Insolvency advice; application for recognition as a "suitable body" within the meaning of the Insolvency Code

You can be recognized as a "suitable body" within the meaning of Section 305 (1) No. 1 of the German Insolvency Code (InsO). As a recognized body, you may advise or represent the debtor when applying for and conducting insolvency proceedings.

If consumer insolvency proceedings are to be carried out, the debtor must submit a certificate issued by a suitable person or body in accordance with Section 305 (1) InsO stating that an out-of-court agreement with the creditors on debt settlement on the basis of a plan has been unsuccessfully attempted within the last six months prior to the application to open proceedings.

Members of the legal professions (e.g. lawyers, notaries, tax advisors) are considered "suitable persons" and do not require state recognition as a "suitable body".

Recognition as a "suitable body" within the meaning of section 305 (1) no. 1 InsO is granted by the relevant district government (Art. 112 (1) of the Act on the Implementation of Social Laws - AGSG). This requires an application for recognition as a "suitable body".

Natural or legal persons, e.g. a welfare association, a municipality, a commercial sole trader or a commercial company, are eligible to apply.

The application must be made in writing (Art. 114 para. 1 sentence 1 AGSG). The district governments will send you the relevant forms and information on the required documents on request.

• Qualified certificate of good conduct for public authorities according to § 30 Abs. 5 BZRG (Bundeszentralregistergesetz) for all employees and authorized representatives
• Documents on the professional careers of all employees
• Declarations by the applicant that:
  • no criminal proceedings are pending
  • there is no legally binding conviction
  • no bankruptcy/insolvency proceedings have been initiated
  • economically orderly circumstances are present (documents)
  • no credit/financial mediation services are being operated
  • information from the debtors' register of the local court
  • no simultaneous activity for a debt collection agency is being carried out.
• Extract from the central business register
• Articles of association or partnership agreement
• Certificate of non-profit status of the association
• Property liability insurance
• Balance sheet for the last three years
• Concept and financing plan
• for commercial sponsors: draft fee schedule or fee agreement

The following requirements must be met and must always be verified:

1. The office is managed by a reliable person who also ensures the reliability of the individual employees.
2. The position is permanent and debt counseling is one of its main tasks.
3. At least one person with sufficient, regularly at least two years of practical experience in debt counseling works in the office.
4. The necessary legal advice is guaranteed.

Complaint to the competent Bavarian administrative court

The insolvency advice center may only commence its activities after recognition by the respective district government. If the respective competent district government has not decided on an application for recognition within a period of three months after receipt of the application including the complete documentation, recognition is deemed to have been granted (Art. 114 para. 1 sentence 3 AGSG).

The district government charges fees for the approval procedure in accordance with the time required for the examination.
The decision on costs is based on Art. 1, 2, 6 para. 1 sentence 1 of the Costs Act (KG; BayRS 2013-1-1-F) in conjunction with tariff no. 7.VI.10/Insolvency Advice of the List of Costs (KVz; BayRS 2013-1-2-F). Tariff no. 7.VI.10/insolvency advice of the schedule of costs (KVz; BayRS 2013-1-2-F).

The costs amount to between €25.00 and €500.00 for agencies that do not belong to an umbrella organization of independent charities.
No costs are charged for agencies of non-profit organizations that are affiliated with an umbrella organization of independent welfare organizations.

The Free State of Bavaria offers electronic processing of payment transactions at https://epay.bayern.de/eps-payplatform/start for payments to the Staatsoberkasse Bayern.

Since 01.01.2019, the independent cities and districts have been responsible for providing insolvency advice. In doing so, they act within a delegated scope of action (Art. 113 Para. 1 of the Act on the Implementation of Social Laws (AGSG)).