Over the decade since the implementation of the costs reforms proposed in Lord Jackson's Review of Civil Litigation Costs, lawyers and litigants have become accustomed to the courts actively managing the costs of disputes with a value up to £10 million. But the court also retains a discretion to apply the costs management regime in cases even above this level.

In a recent decision in the high value bankruptcy of Pramod Mittal (Mr Mittal), the Chancery division considered the rules on service of insolvency applications. The decision underlines the importance of adhering to service rules and giving as much notice as possible of insolvency applications.

Many questions arise when a contractual partner enters into insolvency. One question is what happens with the debtor's ongoing contracts when the insolvency starts? Are they maintained or terminated?

One of the main principles governing insolvency proceedings states that the debtor's reorganisation should be sought before bankruptcy. To this end, the Romanian Insolvency Law (RIL) provides a series articles supporting the debtor's potential reorganisation.

Since the enactment of the new insolvency law in 2006, its proceedings have been amended many times to improve and simplify bankruptcy. In the past few years, the economic downturn has caused more and more companies to request court protection with the hope of undergoing reorganisation, realising that insolvency need not be the death of the company but, rather, a second chance.

The Romanian legal framework on insolvency procedure has been consistently improved following the enactment of Insolvency Law no. 85 (Law 85), which entered into force on 21 July 2006.

Background