Intensive debate is currently under way in EU bodies on the proposal for a directive that could have a substantial impact on insolvency proceedings and the restructuring process in individual EU Member States. The proposal No. 2016/0359/COD[1] (“Proposal”) submitted by the European Commission envisages, among other things, the establishment of a legal framework governing informal restructuring of corporations’ financial engagement (“Informal Restructuring”).

One very serious problem associated with insolvency proceedings in the Czech Republic is submitting ‘vexatious’ insolvency petitions. In general, insolvency petitions are considered to be vexatious if they, in fact, pursue a goal other than that of resolving the debtor’s insolvency. Such petitions are often filed against financially sound entities in order to harm them in the eyes of their business partners and customers.

The Insolvency Act has significantly strengthened the position of creditors in comparison with the former Bankruptcy and Composition Act. Nevertheless, the position of a creditor is fundamentally affected by its voting rights, by which it may influence countless decisions.

However, many disputed issues arise in practice, for example, whether a creditor with a contested claim or a creditor affiliated with a debtor may vote. In this context, the new rules regarding voting rights cannot be ignored.

New regulation of voting rights for disputed claims