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Dear Members

I am delighted to report that we are heading for a record attendance in Amsterdam with 440 registrations for the main Congress and 80 for the academic forum... so far. It is not too late to register!

During the last year I was lucky enough to be able to travel as your President to a good number of our events, all of which were very successful. One notable highlight, which was also a very humbling experience, was to listen to the keynote address by Iryna Zharonkina at our Eastern European Countries' Committee Conference in Vilnius, Lithuania on the 19th of May. Iryna is the Component Leader on Property Rights Protection and Enforcement of the EU-funded Project “Support to Justice Sector Reforms and Digitalization in Ukraine” (Pravo-Justice II) Implemented by Expertise France. Her speech focussed on challenges before the justice system of Ukraine, on insolvency, and the EU support to Ukraine in this area. Hearing first-hand about the reality of administering justice in the circumstances, which included rostering with judges who are on the frontline, put a lot of my usual daily professional concerns and complaints into true perspective. The Inside Story in this edition sheds further light on current Ukrainian court practice, which has pushed the envelope due to war circumstances.

This will be my last introduction to the newsletter as president, before I hand over to Giorgio Corno with effect from the end of a conference in Amsterdam. 

It has been a great honor and a highlight of my professional career so far to have been entrusted with this role and to represent all our members (now standing at over 1300) for the last 12 months. When I took over last year, I expressed my primary ambition (and it is recorded in the minutes!) as being not to mess it up. As I settled into the role, I am glad to say, and I hope you will agree, that my ambitions grew and that this is reflected in our many achievements this year. 

These achievements have included several new co-operation agreements with national associations, growing membership numbers, recognition at UNCITRAL, record sponsorship support and robust financial performance overall. None of this would be possible were it not for the outstanding drive and support of our extended management team, each of whom has delivered on an ambitious program. I would also like to record my thanks to my partners and colleagues at Beauchamps for their support and, at times, their patience. I will take the opportunity to elaborate on the many people I need to thank at our conference.

And with that, I bid you adieu for now.

Barry Cahir
President, INSOL Europe

 

Barry Cahir
President of
INSOL Europe

 

This issue is kindly
sponsored by:

 

LETT

DLA Piper is a global law
firm with lawyers located
in more than 40 countries
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2023 Annual Congress Amsterdam - Last chance to register!

Join 440+ delegates in Amsterdam!

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2023 Academic Conference: Last chance to register!

Join 80+ delegates in Amsterdam!

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With thanks to our Academic Sponsor:

Building links with National Associations
 

As part of our ongoing membership development strategy, we have started a programme to develop a close relationship with the relevant National Association (or similar body) in each jurisdiction covered by our members. The purpose of this cooperation is to establish a close bond between the National Association and INSOL Europe so that:

  • both organisations may jointly work towards furthering the profession in the insolvency, business reconstruction and recovery market,
  • INSOL Europe is able to represent and give a voice to the National Association before European legislative bodies, and
  • to increase the flow of relevant information between the Associations and promote their respective professional events.

In addition, members of those Associations receive a special discount when joining INSOL Europe. Associations with whom we have a signed cooperation agreement are listed below, and more are in the pipeline:

Visit our Membership Development Committee page for more information, and the Country Coordinators page for a list of designated contacts within each country.

 
New platform for EIR Case Register - Lexis+

We are delighted to announce that LexisNexis is now hosting the case register for INSOL Europe on its new platform, Lexis+Lexis+ brings together the UK's leading legal research database and Practical Guidance content into one connected legal world, providing customers with a solution unlike any other on the market. The case register (which was previously hosted on Lexis Library) is now hosted on Legal Research in Lexis+. 

The INSOL Europe case register is a unique case abstract service providing summaries of over 800 judgments from the Court of Justice of the European Union and first instance and appeal courts of the EU Member States (and the UK) that consider a significant point relating to the Recast Regulation on Insolvency 2015/848 (or its predecessor, the EC Regulation on Insolvency Proceedings 1346/2000).

The abstracts are provided on behalf of INSOL Europe by national correspondents, practising or academic lawyers, covering each of the EU Member States and are academically moderated by Professor Reinhard Bork, University of Hamburg, and Dr Kristin van Zwieten, Oxford University.

For details of how to use and search the case register, see the accompanying ‘How to Guide’.

How do I access it?
Upon joining INSOL Europe, INSOL Europe members should have received an email with their username and password for the case register. Please contact Natasha Sable at INSOL Europe if you don’t have your LexisNexis password.

