Category: Insolvency

Insolvency Doctor Knock: not Prozac but Related Party Pre-Packs (RPPP’s)

A post by Rolef De Weijs, Luca Ratti & Johan Zwemmer

The EU wants to introduce pre-packs as a new type of insolvency procedure as a cure for financial failure. The French novel ‘Dr Knock’ provides a clear warning about doctors and medicines. Too much medicine weakens a healthy society. The following contains two spoilers. The first as to the plot of Dr. Knock. The second as to what will happen if the current EU Pre-Pack Proposal is adopted where it forces Member States to allow for Related Party Pre-Packs at the expense of creditors and employees.

The story of Dr Knock

The French novel Dr Knock (1924) by Romains tells the story of a doctor in a rural French town who wants to retire. The ambitious doctor Knock takes over the practice. The main problem is that the population is too healthy. Dr Knock, however, is of the opinion that healthy people are simply people that don’t realize they are sick. Dr Knock then offers each citizen a free consult, where he discusses new ailments and the risks of microbes. Soon half the population is under doctor supervision and the local hotel is turned into an emergency hospital.

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Insolventierecht: een synopsis in minder dan 4500 woorden

Insolventierecht is het recht van schaarste: waar aanspraken botsen en waarde moet worden verdeeld zonder dat elk kan krijgen wat hem krachtens het niet-insolventierecht toekomt. Deze schaarste dwingt het privaatrecht tot zijn scherpste keuzes. Insolventierecht is daardoor een zeer technisch en een zeer politiek rechtsdomein.

Het onderscheid tussen zakelijke dan wel persoonlijke rechten komt in alle scherpte naar voor in de insolventiehypothese. Waar het zakelijk recht een reële aanspraak geeft op een goed (un droit réel), heeft de schuldeiser slechts een hoopvolle verwachting van een toekomstige realisatie (une créance).

Continue reading “Insolventierecht: een synopsis in minder dan 4500 woorden”

Prejudiciële vraag bij Grondwettelijk Hof over de onmogelijkheid van weigering van kwijtschelding beperkt tot bepaalde schuldeisers

Orb Gent, 13 november 2025

Een nieuwigheid van het voorlaatste faillissementsrecht (2018) was de mogelijkheid van gedeeltelijke kwijtschelding bij verzet van een derde-belanghebbende. Dit gaf de rechtbank de mogelijkheid om in grijstinten te schilderen i.p.v. het oude zwart/wit- regime van de verschoonbaarheid. Daarbij rees de vraag hoe een gedeeltelijke kwijtschelding onder de schuldeisers moest worden omgeslagen: enkel voor de zich verzettende schuldeiser, voor alle schuldeisers, hoe rekening te houden met de rangorde?

Het nieuwe art. XX.173 § 3 al. 3 stelt sinds 1 september 2023 (n.a.v. implementatie Hestructureringsrichtlijn): “De door de rechtbank gedeeltelijk geweigerde kwijtschelding wordt evenredig verdeeld over alle schuldeisers zonder inachtneming van de wettige reden van voorrang.” Dit lijkt er vanuit te gaan dat een gedeeltelijke weigering altijd geldt voor alle schuldeisers en bestaat uit een breukdeel dat voor alle schuldeisers wordt toegepast (en geen absoluut bedrag dat dan verder de rangorde volgt).

Daarmee leek de wetgever komaf te maken met de mogelijkheid dat de rechtbank ook specifieke schuldvorderingen kan uitsluiten van kwijtschelding i.p.v. één globale gedeeltelijke weigering die alle schuldeisers ten goede komt (zie voorheen D. De Marez en C. Stragier, Boek XX. Een commentaar bij het nieuwe insolventierecht, 310, nr. 583 en hier).

We hebben deze inperking van de mogelijkheden van de insolventierechtbank op deze blog betreurd. Als de gehele of gedeeltelijke weigering van kwijtschelding een vorm van “bestuursaansprakelijkheid” is voor de natuurlijke persoon, dan is de mogelijkheid van gedeeltelijke kwijtschelding een manier om de sanctie af te stemmen op de schade die door de onrechtmatigheid werd veroorzaakt.

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The EU Proposal for Pre-packs with Related Parties – some critical notes and essential amendments

A post by Rolef de Weijs and Flip Schreurs

1. Harmonization of Pre-packs 

The European Union seeks to harmonize European Insolvency Law. It has proposed a Directive for the harmonisation of certain aspects of insolvency law across Member States, including pre-packs.[1] The Commission’s ambition is to have this Proposal for a European pre-pack adopted as a Directive already by January 2026 (“the Proposal”).[2]

A pre-pack is a prepared insolvency procedure in which the sale of the business to a new owner is arranged prior to the opening of insolvency proceedings. Normally, this sale process takes place in a closed bidding environment and even in secrecy, in order not to disrupt the business and to ensure value maximization for creditors. Once the company is declared insolvent, the first thing that will typically happen is that the court appointed trustee will transfer the business to the highest bidder coming out of the sale process.[3]

Pre-packs have a tainted reputation, at least in jurisdictions where they are being used.[4] In part this is due to the highly legal nature of a pre-pack which overrides what people see in the street. In case of a prepack, a company as legal entity is declared insolvent by the court, but the business uninterruptedly continues to operate with a new owner. Creditors can no longer pursue their claim against the business (which is transferred to the new owner) and will have to file their claim with the trustee of the bankrupt entity. As long as pre-packs are conducted with outside parties, there is however little room for abuse. The procedure would then simply seek to ensure that the business is sold to the highest bidder in the interest of the joint creditors.[5] The prevention of damage caused by disruption by ensuring a confidential preparation only maximizes value. If this is what the pre-pack is all about, there is little cause for the tainted reputation.

Continue reading “The EU Proposal for Pre-packs with Related Parties – some critical notes and essential amendments”

European harmonisation of Pre-packs: Initiating a European race to the bottom at the expense of employees

A post by Rolef de Weijs and Johan Zwemmer (University of Amsterdam)

1.
Towards a European pre-pack

    The European Commission has presented a Proposal for the harmonisation of rules on pre-packs.[1] A pre-pack is a prepared insolvency procedure in which the sale of the business to a new owner is arranged prior to the opening of insolvency proceedings. Once insolvency has been declared by the court, the sale is executed. The company as the legal owner will cease to exist, but the business will continue. The Commission’s ambition is to have this Proposal for a European pre-pack adopted as a Directive already by January 2026.[2]

    The Proposal states in its Preamble in clear and unambiguous terms that employees’ rights should not be prejudiced by the enactment of a European pre-pack:

    “The pre-pack mechanism should be without prejudice to employees’ rights under Union and national law, including the involvement of employees’ representatives.”[3]

    The Proposal as currently drafted, however, does exactly the opposite of what it says it will be doing. The Proposal effectively abolishes the most important European rules protecting employees during the transfer of business in which they are employed, contained in the Transfer of Undertakings and Businesses Directive,[4] by making it possible to circumvent this protection when the shareholder continues the business in a slimmed-down version using a pre-pack. The Transfer of Undertakings and Businesses Directive provides as a general rule that employees transfer along with a transfer of the business. Case law of the Court of Justice of the European Union provides employees protection under the Transfer of Undertakings and Businesses Directive in case an operating business is being transferred out of a pre-pack procedure to an old shareholder. Under the Proposal, this European rule of employee protection will be revoked facilitating pre-packs with old shareholders and related parties and leaving employees without any protection. The adoption of this Proposal would mark a chilling regression in the protection of workers’ rights across Europe.

