German Finance Minister Olaf Scholz said on today that coalition parties have agreed to extend a freeze on insolvency rules put in place to avoid a wave of corporate bankruptcies due to the coronavirus crisis, Reuters reported. Speaking to reporters in Vienna, Scholz said that his centre-left Social Democratic Party (SPD) and Chancellor Angela Merkel’s conservative bloc sealed a compromise deal ahead of a coalition meeting scheduled later on Tuesday. In March, the government gave companies that find themselves in financial trouble due to the pandemic a respite by allowing them to delay filing for bankruptcy until the end of September. Justice Minister Christine Lambrecht, a Scholz ally and SPD member, had suggested extending the moratorium until the end of March 2021. But her plan drew criticism from Merkel’s lawmakers who said the waiver should expire at the end of this year. Scholz did not give any details on the agreement, but added that the deal would be announced later. A coalition member with knowledge of the talks told Reuters that parties had agreed to extend the insolvency waiver until the end of this year for indebted but still solvent companies.
