EU Restructuring Directive to Offer Ailing Cyprus Companies a Lifeline

On June 26, 2019, the Directive (EU) 2019/1023 of the European Parliament and of the Council of June 20, 2019 on preventive restructuring frameworks, on discharge of debt and disqualifications, and of measures to increase the efficiency of procedures concerning restructuring, insolvency and discharge of debt, and amending Directive (EU) 2017/1132 (the “EU Restructuring Directive”), were formally published in the Official Journal of the European Union, the Cyprus Mail reported. To date, EU legislation in the area of corporate insolvency and restructuring has been limited mainly to cross-border recognition and cooperation, whereas according to the EU Restructuring Directive, by July 17, 2021, all EU Member States must transpose its provisions in their respective insolvency and restructuring laws with the aim of harmonizing the future landscape of the European restructuring market. Greece has also adopted a new integrated insolvency framework, enacted by the Law for the Settlement of Debts and Provision of a Second Chance, adopted in October 2020. The new Law introduces a unified code for the restructuring and bankruptcy of individual and corporate debt for the first time in the country’s history. Read more.