Selected restructuring issues in continental Europe - an illustration with Luxembourg
Many continental European jurisdictions do not have the statutory framework to deal with global group restructurings. As a result, many European restructurings have to address, at some point in time (i) the group concept or-lack thereof and how it influences restructuring negotiations; (ii) the lack of efficient in-court restructuring options for corporate groups; and (iii) the local recognition of foreign in-court restructuring proceedings. How does Luxembourg stand on these different aspects of the restructuring proceedings?

Many continental European jurisdictions do not have the statutory framework to deal with global group restructurings, either because their in-court insolvency proceedings lack flexibility or practicability, they do not have the relevant framework to incentivise out-of-court restructurings (including, for instance, provisions regarding standstill, restructuring plan recognition and creditor classes, creditor appointed administrators, etc.), or because they do not recognise the concept of a corporate group or conglomerate but instead focus on group entities being treated individually and separately, also in a distressed context. As a result, many European restructurings have to address, at some point in time (i) the group concept or-lack thereof and how it influences restructuring negotiations; (ii) the lack of efficient in-court restructuring options for corporate groups; and (iii) the local recognition of foreign in-court restructuring proceedings.
In this article, Anne-Marie Nicolas and Alvaro Garrido Mesa will explain the Luxembourg statutory framework to deal with global group restructurings.
Group Concept or lack thereof
- Lack of efficient in-court restructuring options for global corporates
- Bankruptcy as the only in-court option in Luxembourg
- Creditor’s struggles to control or influence the proceedings
The local recognition of foreign in-court restructuring proceedings
- EU proceedings
- Foreign (non-EU) insolvency proceedings
You can read the full article here.
Anne-MarieNicolas
Partner Attorney at Law / Avocat à la CourAnne-Marie Nicolas, partner, is a member of the Banking & Finance Practice Group in our Luxembourg office. She focuses on secured lending, including acquisition finance and real estate finance, as well as debt restructuring.
T: +352 466 230 314 E: anne-marie.nicolas@loyensloeff.comAlvaroGarrido Mesa
Senior Associate Attorney at lawAlvaro Garrido Mesa, senior associate, is a member of the Banking & Finance Practice Group in our Luxembourg office He focuses on domestic and cross-border finance transactions.
T: +352 466 230 280 E: alvaro.garrido.mesa@loyensloeff.com