 

 

National Insolvency Statistics Update: Slovakia

Despite the implementation of the Preventive Restructuring Directive, the number of restructuring proceedings has not increased significantly, but on the other hand the number of insolvency proceedings has. This is the conclusion of a summary of the latest statistics on restructuring and insolvency proceedings in Slovakia, as reported by Dávid Oršula from bnt attorneys in CEE.

Preventive restructuring was introduced by the new Act No. 111/2022 Coll. on the resolution of imminent bankruptcy. With effect from 17 July 2022, the deadline for transposition of the Preventive Restructuring Directive, the Act complements the insolvency legislation of the Slovak Republic. 

The aim of the Act is to provide for the resolution of the situation of an entrepreneur threatened by bankruptcy due to imminent insolvency in a preventive procedure, which is an effective tool for early resolution of the debtor's situation in order to continue its activities and maintain its viability and, in particular, to prevent bankruptcy and subsequent insolvency.

Given external factors such as the COVID-19 pandemic, the war in Ukraine and record high inflation, it is difficult to assess the actual impact of the new law on insolvency proceedings in Slovakia. Nevertheless, we can conclude from the latest statistics that there has been a significant increase in the number of insolvencies.

Insolvency courts declared the assets of 277 legal entities bankrupt in 2022. This is the highest number since 2015, but comparable to the number of insolvencies in the pre-pandemic period. The value of identified assets of legal entities that finally went insolvent jumped to EUR 690 million last year. This is about two and a half times more than in 2021. The identified net turnover of bankrupt legal entities that went insolvent last year was more than EUR 429 million. This is about 2 % of the known turnover of non-financial corporations in 2021.

The increase in the number of bankrupt companies in the last two years is not only related to the downturn in 2020 caused by the granting of short-term temporary protection, but also to the amendment of the insolvency legislation. As of 1 January 2021, the insolvency rules changed for companies with assets and liabilities of up to EUR 1 million. The number of so-called small insolvencies rose to 68 in 2021, a quarter of all insolvencies. In 2022, there were already almost 100 companies that ended up in small insolvency, which is more than a third of all insolvencies.

Years ago, insolvency courts were approving dozens of restructurings a year, but this led to abuses. So that at the end of 2016, the government amended the insolvency law to tighten its conditions, and the number of restructurings fell sharply in the following years. In 2019, they reached an all-time low (only 13 restructurings). However, the last three years have seen a gradual recovery. Last year, the courts approved 26 restructurings, almost three-quarters of them in the first half of the year.

The latest statistics from the summer of 2023 signal a high workload for the insolvency courts. In August 2023, Slovak insolvency courts opened as many as 71 insolvency proceedings and declared the assets of 44 bankrupts bankrupt, the highest number in both cases since at least January 2018. Almost two-fifths of the insolvencies are so-called small insolvencies. At the same time, judges approved two restructurings.

To sum up, while the statistics show an increase in insolvency proceedings over the past year, this increase seems to be primarily a sign of a certain normalisation of the number of insolvency proceedings after the COVID-19 pandemic. We must also mention that the number of insolvency proceedings is still much higher than the number of restructuring proceedings. 

Further statistics from Slovakia and other jurisdictions can be found on our website here.

 

YANIL launches Academic Prize for Innovative & Outstanding Research

‚ÄčThe Younger Academic Network of Insolvency Law (YANIL) is pleased to announce the launch of the YANIL Research Prize for Innovative and Outstanding Research. With this Prize, YANIL aims to put the limelight on the excellent research produced by younger academics in the field of European insolvency and restructuring law. 

YANIL, a branch of the INSOL Europe Academic Forum, provides a lively and supportive network for younger academics to grow their academic talents. In pursuit of its objectives, various initiatives to present and publish research have been developed in recent years. 

A new challenge pressing YANIL is to ensure that the research of younger academics enjoys the attention it deserves and is disseminated as widely as possible. The refreshing ideas of younger academics, thanks to new questions, methods, or solutions proposed, are considered crucial for the development of the academic debate. With this new Prize, YANIL aims to raise awareness of their research and support them in pursuing an academic career.

Presenting the main findings in short videos
In order to raise the awareness for the research, the Prize involves several opportunities to present the research. This includes creating a short video in which the main findings of the research are presented. The video will be submitted by the applicants along with their research output. The videos of the winning applicants will be considered for publication on the YANIL/INSOL Europe and BWILC website, along with an abstract of their paper.
  
