The Czech Ministry of Justice recently published a bill on preventive restructurings (the "Bill") implementing the directive on preventive restructuring frameworks which will introduce a brand-new legal tool preventing the insolvency of viable enterprises in temporary financial difficulties.
The Bill is now heading to the legislative process and should become effective from July 2022. Although it may still undergo some changes, it is already obvious that it will revolutionise Czech insolvency law.
Editorial | Restructuring Directive
This past Monday, July 26, marked passage of the most recent major milestone in the replacement of LIBOR as the benchmark USD interest rate. Following the recommendation of the CFTC’s Market Risk Advisory Committee (MRAC) Interest Rate Benchmark Reform Subcommittee, on July 26, 2021 interdealer brokers replaced trading in LIBOR linear swaps with SOFR linear swaps. This switch is a precursor to the recommendation of SOFR term rates. The switch does not apply to trades between dealers and their non-dealer customers.
Distressed transactions in bankruptcy court have become big business. Sales under Section 363 of the bankruptcy code provide predictability and reliability (in the form of a court order delivering “free and clear” assets) under even the most turbulent of circumstances. Commonly known simply as “363 sales,” these transactions can provide an opportunistic purchaser with significant upside under the right circumstances. But the truly opportunistic buyer will need to buckle up and be prepared to move with lightning speed in a highly competitive and transparent forum.
Though bankruptcy filings are down in 2021, the expiration of the Paycheck Protection Program and reopening of the courts nationwide could lead to a rise in bankruptcy filings with many businesses still struggling to cope with the economic and supply chain aftereffects of the pandemic and consumer purchasing habits. These bankruptcies, in turn, will have an inevitable ripple effect on creditors and other claimants, whose abilities to collect on claims and exercise rights, are significantly restricted by the automatic stay.
Am 16.06.2021 wurde von der Bundesregierung der Entwurf der neuen Restrukturierungsordnung (ReO), mit der die RL (EU) 2019/1023 (RestrukturierungsRL) umgesetzt wird, beschlossen (siehe hier).
The amendment to the Business Corporations Act effective from 1 January of this year (the "Amendment") brings, among other things, a significant change in the liability of members of a statutory body, which will affect the current topic of insolvency.
Members of a statutory body may now be liable in the event of insolvency for a much wider range of misconduct than was the case until the end of 2020. And not only them. The Amendment explicitly widens the range of persons to whom the new liability rules will apply.
On June 10, the Federal Trade Commission (FTC) filed an amended complaint for civil money penalties and other relief under Section 5 of the FTC Act prohibiting “unfair or deceptive acts or practices” and Section 521 of the Gramm-Leach-Bliley Act (GLBA) prohibiting the use of fraudulent statements to obtain consumer information.
On June 17, 2021, President Biden signed Senate Bill 475 into law, making “Juneteenth” a federal holiday. Because June 19th (tomorrow) falls on a Saturday this year, the day will be observed by federal government offices on June 18, 2021 (today).
This new law, revising the list of federal holidays in the U.S. Code, will affect consumer credit lenders’ operations. It is important for lenders to review their processes to determine how this new holiday will impact their operations.