A key objective of the current German coalition government is the reform of the clawback provisions in the German Insolvency Act (Insolvenzordnung - InsO). To address this, the German Federal Ministry of Justice and Consumer Protection recently published a draft bill for discussion.

The German government is expected to remain in office until 2017, making it highly likely that this reform will become law, in the course of 2015-2016.

Background and objective of the reform

Restructurings are all about alternatives. It is one thing for a creditor to hold an instrument that entitles it to payment of $X on Y date. But if the debtor does not have the cash to satisfy the obligation when due, some type of restructuring must occur.

As the name suggests, the UNCITRAL Model Law on Cross-Border Insolvency 1997 (Model Law) seeks to address complexities caused where insolvencies cross borders, while leaving substantive insolvency laws of each country largely unaltered. However, as jurisdictions continue to adopt and interpret the Model Law, inconsistencies in its application are coming to light.

Impending major reform of German insolvency clawback regime 

Reconsidering the Lasmos approach to winding-up petitions involving arbitration clauses.

Bankruptcy Code protects certain Ponzi scheme payments. The trustee for debtor Bernard L. Madoff Investment Securities (BLMIS) sued to avoid fictitious profits paid by BLMIS to hundreds of customers over the life of the Madoff Ponzi scheme. The defendant customers moved to dismiss certain of these avoidance claims pursuant to 11 USC Sec. 546(e), which shields from recovery securities-related payments made by a stockbroker. The trial court agreed that Sec. 546(e) barred the claims, dismissing them, and the Second Circuit affirmed.

Directive 2019/1023 of 20 June 2019 on preventive restructuring frameworks, on discharge of debt and disqualifications, and on measures to increase the efficiency of procedures concerning restructuring, insolvency and discharge of debt, and amending Directive (EU) 2017/1132 ("Directive on restructuring and insolvency")

It used to be the case that mortgage creditors could rest easy knowing they held a mortgage, and that they would be repaid with the proceeds of the sale of the mortgaged asset, even in the event of an insolvency.

In Budimex SA (C224/18), the CJEU was asked by a Polish Court to determine the time of supply in relation to a construction contract where no invoice was issued in accordance with articles 63 and 66 of the Principal VAT Directive (PVD), which provide that the chargeable event for VAT purposes is when the services are supplied.

Following a lengthy process which started in 2012 aiming to reform the Romanian insolvency framework as part of a wider judicial reformation program, the New Insolvency Law (Law no. 85/2014 regarding the prevention of insolvency and the insolvency proceedings) entered into force on 28 July 2014.