    In bankruptcy, the trustee can in general dismiss all employees. As a consequence, employees do not necessarily transfer if an external party acquires an operating business out of bankruptcy, whether the proceeding is a pre-packaged bankruptcy or not. Such a transfer, also out of a pre-packaged insolvency procedure to an external party can qualify as a proceeding aimed at liquidation. Article 5 of the Transfer of Undertakings and Businesses Directive requires the insolvency proceedings to be aimed at liquidation in order for employees not to transfer along with the business. [5] If the insolvency proceedings are not aimed at liquidation and the business is transferred out of insolvency, the employees will transfer along with the business and will, by reason of this transfer, automatically enter into an employment relation with the acquirer. From the CJEU case law on the application of the Transfer of Undertakings and Businesses Directive, it follows that the former shareholder of a bankrupt company cannot acquire the business through pre-packaged bankruptcy proceedings in order to continue it in a slimmed-down form without all employees transferring along with the business. Such a procedure, resulting in the former shareholder continuing the business in a new legal entity, cannot be deemed to constitute an insolvency proceeding ‘aimed at liquidation’.

    The Proposal will simply disable the application of the Transfer of Undertakings and Businesses Directive to all prepacks – both those involving a former shareholder of the bankrupt company and those involving an acquirer unrelated to that shareholder- and thereby render irrelevant the case law of the CJEU on the Directive’s application in the context of pre-packs.[6] The Proposal bluntly states that each and every pre-pack is aimed at liquidation.[7] This is odds with reality. A substantial share of pre-packs is undertaken to enable shareholders of a company to continue the business in a new legal entity, free from old debts and without the obligation of the company towards its employees. In these so-called related-party pre-packs, the business is essentially continued by the same owner through a new company. The Proposal provides that, in the case of such pre-packs, employees will no longer be protected by European rules in the context of business transfers.

    The Proposal provides that it is up to the Member States to decide whether, in such related-party pre-packs, the acquirer must honour existing labour obligations. At first sight, this shift may appear trivial. A European rule protecting employees is abolished, but if Members States value the existing rule, they may still choose to implement national provisions to that effect. The Proposal, however, simply boils down to abolishing important European rules of employee protection. Moreover, the legislative strategy pursued by the European Commission is rather peculiar. While the Commission claims to be harmonising insolvency law, it is in fact de-harmonising European insolvency law with respect to employees’ rights in insolvency. The overall effect is a significant step backward in in the protection of employee rights in the context of business transfers across Europe. Employees of a company whose shareholder deploys a pre-pack strategy to reorganise and simply to continue operations through a new legal entity will end up with the same weak or non-existent protection as employees of a company that genuinely goes bankrupt and whose business ceases to exist. In other words, this Proposal for a European pre-pack undermines the protection of employees in cases of business transfers involving a pre-pack. In light of the European and global competition for insolvency cases, such fragmentation is regrettable and will diminish, rather than safeguard employees’ protection.

    Below we discuss the functioning of a pre-pack (§ 2), followed by a high-level analysis of the various interests at stake (§ 3). We then provide a more detailed examination of the current European legal framework and offer a robust interpretation of the case law of the Court of Justice of the European Union (§ 4). Next, we address the current Proposal for a European pre-pack in relation to employees’ rights (§ 5). In § 6, we conclude that under existing law, only in case of a pre-pack involving a genuine outside acquirer employees can be dismissed. In pre-packs involving former shareholders, employees simply transfer to the acquirer by operation of a sound European rule. This is a rule that should not be abolished. To state, as the European Commission does, that employees’ rights will not be prejudiced by the European pre-pack is to add insult to injury.

    2.
    The working and purpose of pre-packs and potential for opportunistic behavior

    A pre-pack is a pre-arranged sale of assets executed immediately upon the commencement of insolvency proceedings. A prospective buyer is identified in secret prior to the opening of the insolvency proceeding and once the court declares bankruptcy, the sale is executed. The company is declared insolvent and will be liquidated, while the business continues to operate under new ownership. A pre-pack thus compels stakeholders to make a sharp distinction between the company as a legal entity and the business that is being operated.

    The stated objective of pre-pack procedures is to maximise value for creditors while ensuring the continuation of operations. The more favourable interpretation of a pre-pack is that it can serve as an instrument for the benefit of creditors by selling the assets at a higher price than would be realised in normal unprepared insolvency proceedings. In a pre-pack, there will be less of a discount on the asset price since in standard liquidation proceedings buyers know that there is little time available to the trustee. Here the metaphor of a melting ice cube is often used to describe the predicament a court appointed trustee finds itself in. Amidst chaos, the trustee has to sell quickly and buyers will exploit this urgency.

    In the case of a pre-pack, creditors will remain unpaid to a certain and often to a very large extent. Although presented as a tool to protect creditors, creditors themselves are frequently highly suspicious of pre-packs. Concerns are particularly strong when former shareholders are the acquirers out of pre-packs. In England the situation developed to a point where two-thirds of pre-pack sales involved related-party pre-packs.[8] Similarly, in the Netherlands, in approximately 40% of cases the acquirers have been former shareholders or other related parties.[9]

    The pre-pack ‘playbook’ is full of tricks that allow former shareholders to guarantee that they will be the ones able to make the highest bid for the assets. A common strategy is to remove key assets, such as brands, IP-rights and real estate beforehand.[10] The trustee in bankruptcy is then left trying to sell a puzzle with several pieces are missing, since these are already in the hands of the shareholder seeking to acquire the assets at as the lowest possible price. Belgium seems to be exceptional in this respect, providing a positive example by introducing rules against such aggressive asset partitioning followed by attempt to profit from it.[11] Another strategy arises when the shareholder is also a creditor, or even a secured creditor. Instead of actually paying with new money for the assets, the shareholder can simply bid up to the amount of its secured claim. This practice, known as ‘credit bidding’, often scares off other potential bidders and is referred to as the chilling effect of a credit bid. In short, there are ample reasons to be suspicious of pre-packaged sales to former shareholders, not least because of their detrimental impact on creditors whose claims are typically wiped out. Whereas pre-packs involving external genuine external parties leave little room for opportunistic behaviour by shareholders, those involving former shareholders are rife with it.

    The European experience to date shows that creditors, court-appointed trustees, courts and legislators have thus far been unable to adequately protect creditors against the opportunistic use of pre-packs by former shareholders.

