Bankruptcy means the insolvency of a debtor declared by court ruling. Bankruptcy can be declared for natural as well as legal persons. As per the Bankruptcy Act, the debtor may be declared bankrupt on the grounds of an outstanding claim: exceeding 12,500 euros in the case of a public limited company, 2500 euros in the case of a limited liability company, and 1000 euros in the case of other legal and natural persons.
Legislation regulating the main principles of bankruptcy proceedings: Bankruptcy Act, Trustee Act.
Liquidation proceedings are the liquidation of a legal person based on a decision of its owners or a ruling of the court.
Legislation regulating the main principles of liquidation proceedings: the Commercial Code of Estonia, Bankruptcy Act.