§ 166 InsO (administrator's right of realisation)

§ 166 InsO overrides the usual separation between collateral and the insolvency estate in favour of orderly, centralised realisation: where a moveable asset subject to a creditor's right of separate satisfaction (e.g. machinery transferred by way of security, or a receivable assigned as collateral) is in the administrator's possession, the administrator — rather than the secured creditor — may sell it privately or collect the receivable. The administrator must notify the secured creditor beforehand and give them a chance to point to a better realisation option (§ 168 InsO).

In return, §§ 170–171 InsO entitle the administrator to flat-rate cost contributions: 4% assessment costs plus (on a private sale, not on collection) a further 5% realisation costs, both on the gross proceeds — deducted before the secured creditor is paid and channelled into the estate. This mechanism is one of the main reasons insolvent estates still generate liquidity for the proceeding despite assets being mostly encumbered.

For buyers, § 166 InsO means in practice that even in an asset deal made up mostly of items transferred by way of security or subject to retention of title, negotiations typically run with the administrator as seller of a combined package — not separately with each bank or supplier. That simplifies the deal structure considerably, but makes secured creditors' buy-in on the agreed valuation all the more important, since they share directly in the sale proceeds via the cost contributions.