Two German insolvency-law instruments that preserve management continuity while accessing the protective and restructuring tools of formal proceedings.
Eigenverwaltung — Self-Administration
Eigenverwaltung is a form of insolvency proceeding under German law in which the existing management remains in office and continues to run the business, supervised by a court-appointed Sachwalter (custodian) rather than replaced by an insolvency administrator.
It is available where the court is satisfied that self-administration is not detrimental to creditors. In practice, this requires solid restructuring planning, credible financial leadership, and — frequently — a CRO appointment that reassures the court and the creditors.
Schutzschirmverfahren — Protective Shield
Schutzschirmverfahren is a specific form of Eigenverwaltung that grants up to three months of court-protected breathing room for the company to develop a formal restructuring plan (Insolvenzplan), without an insolvency administrator running the business.
The shield phase is not a holiday. It is a structured planning window, with creditor coordination, workforce communication, and stakeholder management running in parallel. The output is a binding restructuring plan that, once accepted, becomes the operating reality.
When to Use Which
StaRUG fits situations where the financial restructuring is contained and the operational business is healthy. Eigenverwaltung fits where deeper operational and contractual restructuring is required while preserving management continuity. Schutzschirmverfahren fits where time is needed to design that plan with formal protection from creditor enforcement.
All three preserve management continuity. The choice is driven by the depth of restructuring needed and the protection required during planning.