A Mazowieckie-based distribution company is three months behind on supplier invoices. The management board has just received the first enforcement notice. The company still generates revenue – but the debt structure has become unmanageable. What happens next determines whether the business survives or closes permanently.

Simplified arrangement proceedings (postępowanie o zatwierdzenie układu, PZU) give an insolvent or threatened-insolvent Polish company the fastest statutory path to binding creditor arrangements. The debtor appoints a licensed restructuring advisor, gains an automatic four-month protection window against enforcement, and proposes a restructuring plan to creditors – all without an opening court hearing. Creditor voting closes within four months of the supervisor's appointment, and court approval follows shortly after.

This guide walks through the PZU procedure step by step: who qualifies, how the timeline runs, what the proceedings cost, where companies make avoidable mistakes, and how three different business profiles – a manufacturer, a technology company, and a foreign-owned subsidiary – should approach the process. The FAQ block at the end addresses the questions management boards ask most often.

Who qualifies for simplified arrangement proceedings in Poland?

PZU is available to any debtor whose disputed claims do not exceed fifteen percent of total liabilities. That threshold is the key eligibility filter. Below it, the debtor may open PZU independently – without a court application. Above it, the company must use one of the court-supervised restructuring procedures instead.

Polish restructuring law distinguishes between a debtor who is already insolvent and one who is merely threatened with insolvency. Both qualify for PZU. The National Court Register (Krajowy Rejestr Sądowy, KRS) does not need to record the opening of proceedings – the debtor publishes a notice in the Court and Commercial Gazette (Monitor Sądowy i Gospodarczy), and the four-month protection window begins from that date.

Eligibility conditions worth checking before the first step:

  • Disputed creditor claims do not exceed 15% of total liabilities
  • The company has at least two creditors whose claims will be covered by the arrangement
  • A licensed restructuring advisor (licensed by the Ministry of Justice) is willing to act as arrangement supervisor
  • No prior PZU was terminated within the last ten years on grounds of debtor misconduct

One common misconception is that PZU requires the debtor to be already insolvent. It does not. A company that foresees insolvency within the next twelve months may open PZU proactively – and doing so before insolvency materialises significantly improves the board's position under personal liability rules. The Polish Financial Supervision Authority (Komisja Nadzoru Finansowego, KNF) monitors regulated entities separately, but for most commercial companies the KRS publication is the only formal trigger.

We secured a restructuring plan approval for a manufacturing client in the Mazowieckie region (autumn 2025), where the debtor had opened PZU two months before formally meeting the insolvency test. Early entry gave the board a clean liability record and the creditors a higher recovery rate than liquidation would have produced.

How does the PZU timeline run from day one to court approval?

The statutory maximum for PZU is four months from the date of the arrangement supervisor's appointment. That is the hard outer limit. In practice, well-prepared cases reach creditor voting in ten to twelve weeks. The court approval hearing typically follows within four to six weeks of a successful vote.

The timeline unfolds in five distinct phases. Understanding each phase prevents the delays that derail most cases.

Phase 1 – Supervisor appointment and notice publication (days 1–14). The debtor selects a licensed restructuring advisor, signs an engagement agreement, and publishes the opening notice in the Court and Commercial Gazette. From publication, enforcement against assets covered by the arrangement is suspended. Tax authorities at the Head Office of the National Revenue Administration (Krajowa Administracja Skarbowa, KAS) are bound by the same suspension – a point many debtors overlook.

Phase 2 – Creditor list and arrangement proposal (weeks 2–6). The supervisor prepares the creditor list and the restructuring plan. The plan must include a realistic cash-flow forecast, a description of restructuring measures (debt haircut, maturity extension, or conversion to equity), and a comparison with the liquidation alternative. Creditors who receive a higher recovery under the plan than under liquidation have a strong incentive to vote in favour.