    3.
    Interests at stake and the balancing act

    Several interests are at stake in the process of establishing clear rules on the position of employees in the context of pre-packs and these interests can clash in various ways. The competing interests will be discussed against the background of the overarching question whether employees should transfer along with the business when the business is sold out of an insolvency procedure in which the former owner, as a company, is liquidated and ceases to exist.

    A first clash of interests arises between the interests of creditors and those of employees. If all employees were to transfer while retaining their existing terms and conditions of employment, regardless of their skills and performance record, this could significantly reduce the price a purchaser is willing to pay for the business. In such a case, employee protection may come at the expense of creditors. Since insolvency law is generally regarded as a body of law aimed at protecting creditors, imposing an obligation that all employees transfer along with the business would constitute a significant exception as to overall working of insolvency law.[12]

    If one wants to give more weight to employees’ protection, the question is how this should be achieved. It is clear that something has gone wrong with a company entering bankruptcy. An interested party may be willing to buy the company out of insolvency from the trustee in bankruptcy, but may decline to do so if the acquirer is required to take on all employees. The Court of Justice of the European Union faced this dilemma in the Abels-case. Various governments presented their views. The Danish government argued that the best protection for employees would be to require that all employees transfer along with the business, whereas the Dutch government argued that better protection was to allow the acquirer to ‘pick and choose’, believing that this approach would ultimately preserve more jobs than compelling the acquirer to take over all employees. In the Abels-case, the CJEU essentially left the issue unresolved and delegated the decision to the Member States. In a later amendment to the Transfer of Undertakings and Businesses Directive, this margin of discretion for Member States was explicitly introduced to the Directive, commonly referred to as ‘insolvency law exception’. Under the current Transfer of Undertakings and Businesses Directive, Member States may therefore provide that the transfer rules do not apply where a business is transferred out of insolvency proceedings, subject to certain conditions (see further below).

    Other interests are also at stake. In practice, the former shareholder may also have an interest in a pre-pack. Particularly given that in the UK the majority of pre-packs were conducted with the former shareholders,[13] it is clear that their position cannot be ignored. We do not, however, believe that the interests of former shareholders should be given any direct weight in relation to either creditors or employees. The basic rule of corporate finance, as well as of corporate and insolvency law, is that equity is wiped out first. Shareholders run the company at their own risk. This means shareholders stand to benefit the most through entitlement to profits, but are also the first to absorb losses. This reasoning provides the fundamental justification for shareholders’ rights to profit and control. Therefore, the interests of shareholders in case of insolvency are fundamentally subordinated to the interests of creditors. One could nevertheless argue that shareholders have succeeded in establishing a de facto position as stakeholders, and that such a position may even be considered desirable. One could reason that a shareholder should be permitted to make a bid for the company’s assets, thereby driving up the sale price which would be beneficial for creditors. The European proposal for a harmonised European pre-pack regime requires Member States to permit connected parties to acquire the business.[14] We are, however, sceptical about recognising shareholders as stakeholders in their own right. Even if one allows shareholders a seat at the table to increase the number of bidders, thereby potentially improving creditors’ outcomes indirectly, such participation should be approached with great caution and subject to strict safeguards. Examples of such safeguards include (i) requiring shareholders to place key assets such as brands, IP-rights and real estate on the table before being permitted to bid. (ii) prohibiting credit bids by shareholders and (iii) treating any outcome in which the former shareholder emerges as the best bidder as inherently suspect and less desirable than the enterprise being acquired by an entirely new owner. Additional checks and balances are also needed with respect to the closed bidding process that is intrinsic to pre-packs. Even as to outside, non-related bidders the closed nature of the process already raises concerns. In the United States this has led to the development of the ‘stalking horse’ procedure, under which new bidders are allowed to submit a higher bid after the initial closed bidding process with a break-up fee compensating the first bidder. The Proposal also seeks to allow for such mechanisms.[15] With respect to shareholders, further checks and balances are however needed, such as introducing a matching principle under which outside bidders may acquire the enterprise at the same price offered by the shareholder.[16]

    There is also the interest of the insolvency industry itself, which warrants critical examination. Not necessarily as a stakeholder, but as a group with significant influence over the legislative process. In the United Staes, the insolvency industry is regarded as the most significant actor in shaping insolvency laws. It is also considered to be far more effective in advancing its own interests than comparable groups in other areas of law.[17] It therefore seems prudent to ask whether the introduction of new rules, or even entirely new legal instruments, will also benefit the profession as a whole as well. In the case of a European pre-pack, this appears quite likely to be the case. More pre-packs mean more business for the insolvency industry. Introducing a European Pre-pack would significantly expand the scope of insolvency law. Particularly if, for some reason, the European Commission were to require Member States to allow related parties to acquire the business it would no longer be possible to determine whether alternative measures might also have helped to save the business at lower costs to creditors and employees, such as a simple infusion of new funds. If the Proposal for a European pre-pack will be adopted, pre-packs will simply become one of several business strategies. See critically as to this effect of pre-packs in general, Van Andel:

    “A bankruptcy procedure is not something which just happens to a party. Often bankruptcy is a deliberate choice: are we going to pay for a restructuring of the creditors and the employees, or should we put the company into bankruptcy and acquire the business and continue in a new legal entity?“[18]

    Allowing broad availability of pre-packs involving related parties also diminishes the disciplinary function of insolvency and weakens incentives against excessive indebtedness. Facilitating easy pre-packs with related parties, while simultaneously removing protections from employees, is more likely to benefit the insolvency industry than to promote a fair and resilient European economy.

    4.
    Current European legal framework

    The Transfer of Undertakings Directive protects employees against dismissal or the deterioration of their employment conditions when a business is transferred. Under Article 3 of the Transfer of Undertakings and Businesses Directive, employees will by reason of this transfer, automatically transfer to the acquirer with the preservation of all their terms and conditions of employment. However, Article 5 allows Member States to derogate from this rule in cases of formal insolvency proceedings, referred to as the insolvency law exception. If the exception applies, this means that notwithstanding the transfer of an operating business, the employees do not transfer along with it. The Netherlands has used this insolvency law exception in Article 7:666 of the Dutch Civil Code, thereby completely excluding the transfer rule in bankruptcies, other Member States such as Germany did not.

    For the insolvency law exception to apply, the insolvency proceedings in question must meet  three cumulative requirements: (i) they must be statutory insolvency proceedings, (ii) initiated with a view to the liquidation of the assets of the transferor, and (iii) subject to the control of a competent public authority.

    Case law from the CJEU has provided further guidance on the insolvency law exception and its three criteria. As to the requirement that the proceedings must be statutory, the CJEU has held that the pre-pack itself must also have a statutory basis. It is therefore not sufficient that the insolvency proceedings, once opened, are regulated by law. The preparatory pre-pack phase itself must likewise have a statutory foundation.[19]

    The much bigger question that was raised, was how to interpret the requirement that insolvency proceeding must have been instituted with a view to the liquidation of the transferor’s assets. What does this mean? Does not every liquidation proceeding result in the liquidation of the transferor’s assets? The key issue is what exactly needs to be liquidated. Although the CJEU itself also seems to have struggled with the application of the Transfer of Undertakings and Businesses Directive, the contours are now sufficiently clear.

