Creditors Arrangement Act

We resolve. You restart.

Creditors Arrangement Act

The Companies’ Creditors Arrangement Act (CCAA) is a specific measure for businesses with a minimum of $ 5 million in debts. This federal provision makes it possible to resolve the financial difficulties of a company by means of a restructuring made under the supervision of the court.

Companies with less than $ 5 million in debt also have access to a business turnaround process. However, the process does not go through the CCAA.

The benefits of the Companies’ Creditors Arrangement Act

The primary objective of this law is to promote the recovery of businesses so that they can avoid possible closings. The CCAA also offers certain benefits, including:

Maintain business activities.

Avoid bankruptcy and foreclosure.

Suspend the execution and realization – Optimize returns for creditors measures of the creditors .

Optimize returns for creditors.

Terminate or renegotiate certain contracts or agreements.

If you want to know more about this solution, the professionals at Ginsberg Gingras are available quickly. Thanks to their knowledge of the CCAA, you will get all the information you need regarding the legal procedures and obligations that govern this process.

Here is how a proposal works?

Initial request to be placed under the protection of the CCAA.
Issuance of initial order by court suspending creditors’ proceedings.
Preparation of the transaction plan which includes explanations on the planned restructuring and the proposal for reimbursement to creditors.

Appointment of a Licensed Insolvency Trustee (LIT) as Monitor. If a LIT has been assisting you since the start of the procedures, the latter can act as a monitor.
The court establishes the complaints procedure.
Presentation of the plan and vote of creditors.
Approval of the plan and distribution of payments.

Business recovery, a solution to debt

For a business turnaround to be successful, no detail must be overlooked. An in-depth analysis will help to target the cause of the debt and will influence the choice of strategy to implement. Clarifying the vision of the company and its objectives can also lead to a financially favorable reorientation.

The role of the monitor during a business turnaround

Acting as monitor, the LIT is a key player in a business recovery process. Its mandate is to see to the smooth running of the CCAA at each phase of the restructuring.

As monitor, he produces reports for creditors and the court, he acts as a resource person for stakeholders and convenes the creditors’ meeting.

Ginsberg Gingras, a business recovery aid

If you are considering using the CCAA or if you are inquiring for one of your clients, do not hesitate to call on our experienced LIT team. Our commercial insolvency professionals will tell you about corporate recovery measures and other solutions that may work.

If it turns out that the CCAA is the best solution to resolve the financial difficulties of your company or your client, our LIT will take care of all the steps to allow an orderly business recovery. This will allow you to focus on your role in the business while we take care of putting the finances in order.

Creditors Arrangement Act