Introduction - The Italian Perspective on Restructuring
Italy has a range of procedures used to rescue business entities. The legislative framework is expected to be replaced by a new Insolvency Code, the Codice della crisi d’impresa e dell’insolvenza (hereafter referred to as the “CCI”) enacted in 2019 and which is due to come into force on 1st September 2021. Although the CCI envisages a comprehensive reform of the legislative framework on business restructuring and insolvency, it largely confirms the main elements of the current insolvency framework and transposes into law certain legal principles from case law.
The three types of restructuring processes described in the report are all covered by the EIR Recast. The concordato preventivo includes an optional stay and a cross-class cram-down. The other two procedures are different types of accordi di ristrutturazione dei debiti (purely consensual or binding on a minority of dissenting creditors) that envisage an out-of-court phase consisting of negotiation and reaching an agreement with creditors with a view to rescuing the company and is subject to court confirmation. The concordato preventivo is described in detail in the report as it most closely mirrors the provisions of the Preventive Restructuring Directive 1023/2019 (“PRD”).
The current trend shows a reduction in the numbers of concordato preventivo, which can be ascribed to a series of reforms that have progressively tightened certain requirements, and a growing interest in accordi di ristrutturazione dei debiti. This trend may be fuelled by the entry into force of the CCI, since it further tightens the requirements to be fulfilled in case of the concordato preventivo procedure.