Abstract
This paper contributes to the ongoing debate on the optimal design of reorganization procedures by studying the time-to-failure of unsuccessful reorganization cases in Belgium's insolvency system which offers the choice between multiple reorganization procedures targeted at firms of varying degrees of distress. Using mixture cure models, we show that time-to-failure determinants and differences across procedure types are consistent with the legislator's intentions. However, after the implementation of the flexible system under the 2009 insolvency reform, procedures remain lengthy and the financial situation of applicants poor, which may point towards stalling for time by distressed companies.
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