Bankruptcy
The procedure through which the insolvent debtor's assets are sold in an orderly fashion and the proceeds are distributed to creditors in the legal order of priority.
Bankruptcy is opened when the debtor's recovery is no longer possible or the reorganisation plan fails. The judicial liquidator takes stock of and sells the debtor's assets, and the proceeds are distributed to the creditors in the order of priority established by law.
The procedure seeks to maximise the recovery of claims and ends with the closure of the procedure and the striking off of the debtor company.