss how preventive restructuring procedures apply to your company's situation, contact info@kordeckipartners.com.

Frequently asked questions

Q: Can a company use the arrangement approval procedure if it has already missed payments to creditors?

A: Yes, provided the company has not yet crossed the legal threshold of formal insolvency. The arrangement approval procedure is available to a debtor that is threatened with insolvency – meaning it anticipates it will be unable to meet obligations, even if some payments have already been delayed. Once formal insolvency is established, preventive procedures are no longer available and the company must file for bankruptcy or standard insolvency proceedings within 30 days.

Q: How long does accelerated arrangement proceedings typically take, and what does it cost?

A: In straightforward cases, accelerated arrangement proceedings can be completed in eight to twelve weeks from filing to court confirmation. Costs include court filing fees (currently PLN 1,000 for the opening application), the supervisor's remuneration (set by the court based on the size of the debt mass), and legal advisory fees. The supervisor's fee in mid-size cases typically ranges between PLN 20,000 and PLN 80,000, depending on complexity.

Q: Does restructuring affect the personal liability of board members for company debts?

A: A common misconception is that opening any restructuring procedure automatically protects board members from personal liability. That is not correct. Personal liability under Polish corporate legislation arises when the board fails to file for insolvency within the statutory 30-day deadline. Opening a restructuring procedure before that deadline expires does suspend the obligation to file for insolvency – and therefore prevents liability from crystallising. However, if the deadline has already passed before the restructuring filing, the liability exposure remains and is not cured by the subsequent procedure.

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 white-collar defence. 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.