Phase 3 – Creditor voting (weeks 6–14). Voting runs in writing or electronically. A plan is approved when creditors holding more than half the total claims vote in favour. That majority requirement applies across all creditor groups unless the plan creates separate groups – in which case each group votes separately.

Phase 4 – Court approval (weeks 14–20). The supervisor submits the voting outcome to the district court. The court reviews legality, not commercial merit. Approval is typically granted within four to six weeks. From the approval date, the arrangement binds all creditors listed – including those who voted against it.

Phase 5 – Arrangement execution. The debtor implements payment schedules under court supervision. Failure to meet the first instalment on time is the single most common cause of arrangement termination.

What does a PZU proceeding cost?

Cost is the factor that most often surprises management boards. PZU has three distinct cost components: the supervisor's fee, court fees, and internal preparation costs. Together they typically range from PLN 30,000 to PLN 150,000 for a mid-market company – far below the cost of bankruptcy proceedings or prolonged enforcement.

The arrangement supervisor's fee is negotiated directly with the debtor. Market rates for a mid-market case run from PLN 20,000 to PLN 80,000, depending on the complexity of the creditor structure and whether the supervisor also assists with creditor negotiations. The fee is paid from the debtor's current assets and is treated as a cost of the proceedings – it ranks ahead of most creditor claims.

Court fees for the approval application are fixed by statute at PLN 1,000. That figure is one of the most misunderstood aspects of PZU: the court fee is minimal precisely because the procedure is designed to keep the judiciary's role limited to a legality check.

Internal costs – management time, financial modelling, legal advice on the arrangement proposal – vary widely. A company with organised financial records and a cooperative CFO can complete Phase 2 in two weeks. A company with fragmented accounting may need six weeks and additional professional support.

Three business scenarios illustrate the cost range:

  • Manufacturing company (Silesia): 120 creditors, PLN 8m in total liabilities, supervisor fee PLN 55,000, total proceedings cost approximately PLN 80,000.
  • IT services company (Małopolska): 18 creditors, PLN 2m in total liabilities, supervisor fee PLN 22,000, total proceedings cost approximately PLN 35,000.
  • Foreign-owned subsidiary (Lower Silesia): 60 creditors across three jurisdictions, supervisor fee PLN 70,000, additional cross-border coordination costs, total approximately PLN 130,000.

For the foreign-owned subsidiary scenario, cross-border dimensions add material cost. The parent company's insolvency proceedings in another jurisdiction may affect which assets are available for the Polish arrangement. Our guide on cross-border insolvency involving Poland and Sweden explains how parallel proceedings interact under EU Insolvency Regulation rules.

What mistakes cause PZU proceedings to fail?

Most PZU failures are avoidable. They trace back to four recurring errors – each of which forfeits the protection that PZU was designed to provide and, in the worst cases, exposes board members to personal liability for the full value of unsatisfied creditor claims.

Error 1 – Starting too late. Boards that wait until enforcement notices arrive have already lost negotiating leverage. Creditors who have initiated enforcement are entitled to proceed against assets not covered by the arrangement. Opening PZU before the first enforcement action preserves the full suspension benefit. Polish insolvency law sets a 30-day window for filing after the insolvency test is met – boards that miss that window face personal liability risk that PZU alone cannot cure.

Error 2 – Underestimating the creditor list. Omitting a creditor from the arrangement list does not make that creditor disappear. It creates a creditor who is not bound by the approved arrangement and retains full enforcement rights. A single omitted trade creditor holding PLN 500,000 can block asset sales needed to fund the arrangement.

Error 3 – Unrealistic cash-flow forecasts. Courts do not review commercial merit, but creditors do. A plan that promises full repayment within 24 months when the company's free cash flow supports only 48 months will fail the creditor vote. The restructuring advisor's credibility depends on conservative, defensible projections.

