Legislative changes in Singapore and the EU introduce pre-insolvency processes facilitating non-consensual debt restructurings or cram downs comparable to those already available in London and New York. In particular, the EU Recast Insolvency Regulation (the "Recast Regulation") came into effect on June 26, 2017, enhancing cross-border co-operation for applicable insolvency proceedings starting in the EU after that date.*

The European Commission (EC) announced proposals on 22 November 2016, which are intended to harmonise national insolvency laws across the EU through a proposed directive “on preventative restructuring frameworks, second chance and measures to increase the efficiency of restructuring, insolvency and discharge procedures” (Directive). The Directive will need to be passed by the European Council and European Parliament. Then, EU Member States would be required to adopt the Directive’s provisions into their respective national laws within two years from the date of its entry into force.

Accountability is the major theme of the recent government consultation regarding ‘Insolvency and Corporate Governance’, which follows high profile failures such as BHS and Carillion. The consultation contains proposals relating to four main areas as set out below.

Sales of businesses in distress

The proposal represents a significant extension of the current duties owed by directors. Under the proposal, a director of a parent company may be held liable for losses following a sale of a subsidiary if:

In recent months certain restructuring processes have gained quite some notoriety in press headlines in connection with a number of UK businesses. This article provides secured lenders with a brief recap on the key points to note in relation to CVAs (Company Voluntary Arrangements) and what Liquidation means in the context of Carillion.

Retail CVAs