EU Directive Harmonising Insolvency Law: An Investment Opportunity

25 November 2025

The Council of the EU and the European Parliament have reached a provisional agreement on a new EU Directive that will harmonise key aspects of insolvency law across Member States. This development is part of the EU Capital Markets Union Plan and represents a significant step toward reducing the fragmentation of insolvency regimes in Europe, which has historically posed challenges for investors assessing cross-border risks in navigating up to 27 different insolvency regimes. This Directive once enacted is designed to help investors by providing greater legal certainty, comparability, and transparency across Europe’s insolvency regimes, making it easier to assess and manage cross-border investment risks.

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