The Preventive Restructuring Directive: A French perspective by Jean-Luc Vallens

The Preventive Restructuring Directive (“PRD”), which is about to be adopted by the European legislator, deserves the close attention of French practitioners, as it will become part of Book VI of the Commercial Code.

The PRD anticipates putting into place a framework for preventive restructuring that is both efficient and light: involvement of a judge is no longer considered indispensable (Article 4), except for a few matters: evaluation of the business’ financial situation, stays of individual action to permit the parties to negotiate and the approval of an agreement. The initiative is left to the debtors or, with their consent, to one of the creditors (Article 4).