Three Prizes for younger academics
The jury of this first edition of the Prize is comprised of the board of YANIL (Gert-Jan Boon, Giulia Ballerini, David Ehmke, Emilie Ghio, Jonatan Schytzer and Eugenio Vaccari) and the chair of the IEAF (Prof. Rodrigo Rodriguez).

For this year’s edition, three prizes may be awarded: 1st place EUR 750; 2nd place EUR 500; 3rd place EUR 250. The winners will also be invited to present their paper at an online YANIL research seminar that will take place at the beginning of 2024. 

Participating
The deadline for the submission is 4th November 2023. This edition welcomes submission for research that has been published (or is under review) in the period January 2022 to September 2023. 

This prize is made possible with the financial support of the Foundation Bob Wessels Insolvency Law Collection (BWILC). 

More information on the YANIL Prize for Innovative and Outstanding Research can be found here. 

Inside Story: Pushing the envelope in times of war

Insolvency-Related Judgments and Ukraine’s Recent Insolvency Court Practice

Russia’s military aggression against Ukraine since 24 February 2022 not only dramatically changed the lives of millions of Ukrainians, but inevitably triggered the need ‘to move faster’ and re-adjust to new war-related circumstances. The law and judiciary are no exception. 

This Inside Story aims to briefly shed light on Ukrainian recent landmark court practice in insolvency cases, which has pushed the envelope due to war circumstances and given a green light to consider the debtor’s claims on compensation of damages caused by Russia’s aggression against Ukraine at the location of and within the debtor’s pending insolvency case in Ukraine.

Naturally, this case further provides food for thought as to the prospects of qualifying such a court decision as ‘an insolvency-related judgment’ for the purposes of future recognition and enforcement thereof abroad with the view to the UNCITRAL Model Law On Recognition and Enforcement of Insolvency-Related Judgments (‘MLIRJ’).

Read the full story here by Dr Olha Stakheyeva-Bogovyk, Attorney-at-law, Ukraine; Associate, McDermott Will & Emery UK LLP.

Read all past Inside Stories on our website here.

Member News: Judicial Reorganisation Proceedings at Air Belgium

Following a series of external events that have weakened the company in recent years, Air Belgium decided to review the company’s development strategy. It wishes to concentrate henceforth on its two growth-generating B-to-B activities, namely cargo and ACMI for passenger and cargo flights, and to discontinue its own Passenger business, which in the face of increased competition is proving to be chronically unprofitable to date. 

In order to manage and address its current debt, Air Belgium filed for judicial reorganisation by way of amicable agreement. 

Air Belgium’s counsel is Strelia, a law firm based in Brussels and its core Insolvency & Restructuring team, composed of INSOL Europe Council member Bart De Moor, partner, and Marine Callebaut and Sofie Onderbeke, associates, as well as other lawyers of the firm.

Air Belgium SA is a company under Belgian law. Air Belgium's activities rest on three pillars: long-haul passenger flights at competitive rates for both business and leisure passengers, cargo flights and flights for numerous renowned foreign airlines, tour operators, cruise companies and both Belgian and foreign governments (ACMI/Law Lease). The aviation sector has gone through numerous disruptions over the last three years that have severely impacted the profitability of passenger operations for airlines, and Air Belgium is unfortunately no exception. 
    
Faced with a more than unstable socio-economic and geopolitical environment, Air Belgium has taken a number of decisions to ensure the long-term viability and growth of the company which has a staff of 500 people, namely (1) to concentrate on the two profitable lines of business that offer growth prospects: cargo and ACMI, (2) discontinue the Passenger business, and (3) initiate judicial reorganisation proceedings by way of amicable agreement to ensure the company’s long-term viability and growth and to give it time to reorganise internally around these two segments. The purpose of the judicial reorganisation proceedings is to ensure the company’s long-term viability.

Fraud Conference 2024 - Save the date!

Returning for a fourth year on 29 February 2024, the Fraud Conference brings together world class speakers including policy makers, insolvency experts, fraud specialists and academics, offering unique insights on developments in the world of fraud. Hosted by the Fraud Advisory Panel, INSOL Europe and R3 this year’s event will be live and in person. More details and the programme to be announced here.


We welcome feedback, news and story ideas for future newsletters. 

Please send your suggestions to Paul Newson, CEO & Communications Manager,
email: paulnewson@insol-europe.org.

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Disclaimer: This newsletter is sent to members of INSOL Europe. No responsibility legal or otherwise is accepted by INSOL Europe for any errors, omissions or otherwise. The opinions expressed in the articles that appear are not necessarily shared by any representative of INSOL Europe.