The Development of Insolvency Procedures in Transition Economies: A Comparative Analysis

Abstract

In the past ten years all transition economies have adopted modern bankruptcy legislation as part of their institution building efforts. But their approach to insolvency and their determination to use the insolvency process as a selection mechanism have varied widely. The aim of the paper is two fold. Firstly, we identify the role of insolvency procedures in TEs, particularly in the orderly handling of financial distress and restructuring. Secondly, we analyse the recent developments in insolvency legislation in Bulgaria, Croatia, Czech Republic, Hungary, Poland and Romania, emphasising their inherent features and their impact on the restructuring process.

Keywords: insolvency law, bankruptcy, reorganisation, liquidation, creditors’ rights, exit