Error 4 – Missing the four-month deadline. If the debtor fails to submit the creditor vote to the court within four months of the supervisor's appointment, the proceedings lapse automatically. The automatic enforcement suspension ends. Creditors resume collection without restriction. There is no extension mechanism under current law – this consequence is irreversible.

We obtained interim asset protection measures for a technology client in Wielkopolska (winter 2026) where the original PZU had lapsed due to a missed deadline. Reopening required a full court-supervised arrangement procedure – at three times the original cost and with a narrower creditor majority.

Directors concerned about personal exposure during restructuring should review our analysis of D&O insurance coverage for Polish directors, which addresses how coverage interacts with restructuring proceedings.

How does PZU compare with other restructuring instruments?

PZU sits at one end of a spectrum of four statutory restructuring procedures. Choosing the right instrument depends on three variables: the disputed-claims threshold, the degree of court supervision the debtor can tolerate, and the time available before creditors escalate enforcement.

The four procedures in ascending order of court involvement are: PZU (no opening court hearing), accelerated arrangement proceedings (przyspieszone postępowanie układowe), standard arrangement proceedings (postępowanie układowe), and remedial proceedings (postępowanie sanacyjne). Remedial proceedings allow the debtor to void certain pre-insolvency transactions – a power PZU does not provide.

A decision matrix by situation:

  • Disputed claims below 15%, enforcement not yet started: PZU – fastest, lowest cost, no court opening required.
  • Disputed claims above 15%, creditor cooperation likely: Accelerated arrangement – court opens within two weeks, similar timeline to PZU thereafter.
  • Complex creditor structure, voidable transactions present: Remedial proceedings – broader powers, but proceedings last 12–18 months.
  • Insolvency already declared or imminent: Assess pre-pack (pre-packaged bankruptcy) as an alternative – see our note on pre-pack structures below.

Pre-pack (przygotowana likwidacja) is not a restructuring procedure – it is a controlled asset sale within bankruptcy. It suits cases where the business is viable but the legal entity is not. The buyer acquires the business free of liabilities. The creditors receive sale proceeds. Management boards sometimes prefer pre-pack over PZU when the debt burden is so severe that even a 70% haircut leaves the company cash-flow negative.

For companies with significant digital compliance obligations – including VAT reporting under the National e-Invoicing System – restructuring timelines must account for ongoing KSeF obligations. Our article on what KSeF means for your business in Poland explains how invoicing obligations continue through restructuring proceedings.

For a tailored strategy on selecting the right restructuring instrument for your company, reach out to info@kordeckipartners.com.

Frequently asked questions

Q: Can a company continue trading normally during PZU proceedings?

A: Yes. The debtor retains full management control during PZU. The arrangement supervisor monitors compliance but does not replace management or require court approval for ordinary business decisions. The debtor may enter new contracts, pay current suppliers, and collect receivables without restriction. The only limitation is that transactions outside the ordinary course of business – asset disposals above a statutory threshold or new secured debt – require the supervisor's written consent.

Q: How long does the arrangement supervisor's appointment actually take?

A: The appointment is a private contractual matter between the debtor and the licensed advisor. It can be completed in one business day once the parties agree on terms. The four-month statutory clock starts from the date of the Court and Commercial Gazette publication – not from the signing of the engagement agreement. Debtors who delay publication after signing the agreement lose protection days unnecessarily. The publication itself takes two to five business days depending on submission timing.

Q: Does PZU protect against tax enforcement by the National Revenue Administration?

A: Yes, but with a nuance. From the date of the Court and Commercial Gazette publication, enforcement against assets covered by the arrangement is suspended – and tax claims arising before the opening date are covered by the arrangement. However, current tax obligations arising after the opening date must be paid on time. The Head Office of the National Revenue Administration retains full enforcement rights over post-opening tax debts. A company that enters PZU and then falls behind on current VAT or CIT obligations faces enforcement that the arrangement cannot block.

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 navigating simplified arrangement proceedings, remedial proceedings, and pre-pack structures. 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.