The “Scheme of Arrangement” in English law
The English legal concept “scheme of arrangement” is an action under corporate law, which is now defined by part 26 of the English Company Act 2006 and which permits flexible agreements between companies and their creditors in the context of company restructuring. One of its characteristic traits is that no unanimous decision of the creditors is necessary for its acceptance, but that it can be achieved by way of a majority decision. If a majority of the creditors in number, representing at least 75 percent of the sum of the claims consent to the scheme, the other creditors who have not consented to the plan are also bound to it. The effectiveness of such an agreement is established by judicial approval. Due to the majority principle and the broad freedom of design, this instrument for reorganisation of continental European companies, too, has gained attractiveness.