    In the Smallsteps judgment of the CJEU (2017), Estro, a childcare chain, was sold through a pre-pack to Smallsteps, a buyer closely linked to the same shareholder.[20] The CJEU held that this pre-pack did not qualify for the insolvency exception in the Transfer of Undertakings and Businesses Directive, since it was not genuinely aimed at liquidation. In addition, the pre-pack itself also lacked a legal basis in the Member State concerned (the Netherlands). The result was that all employees should have automatically transferred to the acquirer Smallsteps under the rules of the Transfer of Undertakings and Businesses Directive.

    In the Heiploeg judgment of the CJEU (2022), the pre-pack concerned a sale to an external buyer.[21] Here the CJEU took a more accommodating approach to the pre-pack, ruling that preparatory steps alone do not disqualify a pre-pack from being regarded as aimed at liquidation. Provided that the pre-pack procedure has a legal basis in national law, in a situation such as that in Heiploeg, the insolvency exception in the Transfer of Undertakings and Businesses Directive may apply, meaning that the employees would not automatically transfer to acquirer.

    Many debates have followed on the correct understanding of these two separate cases, which may appear to be rather similar as to the facts but have a completely different outcome as to the application of the insolvency law exception. Legal scholars have argued that the questions posed to the CJEU were phrased radically different and that this might explain the difference in outcome. In Smallsteps the pre-pack was portrayed as the Evil Queen from Snow White, whereas in Heiploeg the pre-pack was presented as Snow White herself, according to such scholars.[22]

    Any unclarity as to the exact scope of the protection offered should of course not be constructed as to mean that it is unclear whether employees derive significant protection from the Transfer of Undertakings and Businesses Directive. Although one might argue that the exact boundary between a pre-pack to which the insolvency law exception does not apply and one to which it does apply is not entirely clear, it is evident that employees enjoy very significant protection against being dismissed in the context of a pre-pack at a European level from the Transfer of Undertakings and Businesses Directive. It should also be borne in mind that pre-packs are not, in essence, a tool to shed excess employees, but rather an instrument to maximise value for creditors. There may be many reasons to conduct a pre-pack without any intention of reducing the number of employees. At the same time, in Dutch practice, the Smallsteps ruling by the CJEU almost brought pre-packs to a complete standstill in the Netherlands. At present, the Netherlands faces more of a labour shortage than a surplus of employees. Nonetheless, it is clear that under the current European Rules workers enjoy strong protection. Although in the current economic climate companies do not face pressure to downsize as to their number of employees, this situation could change almost overnight, whether due to a sudden economic downturn or the disruptive impact of Artificial Intelligence. Should the economic tide turn, worker protection will once again become far more relevant and likely be one of the most important European political topics. The European rules are also needed for such times and should be drafted with such an outward economic tide in mind.

    Furthermore, the basic principles of the Transfer of Undertakings and Businesses Directive and its application to pre-packs are much clearer than is sometimes suggested. We believe that much more is at play here than merely the phrasing of the questions put to the CJEU or the way the Smallsteps and Heiploeg cases were presented to the CJEU. In short, we believe that the pre-pack in Smallsteps was in reality much more like the Evil Queen from Snow White, while the pre-pack in Heiploeg, as far as the pre-pack itself was concerned, was like Snow White herself.

    We return to the facts of the cases as presented by the CJEU itself. In Smallsteps the pre-pack was conducted indirectly with the old shareholder, whereas in Heiploeg the pre-pack was conducted with an outside (non-related) party.[23] We believe this not only explains the difference in outcome in the CJEU’s judgements, but also that this approach with a distinction according to the identity of the acquirer is the correct one, taking into account the background and rationale of protecting employees’ positions under the Transfer of Undertakings and Businesses Directive. Moreover, it offers a simple and very workable approach. Where the original capital provider remained the shareholder throughout, both before and after a pre-packaged insolvency procedure, the procedure cannot be said to have been aimed at liquidation.

    The CJEU uses different formulations when referring to the requirement that the proceedings must have been aimed at liquidation. The English-language version of the Transfer of Undertakings and Businesses Directive itself refers to proceedings ‘instituted with a view to the liquidation of the assets of the transferor’. The CJEU, however, uses different wording in its English-language judgements. In Smallsteps, the CJEU refers solely to the ‘liquidation of the assets of the transferor’.[24] In Heiploeg, the CJEU alternates between describing the liquidation requirement as ‘a liquidation of the assets’ and, on several occasions, as a ‘liquidation of the undertaking’.[25] In the original Dutch version of the case, the following terms are used: ‘liquidatie van het vermogen van de vervreemder’ , which translates as ‘liquidation of the patrimony of the transferor’ and, three times, ‘liquidatie van de onderneming’, which translates as ‘liquidation of the enterprise’.[26]

    There remains room for debate as to what exactly needs to be liquidated. It is evident that a pre-pack procedure results in the liquidation of the company as a legal entity owning the business. It is also clear that the assets are transferred to a new owner, the acquirer. It must equally be clear that something identifiable as an ‘undertaking’ or a ‘business’ must remain. If everything is sold off in fragments (as bits and pieces), there is no undertaking or business for the employees to accompany. So the liquidation must involve something more. We believe that the best formulation is found in the Dutch version of the judgement, which states that the enterprise should be liquidated.

    An enterprise is to be understood as a union of capital and labour. This is a common way of conceptualising what an enterprise is and is also reflected in Dutch Tax law.[27] Applied to pre-packs, this would mean that if the enterprise is genuinely broken up, so that the former shareholder as capital provider is no longer in place, employees as the element labour also does not need to remain in place. A consistent application of this principle would imply that when, after a prepack, the original capital provider remains in place, then so should the employees. Conversely, if the original capital provider does not remain in place, there are no compelling reasons to protect the employees, taking into account the background and rationale of protecting workers’ positions under the Transfer of Undertakings and Businesses Directive. This approach also aligns well with the reasoning of the CJEU in the Abels judgement.[28] In the case of pre-packs involving external (non-related) parties, it may be possible to preserve more jobs by allowing some employees to be dismissed. In the case of pre-packs involving related parties (the former shareholders), however, employees are left defenceless and thereby reduced to sitting ducks, and all labour law protections can easily be circumvented by orchestrating a pre-pack.

    5.
    The European proposal in stealth mode

    The Proposal for a European pre-pack seeks to completely eliminate any protection granted to employees under the Transfer of Undertakings and Businesses Directive in the case of a pre-pack, including one involving a related party. This is rather remarkable, given the reassuring language in the Preamble’s opening statement regarding the effects on employees.

