Ranking of generally preferred claims under the GrIC

+ Add to binder

Recent Law 4336/2015 amended article 154 of the Greek Insolvency Code (GrIC) on the ranking of generally preferred claims, i.e. claims invested with a priority in the proceeds from liquidation of any and all assets.
Under the amended article, after the deduction of the costs of insolvency proceedings, including costs for the management of the bankruptcy estate, the fees of the syndic and claims from contracts entered into by the syndic, generally preferred claims rank as follows:
  1. Claims from any type of financing of the debtor, made with a view to secure continuation of its operations under a restructuring agreement (99 ff GrIC) or a restructuring plan (107 GrIC); claims of persons who have contributed goods or services for the same scope above and up to the value of such goods and services, including in both cases claims that arose from the commencement of the court proceeding and until the issue of the relevant judgment or the end of the (four month and any extension) term allowed under art. 104(1), to the extend preference is granted under the applicable provisions. Shareholder or partner’s claims for contributions in cash or in kind do not benefit from the above preferred status.
  2.  Labour claims that arose during the last two years before the opening judgment, termination of employment claims, irrespective of when they became due, claims for VAT and other withholding taxes, including penalties and interest and claims of social security organizations.
  3. Farmer and agricultural organisation claims from the sale of agricultural products, which arose in the course of the year before the opening judgment.
  4. Any type of State and local government claims, including corresponding penalties and interest.
  5. Claims of joint guarantee schemes applicable to the debtor if the debtor is or was an investment firm and such claims arose within two years from the opening judgment.    
(claims such as funeral costs, nutrition costs, and damages for disability, which are not relevant for legal entities are omitted)
Articles 155 GrIC on specifically preferred claims and 156 GrIC, under which if the proceeds from the liquidation are not sufficient for the payment in full of generally preferred and specifically preferred claims, the proceeds are divided and (i) one third is attributed to generally preferred claims and (ii) two thirds are attributed to specifically preferred claims, has not been amended.