On 21 March 2012, following an in-depth investigation, the European Commission announced that it has approved the UK government’s plans to relieve the Royal Mail of excessive pension costs and to provide restructuring aid consisting of a debt reduction of £1,089 million. Read more.
ICMA’s European Repo Council has responded to the Commission's consultation on CSDs. Its main concerns focus on:
In the European Union, Stat e interventions in the market in the form of subsidies or other economic advantages are generally prohibited, but companies can receive aid from Member States if the aid is approved by the European Commission.
On 17 May 2011, the GC annulled a Commission decision requiring recovery of state aid from Polish steel producer Technologie Buczek (TB). The case concerned the actions taken by the Polish authorities in implementing a plan to restructure the steel industry. The GC found that the Commission had been correct to find that TB had benefited from a decision by the Polish authorities not to apply for bankruptcy but to allow the company to continue to operate without repaying its debts.
The European Commission has opened an in-depth investigation into plans to restructure the Royal Mail.
Summary and implications
Almost exactly one year on from the Order* coming into force, many people remain unaware that it is no longer possible to appoint an administrative receiver over an overseas incorporated company.
Lenders and indeed insolvency practitioners should be aware that this is the case even when dealing with qualifying floating charges created before 15 September 2003 but alternative strategies, including administration, may be pursued to the same effect.
Administrative receivership
Summary
In its communication on an EU framework for crisis management in the financial sector dated 20 October 2010, the European Commission set out several major legislative proposals aimed at preventing a repeat of the recent bank failures that necessitated significant state aid.
The Commission is consulting on the application of the current Community guidelines on State aid for rescuing and restructuring firms in difficulty. It has provided Member States and other interested parties with a questionnaire, on which it asks for responses by 2 February 2011.
The Commission is consulting on the details of a framework for dealing with failing banks. Following October's Communication on a crisis management framework, the Commission wants to make a legislative proposal on technical measures for dealing with relevant institutions in summer 2011. The consultation looks at how to give authorities across the EU powers and tools to restructure or resolve all types of institutions in crisis. It covers: