European Union: Insolvency/Bankruptcy/Re-Structuring

Despite hosting over 40,000 VC-backed tech startups and creating more of them than any other region globally, the EU had only 331 unicorns, as compared to 1,963 in the US as of 2025. The numbers highlight a structural challenge: European companies have been struggling to scale up and compete globally for some time, and a growing number of European high-growth startups are relocating their headquarters outside the EU, primarily to the US.

This article is part of a series exploring court actions available under the Companies Act (Chapter 386 of the Laws of Malta).

The Luxembourg government has filed a bill of law proposing targeted amendments to the country's securitisation framework, building on 2022 reforms to address evolving market practices. The proposed changes focus on expanding financing methods, strengthening insolvency protections, enabling compartment-to-compartment investments, broadening security package flexibility, refining active management rules, and clarifying statutory subordination provisions for securitisation vehicles.

A draft bill introduces a new 72-instalment settlement scheme for debts owed to Greece's AADE and e-EFKA, covering overdue obligations from before December 2023. This article examines the eligibility criteria, interest rates, and enforcement suspensions under the new scheme, while comparing its advantages and limitations against the existing out-of-court debt settlement mechanism to help debtors determine the most suitable restructuring option.

Pre-insolvency restructurings can fail when individual creditors block viable solutions to negotiate better outcomes. The insolvency plan's cram-down mechanism enables court confirmation despite dissenting votes, provided dissenting groups receive legal protection and aren't unduly disadvantaged. Understanding cram-down logic helps stakeholders assess restructuring options and risks before insolvency occurs.

Toda & Nel-lo sponsored the National Restructuring Congress organised by Tirant Formación, where Manuela Serrano spoke as a panellist addressing the main challenges of the current corporate restructuring framework.