Harmonising European Insolvency Law: The Emerging Role of Stakeholders

• Date: 01 June 2018
• DOI: http://doi.org/10.1002/iir.1303
• Published date: 01 June 2018
• Author: Gert‐Jan Boon

Harmonising European Insolvency Law: The

Emerging Role of Stakeholders

Gert-Jan Boon*

,†

Leiden Law School, University of Leiden, Netherlands

Abstract

In recent years, the European Commission has given increased room for stake-

holder involvement in the area of insolvency and restructuring. In revising the Eu-

ropean Insolvency Regulation in 2012–2015 and preparing the proposal for a

directive on preventive restructuring frameworks 2016, the role and direct influ-

ence of stakeholders has been noteworthy. In these efforts, the Commission touched

upon a field of law characterised by diverse stakeholders with strongly opposing in-

terests. Following the active involvement of all stakeholders by the Commission, this

study examines what relevant stakeholders are, what their positions are with respect

to European Union insolvency legislation and what their role has been and can be

in legislative processes in the area of insolvency and restructuring. Copyright ©

2018 INSOL International and John Wiley & Sons, Ltd.

I. Introduction

Since the 2011 call of the European Parliament for legislative measures with re-

gard to insolvency proceedings in the context of EU company law,

1

reform of in-

solvency regimes has been prominent on academic and legislative agendas.

2

In

subsequent efforts, the Commission acted in a largely untapped area of

harmonising substantive insolvency law. A field of law characterised by diverse

stakeholders with strongly opposing interests, including, among others, the debtor,

the debtor’s management, shareholders, employees, financiers, secured and

*E-mail: j.m.g.j.boon@law.leidenuniv.nl

†

For this chapter, the developments with regard to

harmonisation of European insolvency law have been

stated as per 1 January 2018. At the same date all in-

ternet sources have been checked. The author is grate-

ful to the comments of the two anonymous referees.

The author also thanks Professor Bob Wessels for his

comments on an earlier draft.

1. European Parliament Resolution of 15 November

2011 with recommendations to the Commission on in-

solvency proceedings in the context of EU company

law (2011/2006(INI)).

2. Ian Fletcher and Bob Wessels, Harmonisation of Insol-

vency Law in Europe (Reports presented to the

Nederlandse Vereniging voor Burgerlijk Recht

(Netherlands Association of Civil Law)) (2012, Kluwer,

Deventer).

Copyright © 2018 INSOL International and John Wiley & Sons, Ltd Int. Insolv. Rev., Vol. 27: 150–177 (2018)

Published online 22 May 2018 in Wiley Online Library

(wileyonlinelibrary.com). DOI: 10.1002/iir.1303

unsecured creditors and tax authorities. In its approach, the Commission actively

involved all these stakeholders.

This article will discuss, what the author will call, the integrated stakeholder ap-

proach that the Commission pursues in harmonising European insolvency regimes.

Both in its revision of the European Insolvency Regulation (2000)

3

(EIR 2000) and

in its work on a proposal for a directive on preventive restructuring frameworks;

second chance and measures to increase the efficiency of restructuring; and insol-

vency and discharge procedures (‘Restructuring Directive’),

4

the role and direct in-

fluence of stakeholders is noteworthy. The questions in this article concern what is

a relevant ‘stakeholder’, why is the Commission involving them and whether –and

under which conditions –it is justified to involve stakeholders in designing and ex-

ecution of EU insolvency legislation.

This article is organised as follows. Section II will introduce the topic of stake-

holders in insolvency and will elaborate on some theories regarding stakeholders.

A technique will be proposed to distinguish and rank different types of stakeholders

based on their salience. Subsequently, in Section III, this approach will be applied

to define stakeholders in the field of insolvency legislation. In Section IV, the sen-

sibility of stakeholder involvement will be discussed by reviewing how the role of

stakeholders in insolvency law has evolved over time. Then, in Section V, the ap-

proach of the European Commission toward harmonising substantive insolvency

and stakeholders will be discussed. Section VI will turn to the sentiments of differ-

ent stakeholders on harmonisation. This will be followed by some recommenda-

tions to pursue, with the involvement of stakeholders, the Commissions’aim of

harmonising certain aspects of national insolvency regimes (Section VII). Finally,

Section VII draws some conclusions.

II. Exploration of the Stakeholder

The relevance of stakeholder involvement in the field of insolvency was advocated

by, for example, EU Commissioner Věra Jourová. The EU Commissioner for Jus-

tice, Consumers and Gender Equality touched upon this in her speech of 16 June

2016 held at the occasion of the 5th European insolvency and restructuring con-

gress where she spoke on the harmonisation process of European insolvency law.

The EU Commissioner emphasised the important role of practitioners and judges

to bring legislation alive and bring forward the benefits of legislation to the whole

of the internal market. But their involvement is also required in designing new leg-

islation. In particular, in drafting the new legislative instrument on substantive in-

solvency law, EU Commissioner Věra Jourová stated:

3. Council Regulation (EC) No. 1346/2000 of 29 May

2000 on insolvency proceedings (‘EIR 2000’) was re-

vised by the adoption of Regulation (EU) 2015/848

of 20 May 2015 on insolvency proceedings (recast)

(‘EIR 2015’).

4. European Commission, Proposal for a Directive of

the European Union and the Council on preventive

restructuring frameworks, second chance and measures

to increase the efficiency of restructuring, insolvency

and discharge procedures and amending Directive

2012/30/EU of 22 November 2016, COM(2016)

723 final (‘Restructuring Directive’).

Stakeholders in Harmonising EU Insolvency Law 151

Copyright © 2018 INSOL International and John Wiley & Sons, Ltd Int. Insolv. Rev., Vol. 27: 150–177 (2018)

DOI: 10.1002/iir