Segnalazione da ESM - MES: How harmonisation of Europe’s insolvency laws could help businesses

How harmonisation of Europe’s insolvency laws could help businesses

Running a business is no small feat and not all ventures last. When a company faces insolvency, an inability to pay the bills, it brings stress for the business owner and potentially culminates in a fatal blow: bankruptcy.

According to Eurostat data, bankruptcies were on the rise in 2023 for the European Union (EU), hitting a record high in the second quarter,^[1] though they eased in the fourth quarter.^{[2] [3]} Still, they remain above pre-pandemic levels.

In the world of international finance, navigating the complexities of corporate insolvency processes, particularly across borders, can be tricky. As a former insolvency practitioner and trustee, I would often find myself grappling with the intricacies of different national insolvency laws when dealing with cross-border cases. The patchwork of various national rules often leads to inefficiencies and legal complications that hinder fair and consistent outcomes and can impede timely resolutions and the recovery of assets.

Harmonising the rules and procedures for insolvency cases across the EU would simplify the processes, minimise uncertainties, and allow for a more consistent and standardised approach. This would ultimately help reduce costs and increase the prospects of rescuing viable businesses. (...)