    The proposal provides the following in recital 22a of the Preamble:

    “The pre-pack mechanism should be without prejudice to employees’ rights under Union and national law, including the involvement of employees’ representatives. Specifically, it should be governed by statutory or regulatory provisions and should be construed in a way where the transfer of all or part of an undertaking is prepared with the assistance of a monitor under the supervision of the court or competent authority, prior to the institution of formal insolvency proceedings that are instituted with a view to the liquidation of the assets of the debtor. While the primary aim of the pre-pack mechanism is to enable, in the interests of creditors, in the insolvency proceedings, a liquidation of the debtor’s assets by the transfer of all or part of the undertaking as a going concern which satisfies to the greatest extent possible the claims of all the creditors, it can also serve employment preservation.  

    Consequently, when it takes place in proceedings which could end in the liquidation of the debtor, the liquidation phase of the pre-pack mechanism in this Directive is an eligible procedure for the purposes of article 5(1) of Council Directive 2001/23/EC.”

    The actual abolishment of employees’ protection is set out in Article 20(2) of the draft Directive, which provides as follows:  

    For the purposes of Article 5(1) of Council Directive 2001/23/EC16, when it takes place in proceedings which can end in the liquidation of the debtor, the liquidation phase shall be considered to be bankruptcy proceedings or any analogous insolvency proceedings instituted with a view to the liquidation of the assets of the transferor under the supervision of a competent public authority.

    It is rather surprising that the preamble asserts that the pre-pack should be without prejudice to creditors’ rights and may also serve to preserve employment, and that, therefore, all pre-packs should qualify as being aimed at liquidation. In this way, the pre-pack mechanism does in fact remove labour protection in cases of transfers of undertakings involving a pre-pack, protection which has been recognised and affirmed by the CJEU. 

    Elsewhere, in recital 28e of the preamble of the Proposal for a European pre-pack – apparently a new clause compared to an earlier draft – Member States are given the option to introduce requirements obliging related-party acquirers to maintain existing employment contracts.

    “Where the offer made by a party closely related to the debtor is considered as the best offer, Member States should be able to introduce additional safeguards for the authorisation and execution of the sale of the debtor’s business or part thereof. Such safeguards can include, for example, the obligation for the acquirer to ensure business continuity for a minimum period of time, or the maintenance of pending employment contracts.”

    This may appear to be a minor shift, delegating legislative discretion from the EU level to the level of Member States. In reality, the shift is highly significant. Under current EU law, pre-packs involving the former shareholder do not permit the dismissal of employees. Under the envisaged EU law, such dismissals would be allowed, unless Member States decide to provide protection themselves. The European pre-pack would therefore dismantle long-established protection at the European level.

    One might be sympathetic to this approach of leaving difficult issues to Members States in areas where harmonisation proves unfeasible. In this field, however, a harmonised rule already exists and is now at risk of being abolished. Moreover, employees are the weaker party, while the position of capital providers is being strengthened.

    6.
    Conclusion

    The European Commission is seeking to harmonise the pre-pack at the European level. Although it begins by stating that the European pre-pack should not prejudice employees’ rights, in practice it does harm employees.

    At present, employees are protected by the Transfers of Undertakings and Business Directive. While it is possible to exclude the operation of these provisions in case of insolvency proceedings, this is only permitted if certain conditions are satisfied. The most important condition is that the insolvency proceedings must be aimed at liquidation. In cases brought before the CJEU, it has become clear that employees derive important protection from these rules in the context of pre-packs. Under existing European insolvency law, employees transfer along with the business in a pre-pack if the pre-pack is not aimed at liquidation. Although one might argue that the precise scope of the rules is not entirely clear, it is beyond doubt that employees currently enjoy very significant protection. The Commission’s assertion that the European pre-pack should not prejudice employees’ rights is therefore difficult to accept as genuine, and appears little more than a dubious attempt to divert attention from what the Commission is actually doing.

    In addition, we do not share the view held by some scholars that the basic rules are unclear. If one looks at the cases decided by the CJEU, the following principles regarding pre-packs can be derived:  

    • Where there is an external acquirer (i.e. not a related party), the insolvency exception applies and employees do not transfer automatically.
    • Where there is a related acquirer (a direct or indirect shareholder), the insolvency exception does not apply and all employees will, by reason of this transfer, automatically transfer to the acquirer with the preservation of all their terms and conditions of employment.

    The central notion here is that it should be assessed whether the enterprise is actually being liquidated. An enterprise is to be understood as a union of capital and labour. If the capital provider remains in place, the enterprise has not truly been liquidated and the employees should also remain in place. Only in case of a pre-pack involving an external acquirer, it can be held that the union between capital and labour has been broken up and can it be justified that the insolvency exception applies.

    Rolef de Weijs and Johan Zwemmer

    Prof. dr. R.J. de Weijs is professor of Insolvency Law at the University of Amsterdam and an attorney at a law firm in Amsterdam. Dr. J.P.H. Zwemmer is researcher at the University of Amsterdam and an attorney at a law firm In Amsterdam.

    [1] See Proposal for a Directive of the European Parliament and of the Council harmonising certain aspects of insolvency law, 23 May 2025, 2022/0408 (COD), (https://data.consilium.europa.eu/doc/document/ST-9257-2025-INIT/en/pdf) (hereafter ‘The Proposal’). The Proposal for a European pre-pack is part of a broader initiative to harmonise European insolvency law, which also includes proposed harmonisation of rules on directors’ liability and the duty to file, rules on avoidance of transactions, and rules on creditor committees.

    [2] See https://transactions.freshfields.com/post/102kswv/eu-insolvency-law-momentum-builds-as-european-parliament-comments-on-the-draft-d “Final adoption could occur by early 2026, depending on the pace of compromise.” See also https://bobwessels.nl/blog/2025-04-doc1-the-european-pre-pack-is-slowly-being-unpacked/.

    [3] Proposal, preamble, nr. 22a.

    [4] Council Directive 2001/23/EC of 12 March 2001 on the Approximation of the Laws of the Member States Relating to the Safeguarding of Employees’ Rights in the Event of Transfers of Undertakings, Businesses or parts of Undertakings or Businesses.

    [5] The English version refers to ‘instituted with a view to the liquidation of the assets of the transferor’. The Dutch version refers to ‘procedure met het oog op de liquidatie van het vermogen van de vervreemder’, the French version to ‘d’une procédure d’insolvabilité analogue ouverte en vue de la liquidation des biens du cédant’, the Spanish version to ‘procedimiento de insolvencia análogo abierto con vistas a la liquidación de los bienes del cedente’ and the German version refers to ‘mit dem Ziel der Auflösung des Vermögens des Veräußerer’.

    [6] See for a different perspective, Bob Wessels (https://bobwessels.nl/blog/2025-04-doc1-the-european-pre-pack-is-slowly-being-unpacked/), who writes the following: “In doing so, the proposed directive codifies case law of the Court of Justice of the EU, so that there should be no doubt that the ‘bankruptcy exception’ of Directive 2001/23 applies to this procedure.” We believe that a more accurate description is that the Proposal renders all existing case law and the protection offered thereby to employees obsolete.

    [7] See article 20-2 Proposal: “For the purposes of Article 5(1) of Council Directive 2001/23/EC16, when it takes place in proceedings which can end in the liquidation of the debtor, the liquidation phase shall be considered to be bankruptcy proceedings or any analogous insolvency proceedings instituted with a view to the liquidation of the assets of the transferor under the supervision of a competent public authority.”

