Private International Law Rules in the Insolvency Regulation Recast: A Reform or a Restatement of the Status Quo?

Abstract

The European Parliament, after a lengthy debate, has eventually approved an Insolvency Regulation Recast, which amends Regulation 1346/2000 on cross-border insolvency proceedings. The Recast provides for significant innovations of the original Regulation, such as a EU-wide register of insolvencies or a new proceeding for insolvencies of corporate groups. The fundamental logic of the Regulation, however, has not been changed: the Recast does not harmonise insolvency rules at EU level and its goal is still selecting competent venues and applicable insolvency regimes. In many respects, the Recast simply codifies CJEU’s case law, with the aim of increasing legal certainty. The Recast is however innovative regarding the definition of COMI, by repealing the causality relation between criterions of “permanence” and “ascertainability”. Eventually, the Recast aims at better coordinating secondary proceedings and main proceedings; in this regard, it introduces “synthetic secondary proceedings”, whereby the insolvency practitioner of a main proceeding undertakes to respect other Member States distributional criterions in order to avoid the opening of a secondary proceeding. The real impact of these innovations is uncertain and depends on how national case law will interpret and apply the new rules.