After more than two years of delay, preventive restructuring has finally become available to companies in financial difficulties in the Czech Republic. Czech companies can now seek to restructure their troubled businesses outside formal insolvency proceedings with the help of new rules specifically designed to keep their viable business operating and to prevent insolvency.

Currently, Ukrainian legislation does not provide for a separate “pre-pack proceeding” as outlined in the draft EU directive for harmonising insolvency law (“Directive Proposal”). However, selling a business is a legally feasible option under the Ukrainian Bankruptcy Code and related laws, both in a pre-bankruptcy phase and during bankruptcy proceeding.

In Poland, pre-pack insolvency sales have been available since 1 January 2016. The legal framework regulating pre-pack insolvency sales was introduced into Polish insolvency law as part of a major reform of insolvency legislation that was aimed at preserving the value carried by the assets of insolvent entities and to ensure higher satisfaction for creditors.

On 31 August 2023, the Romanian government passed emergency Government Ordinance (GEO 2023), which extends by 90 days the validity of the insurance policies issued by Euroins Romania Asigurare-Reasigurare S.A., which is now in bankruptcy. Prior to the issuance of GEO 2023, motor third liability insurance policies (MTPL) issued by Euroins Romania were due to expire on 8 September 2023 while the guarantee policies issued by this insurer were due to expire within 150 days after the opening of its bankruptcy procedure (i.e. 7 November 2023).

A pre-pack insolvency sale, which is an expedited liquidation proceeding that allow for the sale of all or part of a debtor’s business as a going concern to the best bidder shortly after the insolvency proceedings are opened, is not formally regulated in the Czech Republic.

The success of the recently introduced pre-pack-like rules in Hungary will help determined how the EU Directive on pre-pack sales will be implemented in this country.

Existing pre-pack-like rules

In the recent decision of Atlantic Sea Cucumber Ltd (Re), 2023 NSSC 231 the Supreme Court of Nova Scotia in Bankruptcy and Insolvency (the “Court”) departed from the long-standing norm in insolvency proceedings of granting an abridgement of time for filing and service of applications. The debtor company, Atlantic Sea Cucumber Ltd.

A “pre-pack” is a sale of all or part of a distressed company’s business or assets, negotiated before the company enters a formal insolvency process and executed by the appointed insolvency practitioner immediately after the insolvency process begins.

The recent decision from the Court of King’s Bench of Alberta (the “Court”) in Qualex-Landmark Towers Inc v 12-1- Capital Corp, 2023 ABKB 109 (“Qualex”) greatly extended the protective umbrella for costs associated with environmental reclamation obligations.

In Golfside Ventures Ltd (Re) (2023 ABKB 86) the Court of King’s Bench of Alberta (the “Court”) reaffirmed the Court’s authority to exercise inherent jurisdiction in proceedings under the Bankruptcy and Insolvency Act (the “BIA”) in circumstances where (1) the BIA is silent or has not dealt with a matter exhaustively; and (2) the benefit of granting the relief outweighs th