Business & Law Research Network

BLRN Book Series

Recent publications in the BLRN book series can be found below.

Implementation of the EU Preventive Restructuring Directive Part I (BLRN-series part 1)

Coordinating editors: Gert-Jan Boon, Harold Koster & Reinout Vriesendorp (also authors)

The first part in the BLRN book series looks at the implementation of the EU Preventive Restructuring Directive.

In 2019, the European Parliament and the Council adopted the Preventive Restructuring Directive (2019/1023), providing for minimum harmonisation of, among others, preventive restructuring frameworks (PRF). This book provides in-depth analyses of its implementation in seven European countries: Austria, Denmark, France, Germany, Greece, The Netherlands, and the United Kingdom. Whereas Member States of the European Union were under a duty to complete implementation by July 2022, the United Kingdom took inspiration from it when voluntarily introducing reforms to its restructuring regime.

This book covers detailed analyses of the new or reformed PRFs across Europe, including the objective and scope of a PRF, the criteria/test to enter a PRF, the involved actors, the possibilities for a stay, the plan, the possibilities for a debt-for-equity swap, the effects of a PRF on executory contracts and jurisdiction and recognition of court decisions taken during a PRF. Drawing on the domestic implementations, the book also presents a comparative study evaluating the different policy options implemented by domestic legislators. This book functions as an insightful source for practitioners, academics and policy makers.

Implementation of the EU Preventive Restructuring Directive Part I (BLRN-series part 1) is available in open access. 

Versterking verantwoordingsketen (BLRN-series part 2)

Authors: Harold Koster, Cees de Groot, Tim Verdoes, Maaike Lycklama à Nijeholt, Jelle Nijland, Alette Jansen, Niek Strohmaier & Antoinette Rijsenbilt

The second part in the BLRN book series contains the elaboration of a study prepared for the Ministry of Finance by the Business Law Department of Leiden University. It includes proposals for interventions to improve chain responsibility regarding the processes of governance, risk management and control in the context of annual reporting and auditing and external communication about them. A key proposed intervention is the Risk Management Statement. Well-functioning internal risk management and control systems are crucial for good corporate governance. A number of interventions are also proposed in the areas of governance and conduct and culture that can contribute to strengthening the accountability chain. Furthermore, in the area of communication between the audited entity and its stakeholders regarding the way in which the engagement and oversight of the functioning of the external auditor takes place, some interventions are proposed that could improve this communication.

Versterking verantwoordingsketen (BLRN-series part 2) is available in open access. 

Evaluatie Wet homologatie onderhands akkoord

Authors: Jan Adriaanse, Marc Broekema, Arpi Karapetian, Harold Koster, Jessie Pool, Emil Verheul, Frank Verstijlen en Reinout Vriesendorp

The book ‘Evaluatie Wet homologatie onderhands akkoord’ contains the report of the evaluation study of the Wet homologatie onderhands akkoord (WHOA) (Act on the extra-judicial confirmation of restructuring plans) conducted by a research team from the University of Groningen and Leiden University, which was commissioned by the Scientific Research and Data Centre (WODC). On 1 January 2021, the WHOA entered into force. The WHOA allows viable but financially distressed companies to restructure their debts. This can prevent debtors from unnecessarily going bankruptcy, a loss of value of the debtor, as well as job losses.

The evaluation study shows that the WHOA broadly does what the legislator intended the law to do, to strengthen the reorganising capacity of debtors. Additionally, though to a slightly lesser extent, the WHOA appears to contribute to enhancing the voluntary settlement process, as it provides a clear framework for negotiations a restructuring, with parties engaging against the backdrop of this legal trajectory, and to the controlled settlement of a business through a liquidation plan. Moreover, in general, the statutory instruments of the WHOA seem to operate adequately. This pertains particularly to the options for granting a stay during which creditors cannot enforce their rights and the possibilities for extensions. Furthermore, the ability of courts to render interim decisions in in advance of the confirmation hearing on any issues relevant to the confirmation – so-called ‘aspect requests’ (aspectenverzoeken) – allows for early clarity and foreseeability for parties.

From the perspective of creditor protection, it is worth considering allowing this instrument to be used not only at ex officio by the court or at the request of the debtor or the restructuring expert, but also at the request of the observer, if deemed in the interest of securing the interests of creditors or shareholders. This would prevent these parties from raising their disapproval for the first time during the confirmation hearing, unintentionally leading to rejection of the plan. The ability under Article 42a of the Dutch Bankruptcy Act to protect new and interim finance (and related) transactions entered into during the WHOA process or as part of the plan against subsequent avoidance actions has been used limitedly. The same applies to option to terminate burdensome executory agreements of the debtor pursuant to Article 373 of the Dutch Bankruptcy Act. The researchers also note that accessibility of the WHOA by small businesses debtors could be improved. Unfamiliarity by these debtors of the WHOA plays a role here, but also the cost involved with conducting a WHOA process. The evaluation study contains some proposals for amending the WHOA.

This book series is published by the Business & Law Research Network (BLRN) of Leiden University. This research and expertise network conducts research on various aspects of doing business in the field of corporate and insolvency law. BLRN focuses in particular on topics such as corporate governance, sustainable entrepreneurship, mergers and acquisitions, and restructuring and insolvency.

Evaluatie Wet homologatie onderhands akkoord is available in open acces.