Business Restructuring

Potential impact

  • The Insolvency Regulation is the foundation of recognition of insolvency proceedings across the EU. It allows office holders acting as insolvency practitioners to recover and realise assets that may be located in another EU member state or where they are spread across a number of EU member states. Termination of this Regulation may, therefore, make it expensive and complicated for insolvency proceedings to be recognised and enforced in other EU member states when it comes to recovering and realising foreign assets.

  • Connected to the above changes, is the likely impact on where insolvency proceedings are commenced in cross border situations.

  • There is significant uncertainty surrounding EU funding, including grants and other loans and whether these will be affected by Brexit. As a result of changes in the funding landscape you may need to look at other ways of funding your business and you will need to plan ahead with a view to avoiding a distressed situation.

  • At present, member states can enforce judgments for recovery of debts relatively easily under the European Enforcement Order (EEO). This only applies to uncontested and undisputed judgments, but means that a judgment for such a debt can be enforced in the court of another member state. The EEO is another potential target for change during Brexit negotiations.

What to do at this stage

  • Alternative means of raising funding might be something our business restructuring specialists can assist with in terms of planning ahead.

  • If, following an assessment of your trading position in Europe, you feel that withdrawal from Europe could have a detrimental impact on the company’s finances and there is a need to plan ahead to avoid a distressed situation arising, our business re-structuring team can help guide you through various re-structuring options.