Since the European Commission adopted the recommendation on restructuring and second chance in 2014, it has been working on the evaluation of its initiative and the introduction of a European legal framework. In 2015 the Capital Markets Union Action Plan included the announcement of a legislative initiative on early restructuring and second chance. Finally, on 22 November 2016, the European Commission published its proposal for a European Directive on preventive restructuring frameworks and a second chance for entrepreneurs.

On 22 November 2016, the European Commission announced a draft directive on insolvency, restructuring and second chance in the EU in the form of the EU Business Restructuring Directive (the “Proposed Directive“) which can be read here.

On 22 November 2016, The European Commission announced a proposal for a new, more consistent approach to business insolvency across the member states of the EU. It is hoped that the proposed directive will create greater efficiencies in the insolvency process, enhance financial stability and provide greater certainty to investors and companies operating across the EU.

On 23rd November 2016, the European Commission released a package of banking legislation reforms. Some of these were expected in particular those related to the minimum requirement for eligible liabilities and own funds (MREL) under the Bank Recovery and Resolution Directive (BRRD) and the implementation of the Financial Stability Board's (FSB) total loss absorbing capacity (TLAC) principles into the MREL requirements.

Proposal for a directive of the European Parliament and of the council on preventive restructuring frameworks, second chance and measures to increase the efficiency of restructuring, insolvency and discharge procedures and amending Directive 2012/30/EU

As the dust begins to settle after the EU referendum and the potential ramifications of Brexit continue to be digested, we examine the potential impact of Brexit on the UK cross-border restructuring and insolvency regime and its consequences for the UK’s reputation as a leading creditor-friendly restructuring jurisdiction.

The EU referendum outcome - to "Brexit" has divided the country. Whilst supporters of both the "Remain" and "Leave" campaigns continue to speculate on what might have happened had the result been different, or what will happen if, as or when Article 50 of the Lisbon Treaty is invoked, the only apparent certainty is that these are uncertain times for the UK. Unprecedented, uncertain times.

For the benefit of our clients and friends investing in European distressed opportunities, our European Network is sharing some current developments.

Recent Developments

The process of Brexit will take many years, and the implications for our clients’ businesses will unfold over time. Our MoFo Brexit Task Force is coordinating Brexit-related legal analysis across all of our offices, and working with clients on key concerns and issues, now and in the coming weeks and months. We will also continue to provide MoFo Brexit Briefings on a range of key issues. We are here to support you in any and every way that we can.

Following the referendum…and after Brexit

Introduction