The number of insolvent companies in Romania increased by 10 percent at the end of 2011, compared to the beginning of the same year, to some 37,400, according to the Romanian ZRP Insolvency, part of the Zamfirescu Racoți Predoiu law firm. “According to some estimation, the insolvency services market amounted to some EUR 25 million in 2011, close to the level of 2010,” reads a statement of ZRP Insolvency.

Over 20,000 companies went insolvent during last year. Some 43.8 percent of the insolvency procedures were opened at the request of the creditor, while 56.2 percent - at the request of the debtor. According to Stan Tîrnoveanu, Managing Partner Zamfirescu Racoţi Predoiu, one of the reasons why the number of procedures opened at the request of the debtor is bigger, is the fact that the term for processing files in court is only five days in this case, while at the request of the creditors, the term is between six to twelve months.

Most affected areas in Romania were the real estate, construction, and retail. The economic crisis, lower funding and changing legislation were among the causes which triggered insolvency, along with the customers' lower purchasing power, unjustified investments and in some cases, even losing important contracts.

Romanian law firm Zamfirescu Racoţi Predoiu (ZRP) posted a turnover of EUR 4.5 million in 2011, up 35 percent over the previous year, according to the company. The growth in 2011 was sustained mainly by litigation on debt recovery and insolvency, which contributed over 60 percent to the company’s financial performance, but also by significant development of the company’s consulting projects portfolio.

Irina Popescu, irina.popescu@romania-insider.com

(photo source: Photoxpress.com)