Clifford Chance
Reform Act improves creditor participation in selection of insolvency administrator - ILO
9 March 2012
On March 1 2012 the Reform Act on insolvency law, which aims to facilitate the restructuring of companies within insolvency proceedings, entered into force. The main scope of the act is to strengthen the creditors' influence throughout preliminary insolvency proceedings, particularly by involving the creditors at an early stage in the selection of the insolvency administrator. Under the old regime, the appointment of the preliminary insolvency administrator vested in the sole discretion of the insolvency courts, which were not always willing to listen to the main creditors' proposals. Under the new law, creditors have more influence on the selection of the preliminary insolvency administrator, which brings major benefits for creditors: the appointment of a cooperative and experienced practitioner is the key factor in the successful implementation of restructurings within insolvency proceedings. In most cases, the preliminary insolvency administrator will also act as the main insolvency administrator for the main insolvency proceedings.
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Reform Act improves creditor participation in selection of insolvency administrator - ILO
