The interview A code for Europe
Dr Daniel Staehelin is president of INSOL Europe, a pan- European professional association for restructuring and insolvency specialists. He works as an attorney and notary public at Kellerhals Anwälte Attorneys at Law and is an honorary professor at the University of Basel in Switzerland. He sat down with IFLR to share his thoughts on the state of cross-border insolvency proceedings in Europe
Could you briefly describe the state of European insolvency proceedings today, and developments expected over the next year? The main point is that each European state still has its own legal system, and Europe is divided between civil law states and common law states. There’s not a pan-European insolvency proceeding, but developments tend to facili-
tate restructuring instead of liquidation. There is a trend toward trying to keep the company operating, specifically in
Germany and France. There is also a discussion about unifying European insolvency and restructuring law, but this is still a long shot. The main problems are that there are dif- ferent privileges in each country: for example the privilege of labour. Each country tends to favour its own privileged entity during insolvency proceedings. France, for example, passed a special law that widens safeguard measures in response to the insolvency of Petroplus, a company based in Switzerland with a branch in France.
What impact has the European Regulation on Insolvency Proceedings had on cross-border restructuring plans? It has had a really big effect. It was the first successful attempt to force states to recog- nise insolvency and restructuring decrees from other countries. In many jurisdictions governing law was based in territorialism and you had to introduce a proceeding in every country for the implementation of a restructuring plan. Now you can introduce a pro- ceeding only in the country where the centre of main interest is situated and the decrees and judgments of any EU member-state have to be recognised by all other member- states. It’s really helpful. Some countries like England and France had already recognised foreign insolvency decrees, but other ones did not, and now proceedings are unified by the regulation.
So is a pan-European insolvency code needed? Yes, because if you have one economic market then you also need one insolvency code.
In which European jurisdictions do lawyers face the most challenges reaching in-court and out-of-court restructuring agreements? What advice would you give them?
www.iflr.com IFLR|RESTRUCTURING & INSOLVENCY 005
If you have one economic market then you also need one insolvency code
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