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European Company and Financial Law Review

Ed. by Bergmann, Alfred / Fleischer, Holger / Goette, Wulf / Hirte, Heribert / Hommelhoff, Peter / Krieger, Gerd / Merkt, Hanno / Teichmann, Christoph / Vetter, Jochen / Weller, Marc-Philippe / Wicke, Hartmut

SCImago Journal Rank (SJR) 2017: 0.258
Source Normalized Impact per Paper (SNIP) 2017: 2.167

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Volume 15, Issue 3


Reflections on English Law Schemes of Arrangement in Distress and Proposals for Reform

Prof. Sarah Paterson
  • Corresponding author
  • Associate Professor of Law at the London School of Economics and Political Science. An earlier version of this paper was presented at the CLC Harris Manchester NUS Schemes of Arrangement Conference on 12 January 2017. The author is grateful to Jay Westbrook, John Armour and other participants at the conference for comments. The author is also grateful to Janis Sarra for comments. The usual disclaimers apply.London School of Economics und Political ScienceLondonUnited Kingdom of Great Britain and Northern Ireland
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Published Online: 2018-11-13 | DOI: https://doi.org/10.1515/ecfr-2018-0015

The English scheme of arrangement process has, in many ways, proved a reliable friend to distressed companies and their majority finance creditors in the decade following the financial crisis. However, experience of using the scheme process to achieve a debt restructuring has highlighted a number of areas where it could be improved for the present, or to make it more adaptable in the future. This article was written at a time when the Insolvency Service had launched a review of the corporate insolvency framework in the UK (and published many of the responses which it has received to the consultation), and the European Commission had published a proposal for a new Directive setting minimum harmonisation standards for restructuring law. Both the consultation and the proposal have significant implications for the reform agenda, and the Government has published its response to the UK consultation just as this article is going to press. This paper focuses on the introduction of a preliminary moratorium as a gateway to restructuring efforts, the crucial question of how to value the enterprise if a cram down mechanism is introduced and the role of the insolvency practitioner in the scheme context.

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Published Online: 2018-11-13

Published in Print: 2018-11-09

Citation Information: European Company and Financial Law Review, Volume 15, Issue 3, Pages 472–502, ISSN (Online) 1613-2556, ISSN (Print) 1613-2548, DOI: https://doi.org/10.1515/ecfr-2018-0015.

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