The restructuring & insolvency Q&A series provides a comprehensive overview of some of the key points of law and practice of the regulatory environment in Luxembourg. Today's chapter focuses on trends and predictions.

How would you describe the current restructuring and insolvency landscape and prevailing trends in your jurisdiction? Are any new developments anticipated in the next 12 months, including any proposed legislative reforms?

The restructuring & insolvency Q&A series provides a comprehensive overview of some of the key points of law and practice of the regulatory environment in Luxembourg. Today's chapter focuses on liability risk.

What duties do the directors of the debtor have when the company is in the “zone of insolvency” (or actually insolvent)? Do they have an obligation to commence insolvency proceedings at any particular time?

The transaction involved the restructuring of certain loan facilities via creditors' schemes of arrangement (Schemes). Prior to implementation, the Schemes terminated automatically by their terms as certain required payments had not been made by the relevant condition precedent satisfaction date.

The restructuring & insolvency Q&A series provides a comprehensive overview of some of the key points of law and practice of the regulatory environment in Luxembourg. Today's chapter focuses on cross-border / groups.

Can foreign debtors avail of the restructuring and insolvency regime in your jurisdiction?

The restructuring & insolvency Q&A series provides a comprehensive overview of some of the key points of law and practice of the regulatory environment in Luxembourg. Today's chapter focuses on insolvency.

What types of insolvency proceeding are available in your jurisdiction, and what are the benefits and drawbacks of each?

Earlier today, the Dutch House of Representatives (de Tweede Kamer) has voted in favour of the draft bill on “court sanctioning private composition to avoid bankruptcy” (de Wet homologatie onderhands akkoord ter voorkoming van faillissement, the WHOA), together with certain amendments.

This is great news: the WHOA is an effective restructuring tool that is likely to become widely used both in local and cross border restructurings. Especially in light of COVID-19, this is a welcome extra tool for enterprises in distress to avoid bankruptcy.

The restructuring & insolvency Q&A series provides a comprehensive overview of some of the key points of law and practice of the regulatory environment in Luxembourg. Today's chapter focuses on security.

What principal forms of security interest are taken over assets in your jurisdiction?

For immovable property, mortgages are generally the most common form of security taken in Luxembourg and may be granted in a legal, judicial or contractual manner. For a contractual mortgage to be validly constituted, it must:

The restructuring & insolvency Q&A series provides a comprehensive overview of some of the key points of law and practice of the regulatory environment in Luxembourg. Today's chapter focuses on the legal framework.

What domestic legislation governs restructuring and insolvency matters in your jurisdiction?

The statutory moratorium imposed by Royal Decree n° 15 to protect debtors affected by the coronavirus (COVID-19) crisis from their creditors is extended by decision of the Belgian federal government from 17 May 2020 to (and including) 17 June 2020.

The statutory moratorium imposes a stay on creditors’ right to enforce debts, terminate or dissolve existing agreements early and initiate bankruptcy proceedings and forced transfer of assets under judicial reorganisation.

The global economy has suffered a massive hit from the COVID-19 pandemic. The collective impact of disruptions to supply chains and falling consumer demand have caused many businesses to suffer varying degrees of financial stress with some having to recapitalise or refinance. While some M&A transactions on foot prior to the onset of the pandemic have been disrupted or delayed, the impact of the pandemic will open up opportunities for cashed-up funds and other buyers to, in time, take advantage of strategic and investment opportunities presented by the pandemic.