Commission’s preventive restructuring proposals analysed

Author: | Published: 26 Jan 2017

The Commission’s proposed preventive restructuring frameworks would reduce differences between EU regimes but several issues need to be ironed out

On November 22 2016, the European Commission issued a proposed directive covering preventive restructuring frameworks, second chances for entrepreneurs and other measures intended to increase the efficiency of restructuring, insolvency and debt discharge procedures. If implemented, it would significantly close the gap between member states' existing restructuring and insolvency frameworks, placing a greater emphasis on corporate rescue and reducing the ability of shareholders and out of the money creditors to block a viable restructuring proposal.

The directive does not attempt to harmonise core aspects of insolvency legislation, such as the ranking of creditor claims. Instead, it focusses, as far as corporate debtors are concerned, on four procedural proposals which are intended to maximise the chances of a company with a viable business being able to restructure its debts rather...


 

 

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