The EU Recommendation on Business Rescue – Only Another Statement or a Cause for Legislative Action Across Europe?

Abstract

On March 12, 2014 the European Commission presented a "Recommendation on a New Approach to Business Failure and Insolvency" that is has two major objectives. The Commission wants to ensure that viable enterprises in financial difficulties, wherever they are located in the Union, have access to national insolvency frameworks which enable them to restructure at an early stage with a view to preventing their insolvency, and therefore maximize the total value to creditors, employees, owners and the economy as a whole. The Recommendation also aims at giving honest bankrupt entrepreneurs a second chance across the Union. The paper explains and discusses the Recommendation and its fallout.

Keywords: business rescue, EC recommendation, harmonisation, EU insolvency law, bankruptcy