While the Czech government has not yet enacted the June 2019 EU Directive on restructuring and insolvency, it has proposed another debt relief measure, the Milostivé léto or 'Debt Jubilee'. This will give debtors the opportunity to discharge debts owed to the Czech state.

Background

The measure will provide relief for debts where interest repayments substantially exceed the principal amount. The measure follows on from the previous 'Debt Jubilee' between 28 October 2021 and 28 January 2022 when 42,000 debt enforcement proceedings were cancelled.

The new Slovakian preventive restructuring framework aims to provide companies with a viable toolkit to deal with financial distress at an early stage and to counter the fact that the majority of Slovak companies enter an insolvency process having been insolvent for more than a year.

Main characteristics

The court sanctioned one of two potential schemes of arrangement for Amigo Loans Ltd (Amigo) and approved a plan that provided for two possible outcomes.

Background

Amigo provided guarantor loans to customers with poor credit scores. Amigo owed customers and the Financial Ombudsman Service £375 million for customer complaints and was insolvent.

Introduction

The Insolvency and Bankruptcy Board of India (the Board) vide its circular no. IBBI/2022-23/GN/REG084 dated 14 June 2022, in exercise of the powers conferred under clause (t) of sub- section (1) of section 196 read with sections 7, 9 and 240 of the Insolvency and Bankruptcy Code, 2016 (the Code) has introduced the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) (Second Amendment) Regulations, 2022 (Amendment Regulations).

Amendments

Introduction

Background

German insolvency law prohibits managing directors from making payments on behalf of the company after it has become illiquid or over-indebted. This does not apply to payments made when acting with the due care and diligence of a prudent business manager. Such payments are privileged as they do not reduce the insolvency estate and do not disadvantage creditors if they allow the business to continue and enable corporate recovery.

Decision

Recently, by a judgment dated 30 May 2022, a three-judge bench of the Supreme Courtin the case of Kotak Mahindra Bank Limited versus A. Balakrishnan & Anr (Judgment dated 30 May 2022 in Civil Appeal No. 689 of 2021) held that a recovery certificate issued the Recovery of Debts and Bankruptcy Act, 1992 (RDB Act) would qualify as a “financial debt” under the Insolvency and Bankruptcy Code, 2016 (IBC), and give rise to a fresh cause of action under section 7 of the IBC.

After two years of lockdowns, Poland, like many other countries, is feeling the significant economic impact of Covid-19.

With the conflict in Ukraine, there is a risk that this economic turbulence will be magnified. Signs of uncertain times ahead include rising inflation and climbing interest rates. These are problems which will take time and effort to resolve. The government and parliament are proposing changes to legislation aimed at helping companies and entrepreneurs to conduct business “as usual” and to take the edge off the harsh realities.

The High Court has sanctioned the restructuring plan of ED&F Holdings Ltd, providing further clarity on the exercise of its discretion to sanction a plan using cross-class cram down.

Background

At the convening hearing, the court ordered that five creditor and two member class meetings be held. All but one of the creditor classes approved the plan by large majorities.

Sanction hearing

The Supreme Court of India in Indian Overseas Bank v M/s RCM Infrastructure Ltd. & Anr. held that a sale under section 13 of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (“SARFAESI Act”), would be regarded as complete only upon receipt of full consideration towards the sale properties.