If we file for corporate rehabilitation, can the company continue its operations?

Even if you file for corporate rehabilitation, as a general rule the company can continue to maintain its business operations.

This is because corporate rehabilitation is not a procedure for liquidating a company, but rather a system for adjusting debts and normalizing management while maintaining the business.

Accordingly, once the court issues a decision to commence rehabilitation proceedings, the company continues its existing business while carrying out the rehabilitation procedure.

However, after filing for corporate rehabilitation, the company's method of operation changes in some respects.

First, important managerial actions, such as the disposal of major company assets, new borrowing, or the provision of collateral, require the court's approval.

In addition, the company must report its financial situation and business status to the court, and it must prepare a rehabilitation plan setting out how debts will be adjusted and repaid during the rehabilitation proceedings.

Furthermore, if the court issues a stay order or a comprehensive prohibition order after the filing for corporate rehabilitation, procedures such as compulsory execution, seizure, and provisional attachment may be suspended or restricted, allowing the company to secure time to reorganize its financial structure while maintaining its business.

During this period, the company continues its business to generate revenue and, on that basis, pursues rehabilitation by repaying its debts in installments.

Daeryun Law LLC comprehensively analyzes a company's financial structure and debt situation during the corporate rehabilitation filing process and supports the entire process, from reviewing the feasibility of rehabilitation to preparing the rehabilitation plan.

In addition, by collaborating with in-house accountants, tax accountants, and others to analyze financial data and develop debt-adjustment strategies, the firm derives a realistic rehabilitation plan suited to the company's circumstances and provides close assistance so that complex procedures, such as matters requiring court approval, can be carried out smoothly.