Right, but they were asking about why the US called it that.

That would explain why i've never seen it.

So there's 2 different major kinds of "bankruptcy" that are most commonly seen here in the US.

Chapter 11 is the one you see a lot, which is basically "our debts are too big" and what happens is that the company generally restructures the debt, but is not relieved of it, and is allowed to continue operating. The idea is "they're making money, just not fast enough" and they keep making money and having to pay the debt, but maybe in a lower payment over a longer time, or similar. This allows for all the bullshit loopholes and IMHO shouldn't really exist, but it is what it is.

Chapter 7 is what most people think of when they call something bankrupt. Which is where the creditors come in and liquidate everything. Sports Authority is a great example of this, or Toys R' Us, where they basically had to shut down every store and sell everything off and close down.

There's also the illusive "chapter 13" which is where you eliminate debt through a repayment plan. This generally results in a shorter repayment window where you have to pay back some of your debts in a structured way, and then the rest is forgiven, but it's not particularly common from what I've seen.