A debtor who is insolvent can be declared bankrupt. Insolvency is defined in the Swedish Bankruptcy Act (1987:672) as being unable to pay one’s debts in a proper manner where such inability is not temporary. This applies to natural persons as well as companies.
The bankruptcy application can be lodged by the debtor himself or by a creditor. The application should be lodged with the court where the debtor is resident, or in the case of a company, where the debtor is established. The court decides on whether to approve or disapprove the bankruptcy application and appoints at the same time an official receiver. The bankruptcy decision will be published in the Official Swedish Gazette (“Post- och Inrikes Tidningar”) and in one or more newspapers in the applicable geographical area.
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