Abstract
The economic challenges of recent years have been accompanied by numerous and complex economic and social crises, the last of which is caused by the spread of coronavirus COVID-19 – and is convergent in nature, the effects of which are felt in all spheres of society. The COVID-19 pandemic poses serious challenges for politicians and preconditions for an empirical analysis of the direct and indirect consequences of the pandemic for the development of the global economy. As part of the business crisis, Italian legislation is based on the principles of the 2019 EU legal framework, which include legal regulation for the management of economic entities, which allows to anticipate the business crisis, avoiding bankruptcy and improving the market. Legal regulation of the financial crisis contributes to the preservation of production capacity and employment, reduces the possibility of creating non-performing loans, which can negatively affect the balance sheets of banking institutions. A study by the Bank of Italy demonstrates the possibilities of avoiding insolvency if companies anticipate a business crisis by following bankruptcy deflation procedures, such as debt restructuring agreements and agreements with creditors. COVID-19 has led to a significant reduction in world GDP. Governments have different financial means to reduce the negative effects of the pandemic, but all consider the current economic moment exceptional, trying to postpone and mitigate the implementation of bankruptcy of many companies and enterprises in case of failure of legal systems. The results of the study show that the global recession will continue, and no country will avoid strengthening the legal regulation of administrative and accounting management, regardless of the strategy to mitigate the effects of the pandemic. The paper forms the opinion that today’s events require a coordinated multinational political response to the pandemic. Keywords: corporate governance, financial markets.
Highlights
The economic context is increasingly complex and in recent decades we have had many crises, the last and most important is the one generated by the spread of the coronavirus - COVID-19, international legislators have introduced regulations that create a harmonious context, to protect the market and competition, the crisis that companies have to face due to the variability of economic conditions by introducing bankruptcy rules that tend to anticipate the emergence of financial difficulties, preserving the level of production and employment and avoiding situations of irreversible insolvency
Countries are dealing with the economic problems caused by the pandemic in a different way, but all are concerned about considering the current economic moment exceptional by trying to postpone and mitigate the application of the rules on the failure of their legal systems
The Italian legislation on the business crisis, which largely anticipates the EU legislation of 2019, provides for modern mechanisms which, by acting on the organization and governance of companies, make it possible to anticipate the emergence of the business crisis, avoiding bankruptcy and improving the market functioning mechanism
Summary
The economic context is increasingly complex and in recent decades we have had many crises, the last and most important is the one generated by the spread of the coronavirus - COVID-19, international legislators have introduced regulations that create a harmonious context, to protect the market and competition, the crisis that companies have to face due to the variability of economic conditions by introducing bankruptcy rules that tend to anticipate the emergence of financial difficulties, preserving the level of production and employment and avoiding situations of irreversible insolvency. The college acquires from the debtor, or upon his request, an updated report on the patrimonial, economic and financial situation of the company, as well as a list of creditors and holders of real or personal rights, with an indication of the respective credits and any causes of pre-emption It sets a deadline for the implementation of the crisis resolution measures, which can be three months, extendable for another three months, and instructs the panel's rapporteur, made up of three components, to follow the negotiations. Once the implementation and resolution of the crisis has been verified, the alert procedure is closed
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