Over 70,000 businesses applied for gov't aid; bankruptcies skyrocket

Between 70 thousand and 80 thousand companies have applied for support at the coronavirus emergency desk since it opened on March 27, State Secretary Mona Keijzer of Economic Affairs said on talk show Op1. So far the government paid out around 58 million euros.

Keijzer stressed that the corona emergency desk is part of a much larger package of measures to support businesses through the coronavirus crisis.

But despite these measures, bankruptcies are skyrocketing. In the first week of April, almost 60 percent more companies were declared bankrupt than in the same period last year, BNR reports based on figures from the Chamber of Commerce and the Central Insolvency Register.

Insolvency lawyers told BNR that companies have other options than bankruptcy if their activities were brought to a halt by measures to curb the spread of Covid-19. Through "voluntary moratorium", for example, companies unable to pay their creditors can freeze those payments for the time being. They will have to keep paying their staff, however.

Another solution may be the Homologate Private Agreement Act (WHOA) that Minister Sander Dekker for Legal Protection submitted last year. This law allows companies in financial difficulties to restructure without creditors being able to claim outstanding debts. This law hasn't passed through parliament yet, however, and is still a way from being implemented.

Trade unions and employers are calling on the Minister and Tweede Kamer, the lower house of Dutch parliament, to hasten the implementation of this law, according to the broadcaster.