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Publicado el 20/5/2015
European Insolvency Regulation – Recast
On May 20, 2015 the European Parliament has adopted the recast of the European Insolvency Regulation (no. 1346/2000 of May 29, 2000). The reform had been initiated in late 2012 by a proposal of the European Commission and is now about to be completed.
The EIR recast substantially changes the regulation for cross-border restructurings and insolvency proceedings in Europe.
Schultze & Braun has highlighted the changes of the EIR recast in a document comparison and has compiled the most important documents in the legislative process.
Please follow this link to the Schultze & Braun website on the EIR recast.
The recast of the EIR differs from its predecessor – applicable since 2002 – in its scope (Art. 1) which now explicitly includes pre-insolvency restructuring proceedings and refers to the exhaustive list in Annex A. The provisions on international jurisdiction and on the COMI implement the case law of the ECJ thus far on Art. 3. To prevent abusive forum shopping, the presumption of the COMI at the seat of the legal entity does not apply if the debtor has relocated its corporate seat within the three-month period prior to the insolvency petition.
The new Art. 6 provides for far reaching jurisdiction for related actions which derive directly from insolvency proceedings and are closely linked with them, such as avoidance actions.
Secondary insolvency proceedings no longer have to be winding-up proceedings. However, the insolvency practitioner of the main proceeding can prevent a secondary insolvency proceeding by giving an undertaking to local creditors that their local rights will be recognized (Art. 36). Furthermore, in secondary insolvency proceedings far reaching duties to cooperate apply between courts and insolvency practitioners (Art. 41 seqq.).
Additionally, the EIR recast provides for the establishment of a European interconnected insolvency register (Art. 24 seqq.) and for a standardized lodging of claims (Art. 55).
Entirely new is the chapter on group insolvency proceedings with provisions on the cross-border cooperation of insolvency courts and insolvency practitioners from various insolvent group companies (Art. 56 seqq.) and on the new coordination procedure (Art. 61 seqq.). The general duty to cooperate already requires insolvency practitioners (and courts) to cooperate, exchange information and hear each other. Insolvency practitioners can coordinate a joint restructuring plan and request a stay of asset realisation measures. However, the duty to coordinate only exists to the extent that it is not incompatible with the local procedural rules and does not entail any conflict of interest.
The coordination proceedings provide a formal framework for cooperation by appointing an insolvency court involved as coordination court and an insolvency practitioner as group coordinator. The group coordinator outlines recommendations and proposes a group coordination plan (Art. 72) which the practitioners of the legal entities involved are obliged to consider, but not to follow. If a practitioner does not follow the coordinator and the plan, it has to give reasons for doing so to the local participants of the insolvency proceedings and to the coordinator (Art. 70).
The EIR recast enters into force on the twentieth day after its publication in the Official Journal of the European Union and applies (except for certain provisions) beginning with the second anniversary of its entry into force, i.e. approx. in June 2017, for all insolvency proceedings opened thereafter. For legal acts of the debtor before such date the respective prior law continues to apply (Art. 84, 92).
Attorney at Law in Germany Dr H. Philipp Esser, LL.M. (Chicago), Attorney at Law (New York State)