Some Observations on the New Group Coordination Procedure of the Reformed European Insolvency Regulation

Abstract

The recast of the European Insolvency Regulation introduces a new coordination procedure for handling insolvencies of groups of companies. The procedure relies on a group coordinator to create a helpful group insolvency plan while the individual insolvency proceedings remain independent. Albeit being a step into the right direction, the procedure has significant shortcomings such as the weak position of the coordinator, a liberal opt-in and opt-out mechanism and the problem of forum shopping. In the end, the new procedure can be a valuable tool in limited cases and should be merely seen as an addendum to a variety of possibilities to handle group insolvencies.