Mapping of Preventive Restructuring Frameworks and the EU Directive: Specific Procedural Aspects of Preventive Restructuring in Domestic Processes and in the Directive
Chapter 8 explores the first half of Part III of the JCOERE questionnaire. The chapter begins with an exploration of the thresholds of insolvency in the contributing jurisdictions as this gives a perspective on the accessibility of preventive restructuring along the stream of financial difficulty. Secondly, Chapter 8 explores contributor responses to the implementation of article 5 Debtor in Possession. This requires Member States to provide a debtor in possession procedure while making provisions for the involvement of an insolvency practitioner, either on a case-by-case basis, or in certain specified circumstances. The chapter also looks at the interplay of article 8 of the EIR Recast, which provides absolute protection for rights in rem for assets located in a jurisdiction other than the jurisdiction of primary proceedings. This has been viewed as potentially conflicting with the cross-border aspects of preventive restructuring as it could lead to differential treatment of rights in rem holders as between the jurisdiction of preliminary proceedings and other jurisdictions recognising and deferring to those proceedings.