Countdown has begun to the biggest overhaul of
Germanys insolvency legislation, but lawyers predict
more amendments are needed if the proposed reforms are to be
According to Heiko Tschauner, head of business restructuring
and insolvency at Hogan Lovells in Germany, the
governments draft law known as ESUG (Act to facilitate
restructuring of companies) doesnt go far enough on some
Andreas Spahlinger of Gleiss Lutz in Stuttgart agreed that
more changes will be necessary to make German law fully
competitive and to stop local companies moving elsewhere or
using foreign restructuring laws.
Three major amendments are set to come into force next year
under ESUG. The first will make restructurings easier by
enhancing the role of creditors.
The idea is to strengthen the influence of creditors,
particularly as regards the selection of an insolvency
administrator said Spahlinger.