The present article addresses selected aspects around Luxembourg bankruptcy law which international creditors may encounter and should watch for when seeking to have their debtors declared bankrupt in Luxembourg or, on the contrary, trying to assess the bankruptcy risk when negotiating a distressed investment or a debt restructuring with a group or a structure having its key entities located in Luxembourg.
More particularly, the points addressed here are the following:
- Satisfying the "loss of creditworthiness" criteria;
- Facing oppositions after having had a debtor declared bankrupt;
- Relinquishing control to the trustee;
- Assisting with securing funding to initiate proceedings on the merits; and
- Luxembourg directors' duties in an insolvency context.
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