Zelensky signs law to improve bankruptcy procedure

President Volodymyr Zelenskyy signed a law to improve the bankruptcy procedure and bring it closer to European standards. This includes the introduction of preventive restructuring. UNN reports this with reference to the document card No. 10143. 

The Law is titled "On Amendments to the Bankruptcy Code of Ukraine and Other Legislative Acts of Ukraine on the Implementation of Directive 2019/1023 of the European Parliament and of the Council of the European Union and the Introduction of Preventive Restructuring Procedures". 

According to the explanatory note to the document, one of the objectives of implementing EU Directive 2019/1023 is to unify the relevant legislation of the EU Member States in order to introduce common rules for preventive restructuring throughout the EU, which requires Ukraine, as a candidate for EU membership, to properly and efficiently implement EU Directive 2019/1023 into the national legislation of Ukraine.

The Law shall enter into force and come into effect three months after its publication, except for the provisions on preventive restructuring, which shall enter into force six months after the date of entry into force of this Law

Oleksiy Movchan, Deputy Chairman of the Committee on Economic Development, previously reported that draft law No. 10143 would introduce the institution of preventive restructuring.

This means that Ukraine, like the EU countries, will have a tool to prevent insolvency for businesses

The main provisions of the draft law are as follows:

• the benefits of the new procedure for business;

• the difference between preventive restructuring and out-of-court reorganization;

• the moratorium;

• enforcement proceedings;

• process administration;

• detecting early signs of insolvency;

• voting procedure, influence of stakeholders on the procedure.