A distraint order or freezing order allows for a fast and relatively simple seizure of property belonging to a debtor. However, the seizure is of a provisory nature.
After the successful execution of a distraint order, the creditor has to bring a court action for confirmation of his claim and to secure the seized assets. The distraint order serves as a preventive measure. By seizing certain assets of the debtor, the success of an ongoing or impending execution of an unsecured mature claim is protected.
Against persons not registered in the commercial register
Only such assets of the debtor are seized and liquidated as are necessary to satisfy the creditor pursuing debt enforcement. Multiple creditors can take part in such an action. Debt enforcement against persons not registered in the commercial register doesn’t result in the total liquidation of all the debtors assets.
Against persons / companies registered in the commercial register
Creditors can force a debtor with unpaid due debts into bankruptcy if they file a bankruptcy action in the bankruptcy court. This procedure is only available against persons and companies registered in the commercial register.
As a result, all debts become due immediately and all creditors participate. All assets of the debtor are liquidated to satisfy all debts.