    [8] T. Graham, Graham Review into Pre-pack Administration, June 2014, page 37.

    [9] See J.R. Hurenkamp, ‘Failliet of fast forward? Een analyse van de pre-pack in de praktijk’, TvI 2015/20. In the Nederlands in the period 2012-2014 in 15 out of 39 pre-packs, the sale was to a related party.

    [10] In the bankruptcy of Mexx (clothing company) it emerged that the shareholder held a right of pledge over the IP rights (See first Public Report Mexx Europe BV, 22 February 2015, no. 5.4). See also the dispute between the trustees in the bankrupty of D-reizen (travel agency) and the founder, who was also a former director of D-reizen, where the IP-rights were placed in a bankruptcy-remote entity and, in addition, pledged to the shareholder (See Court of Noord-Holland, 28 May 2021, ECLI:NL:RBNHO:2021:4344(Tekstra q.q. en Willemse q.q./Selten). Also see the second bankruptcy of Scotch & Soda, where the trustees did not have control over the brand Scotch & Soda (https://www.bnr.nl/nieuws/economie/10550458/koopjesjagers-hoeven-niet-te-rekenen-op-goedkope-deals-na-faillissement-scotch-soda).

    [11] The Belgian legislator has recognised this risk. Belgian law provides that a shareholder may only make a bid if it also makes available for sale any assets it controls, so that an outsider can acquire the entire business. See J. Vananroye, A. Van Hoe and G. Lindeman, Curb Your Opportunism: Limits to Group Structures and Asset Partitioning in Insolvency in Belgium, NACIIL Annual Report 2018, available at https://nvrii.nl/wp-content/uploads/2021/07/preadviezen-2018.pdf. In order to counterbalance strategic advantage of insiders, Article XX.87, § 2 (translation taken from J. Vananroye, A. Van Hoe and G. Lindeman) contains the following rule: In case a bid is made by persons who control the undertaking (or controlled it during six months prior to the initiation of the judicial reorganization) and who either directly or indirectly control any rights which are necessary to continue the activities, the offer can only be taken into account if such rights are made accessible to other bidders under the same terms and conditions. (Original Dutch version): Ingeval een offerte uitgaat van personen die controle op de onderneming uitoefenen of hebben uitgeoefend gedurende zes maanden voorafgaand aan de opening van de procedure, en die rechtstreeks of onrechtstreeks de controle hebben over rechten die noodzakelijk zijn voor de voortzetting van haar activiteiten, kan die offerte slechts in aanmerking worden genomen op voorwaarde dat die rechten onder dezelfde voorwaarden toegankelijk zijn voor de andere bieders.”

    [12] At the same time, one can and should question the basic model of creditor wealth maximisation as the sole purpose of insolvency law, just as one can and should question the model of corporate law that treats shareholder value maximisation as its only objective.

    [13] T. Graham, Graham Review into Pre-pack Administration June 2014, page 37.

    [14] See Article 32: Parties closely related to the debtor in the sale process:

    1. Member States shall ensure that parties closely related to the debtor are eligible to acquire the debtor’s business or part thereof, provided that all of the following conditions are met: (a) the parties closely related to the debtor they disclose in the bid in a timely manner to the monitor and to the court their relation to the debtor; (b) other parties other than those referred in point (a) to the sale process receive adequate information on the existence of parties closely related to the debtor and their relation to the latter;. (ba) in the case under article 26(1), point (a), a valuation of the business as a going concern is carried out for the purposes of the statement of the monitor referred to in Article 22a(2), point (c). (d) parties not closely related to the debtor are granted sufficient time to make an offer. Member States may provide that, where it is proven that a party closely related to the debtor failed to comply with the conditions the disclosure duty referred to under the first subparagraph, point (a), was breached, the court or competent authority revokes the benefits referred to in Article 28(1). 2. Where the offer made by a party closely related to the debtor is the only considered as the best existing offer, Member States may introduce additional safeguards for the authorisation and execution of the sale of the debtor’s business or part thereof.”

    [15] See Preamble, nr. 27: If a Member State opts to require that a public auction is run prior to or after the opening of the liquidation phase, the offer selected by the monitor during the preparation phase should be used as an initial bid (‘stalking horse bid’) for the purposes of the auction (…).

    [16] Here we focus on employee rights and how employee protection is abolished at a European level. There are many more concerns which should be addressed adequately if the European Union wants to introduce at a European level pre-packs with related parties.

    [17] See David A. Skeel, ‘Bankruptcy Lawyers and the Shape of American Bankruptcy Law’, https://ir.lawnet.fordham.edu/cgi/viewcontent.cgi?article=3511&context=flr, 1998, page 521 and 522: “bankruptcy lawyers exert significant influence over the shape of the bankruptcy process, and they have a strong incentive to maximize the use of bankruptcy. (…) Bankruptcy lawyers are only one of many groups that have a large stake in the contours of bankruptcy law. But no other group has had nearly so far-reaching an influence as bankruptcy lawyers (…).” And Adler, Polak & Schwartz, ‘Regulating Consumer Bankruptcy: A Theoretical Inquiry’, https://depot.som.yale.edu/icf/papers/fileuploads/2425/original/99-99.pdf%5D October 1999: “The current business and consumer bankruptcy systems thus substantially benefit: the bankruptcy bar, the bankruptcy judges, and the academics whose consulting income increases with the cost, complexity, and court centeredness of the system. These groups have dominated the current reform debate and past debates as well. Informal speculation plausibly suggests that we have the consumer bankruptcy system that the lawyers want. ”

    [18] See W.J. van Andel, ‘Stop de pre-pack’, TvI 2014/37. In the original Dutch language: “Een faillissement is niet iets wat een partij alleen maar overkomt. Vaak is het ook een bewuste keuze: gaan we nog betalen voor een sanering van het werknemers- en crediteurenbestand of kunnen we de vennootschap beter laten failleren en dan doorstarten met een nieuw opgerichte vennootschap?” and in English, this comes down to: ‘Bankruptcy is not merely something that happens to a party. Often, it is also a conscious choice: do we continue to pay for a restructuring of the workforce and creditors, or is it better to let the company go bankrupt and then make a fresh start with a newly established entity?’

    [19] CJEU, 22 June 2017, Case C-126/16 (Smallsteps).

    [20] CJEU, 22 June 2017, Case C-126/16 (Smallsteps), nr, 20.

    [21] CJEU, 28 April 2022, Case C-237/20 (Heiploeg), nr. 26.

    [22] See F.M.J. Verstijlen in his case note to CJEU 28 April 2022, NJ 2022/272 (Heiploeg).

    [23] For Smallsteps see CJEU, 22 June 2017, Case C-126/16 (Smallsteps), nr, 20, where the CJEU describes the underlying facts as follows: “During the implementation of Project Butterfly, Estro Groep contacted only H. I. G. Capital — a sister company of its principal shareholder, Bayside Capital — as a potential buyer. No other potential option was explored.” And for Heiploeg see CJEU, 28 April 2022, Case C-237/20 (Heiploeg), nr. 26 where the CJEU describes the underlying facts as follows: ‘In view of the serious financial difficulties faced by Heiploeg-former, no bank agreed to finance the payment of that fine. Thus, as soon as the fine was imposed, the possibility of using a pre-pack was examined. To that end, several independent companies in relation to the Heiploeg group were invited to submit an offer for the assets of Heiploeg-former.’

    [24] Judgment of the Court (Third Chamber) of 22 June 2017, Case C-126/16 (Federatie Nederlandse Vakvereniging and Others v Smallsteps BV).

    [25] See CJEU Heiploeg, nr. 53, where the courts reasons: “It is necessary in that respect to verify, in each situation, whether the pre-pack procedure and the insolvency proceedings at issue were carried out with a view to the liquidation of the undertaking as a result of the established insolvency of the transferor and not with a view to the mere reorganisation of that undertaking.” And again in a similar way in nr. 53 and 67.

    [26] See CJEU Heiploeg, nr. 53, where the courts reasons in full: “In dit verband dient in elke afzonderlijke situatie te worden nagegaan of de betrokken pre-packprocedure en faillissementsprocedure gericht zijn op de liquidatie van de onderneming nadat is vast komen te staan dat de vervreemder insolvent is, en niet enkel op een reorganisatie van die onderneming.” And again in a similar way in nr 53 and 67.

    [27] More specifically, for Dutch Corporate Income Tax purposes, it is required that there is an enterprise, which entails a lasting organisational union of capital and labour. In full (translation by authors): “An enterprise is deemed to exist if 1) through a durable organisation of capital and labour 2) participation occurs in economic transactions 3) with the intention of generating a profit, which profit may also be reasonably expected.” See Amendment of the Dutch Corporate Income Tax Act 1969 and certain other laws in connection with the modernisation of the corporate income tax obligation for public enterprises (Wet modernisering Vpb-plicht overheidsondernemingen). See https://zoek.officielebekendmakingen.nl/kst-34003-3.pdf.

    [28] This approach also aligns well with the Directive itself and with the CJEU judgement of 25 July 1991, d’Urso and Others, C‑362/89. The Transfer of Undertakings Directive protects employees when the ‘entrepreneurial head’ is replaced. It is quite clear that, in the case of a pre-pack involving the former shareholder, this entrepreneurial head does not even change.

    Financial Mindmap: videos explaining corporate finance

    In 2024, the paperback version of “Corporate Finance for Lawyers” was published. In this book, the authors explore the intricate relation between law and corporate finance to allow lawyers to gain a deeper understanding of the field they are working in.

    First of all, the book provides an introduction into the basic building blocks of the world of corporate finance and the dominant company valuation methods of EBITDA-multiples and Discounted Cash flow methods. The book further explains standard finance patterns from both a finance and a legal perspective, most notably the increased use of non-interest bearing debt as cheap way of finance, financing by means of secured credit, financing by means of shareholder loans and financing by means of guarantees. The book also discusses the corporate finance dynamics of reorganization procedures and disputes over the allocation of value as part thereof. The authors focus on what goes on in the actual world of corporate finance, discussing the power balance between shareholders, secured lenders and creditors in a world where the assumptions of perfectly functioning markets with fully adjusting creditors do not apply.

    The authors use the Financial Mindmap throughout the book. This tool depicts finance by using colour and visualisations in a clear and intuitive manner. By using the Financial Mindmap, readers can quickly gain an intuitive understanding of finance.

    The Financial Mindmap is developed as an interactive tool for teaching purposes. In order to bring the Financial Mindmap further to live, the authors have developed video’s explaining corporate finance. In addition to an Introduction to Corporate Finance for Lawyers, the authors discuss Solvency and insolvency as balance sheet concepts (video 1), The use of non-interest bearing debt as a cheap source of finance (video 2), Non-interest bearing debt and company valuation (video 3), and Secured credit for investing and distributions to shareholders (video 4).

    Wanneer privébedrijven raken aan het algemeen belang: lessen trekken uit de British Steel-saga

    Crisis bij British Steel – een blog door gastblogger Noor Mendonck (UGent)

    Afgelopen weekend kwam British Steel (de Britse staalgigant) herhaaldelijk in het nieuws, omdat het bedrijf in ernstige moeilijkheden verkeert. De Chinese Jingye Group, die het vijf jaar geleden nog van een faillissement redde via een overname, besloot de hoogovens in Scunthorpe (in het noorden van het VK) te sluiten vanwege de enorme financiële verliezen die ze veroorzaken. Die sluiting zou volgens Businss Secretary Jonathan Reynolds echter extreem duur én gevaarlijk zijn, wat ertoe leidde dat het Britse parlement zich op zaterdag 12 april genoodzaakt zag om uitzonderlijk samen te komen en noodwetgeving goed te keuren. Het is pas de zesde keer sinds de Tweede Wereldoorlog dat het parlement in het weekend bijeenkomt, een duidelijke indicatie van het belang dat ze aan deze zaak hechten.[1]

    Binnen een termijn van één dag werd de Steel Industry (Special Measures) Act 2025 van kracht: een korte, doelgerichte wet, speciaal opgesteld om de situatie in Scunthorpe het hoofd te bieden. De wet voorziet nog niet in een nationalisering van het bedrijf, maar geeft de bevoegde minister wel verregaande bevoegdheden. Zo kan de minister formele en bindende instructies geven over het beheer van het bedrijf. Als die instructies niet worden gevolgd, mag de overheid rechtstreeks zelf ingrijpen om het in stand houden van de hoogovens te verzekeren. Opmerkelijk is dat de wet dit enkel toestaat wanneer het algemeen belang in het gedrag komt. Daarmee geeft de overheid impliciet te kennen dat zij de situatie in Scunthorpe beschouwd als rakend aan het algemeen belang (artikel 2-3 Steel Industry (Special Measures) Act 2025).

    Aangezien Jingye in theorie nog steeds het bedrijf leidt, bepaalt de nieuwe wet ook dat iedereen die werknemers tegenhoudt bij het uitvoeren van de instructies van de minister, daarmee een overtreding begaat. Daarnaast voorziet de wet in een compensatieregeling: werknemers die door Jingye worden ontslagen, kunnen toch worden uitbetaald. Jonathan Reynolds heeft bovendien niet uitgesloten dat een nationalisering op termijn een reële optie blijft.

    Verklaring van het hevige overheidsingrijpen

    Continue reading “Wanneer privébedrijven raken aan het algemeen belang: lessen trekken uit de British Steel-saga”

    Ongeorganiseerde gedachten over het zgn. organisatie-vereiste n.a.v. HvJ 14 november 2024 (Agenciart)

    Een betekenis voor het Belgisch insolventierecht?

    De Richtijn Betalingsachterstand Handelstransacties (Richtlijn 2011/7/EU) is van toepassing op “transacties tussen ondernemingen of tussen ondernemingen en overheidsinstanties die leiden tot het leveren van goederen of het verrichten van diensten tegen vergoeding”. Onderneming wordt daarbij gedefinieerd als :

    “elke organisatie, met uitsluiting van overheidsinstanties, die handelt in het kader van haar zelfstandige economische of beroepsmatige activiteit, ook wanneer deze activiteit door slechts één persoon wordt uitgeoefend” (art. 2, punt 3)

    In een arrest van 14 november 2024 (ECLI:EU:C:2024:959) antwoordt het Hof van Justitie op een prejuciciële vraag van een Portugese rechter of een natuurlijke persoon die gewoonlijk als zelfstandige tegen vergoeding het beroep van actrice uitoefent, maar die niet beschikt over een eigen bedrijfsruimte, personeel, gereedschap of uitrusting die verband houden met haar beroepsactiviteit, onder dat begrip „onderneming” valt.

    Het Hof beantwoordt dit positief: een natuurlijke persoon die gewoonlijk als zelfstandige tegen vergoeding het beroep van actrice uitoefent, maar die niet beschikt over een eigen bedrijfsruimte, personeel, gereedschap of uitrusting die verband houden met haar beroepsactiviteit, valt onder het begrip „onderneming” in de zin van de Richtlijn Betalingsachterstand Handelstransacties.

    Bij een natuurlijke persoon voegt is er geen organisatievereiste die bij de natuurlijke persoon iets toevoegt aan het vereiste dat de transactie kadert in een zelfstandige beroepsmatige activiteit. Rechtsoverweging 29: “Dit vereiste impliceert dat die persoon die activiteit gestructureerd en duurzaam uitoefent, zodat het bij die activiteit niet slechts dient te gaan om één geïsoleerde verrichting, en dat de betrokken transactie wordt gesloten in het kader van die activiteit (zie in die zin arrest van 15 december 2016, Nemec, C‑256/15, EU:C:2016:954, punt 34).”

    * * *

    Artikel 2, 2 van de Belgische Wet Betalingsachterstand Handelstracties neemt de definitie uit de richtlijn over. Het arrest Agenciart zal daar weinig veranderen. Een organisatievereiste zoals gesuggereerd door de verwijzende rechter is bij mijn weten in België nooit voorgesteld.

    * * *

    Waar het arrest wel olie op een reeds laaiend brandende afvalcontainer zal gooien is bij de interpretatie van het toepassingsgebied van het formele ondernemingsbegrip van art. I.1,1° WER.

    Continue reading “Ongeorganiseerde gedachten over het zgn. organisatie-vereiste n.a.v. HvJ 14 november 2024 (Agenciart)”

    Er staat nog steeds een fout(je) in boek XX WER

    Mr. Vincent Verlaeckt over het provisioneel ereloon van de curator

    Enige tijd geleden heb ik op deze blog – in verschillende etappes – bericht over enkele foutjes in boek XX.WER.  Er werd op verschillende plaatsen in boek XX verwezen naar verkeerde wetsartikelen.

    Dit heeft o.a. geleid tot wijziging van artikel XX.106 WER bij “Wet om justitie menselijker, sneller en straffer te maken“ van 28 november 2021 en tot wijziging van artikel XX.229 WER bij “Wet tot omzetting van Richtlijn 2019/1023” van 7 juni 2023.

    Bij het avondlijk doorbladeren van boek XX.WER is mijn oog thans gevallen op art. XX.20 § 5 WER.

    Op basis van artikel XX.20 § 5 WER kan een curator tussentijds verzoeken een provisioneel ereloon toe te kennen in afwachting van de sluiting van het faillissement.

    Continue reading “Er staat nog steeds een fout(je) in boek XX WER”

    Algemene verkorting Duitse kwijtscheldingstermijn naar 3 jaar: positief geëvalueerd voor consumenten

    Een post door gastblogger Gauthier Vandenbossche (UGent)

    De Duitse wet van 22 december 2020 tot verkorting van de kwijtscheldingstermijn, die op 1 oktober 2020 in werking is getreden, heeft de reguliere duur van de procedure tot kwijtschelding van restschulden voor alle natuurlijke personen verkort van zes naar drie jaar. Er werd voorzien dat de Bundesregierung  midden 2024 een verslag moest uitbrengen aan de Bundestag over de vraag hoe dit het verzoek-, betalings- en economische gedrag van consumenten heeft beïnvloed. In dit verslag wordt besloten dat er geen bewijs is dat de verkorting een impact heeft op het gedrag van consumenten. Dat is een interessante vaststelling voor de Belgische insolventiewetgever.

    In deze blogpost sta ik stil bij de wet van 22 december 2020. Eerst geef ik toelichting bij de Duitse schuldkwijtscheldingsprocedure en de laatste wijziging ervan. Bijzondere aandacht is er voor het gelijktrekken van de kwijtscheldingstermijn voor ondernemers en consumenten. Hiervan is midden 2024 een evaluatie gemaakt, die zal worden toegelicht. Nadien worden nog kort de hoofdlijnen van de insolventieprocedure voor consumenten weergegeven. Besluiten doe ik met enkele korte overwegingen die de Belgische insolventiewetgever kan meenemen uit dit alles.

    Continue reading “Algemene verkorting Duitse kwijtscheldingstermijn naar 3 jaar: positief geëvalueerd voor consumenten”

    Reorganisatieschulden en het pand handelsfonds: vele varkens maken de spoeling dan toch niet altijd dun

    Gastblogger mr. Jente Dengler over Bergen 1 februari 2021, 2018/RG/15 en Cass. 10 juni 2022, C.21.0377.F

    Op 10 juni 2022 moest het Hof van Cassatie zich andermaal buigen over een zaak waarin de toepassing van art. XX.58 WER (oud art. 37 WCO) centraal stond.[1] Ter herinnering, deze wetsbepaling voorziet dat schuldvorderingen voor prestaties verricht tijdens een reorganisatieprocedure worden beschouwd als ‘boedelschulden’ in een navolgend faillissement en zelfs bij voorrang moeten worden betaald met de opbrengst van activa, indien deze prestaties hebben bijgedragen tot het behoud ervan, niettegenstaande eventuele preferente aanspraken van zekerheidsschuldeisers (vandaar de toepasselijke benaming: ‘supervoorrang‘).

    De concrete casus betrof een slachthuis dat in februari 2014 werd toegelaten tot een gerechtelijke reorganisatie middels collectief akkoord (beter bekend als de ‘GRP 2’), vervolgens noodgedwongen overschakelde naar een procedure tot overdracht onder gerechtelijk gezag (oftewel, een ‘GRP 3’), maar uiteindelijk het faillissement niet kon afwenden en in maart 2015 de boeken neerlegde. Tijdens haar vergeefse reorganisatiepogingen kon het bedrijf niettemin blijven rekenen op haar belangrijkste, en bovenal zeer loyale, slachtveeleveranciers.

    Na faillissement claimde één van deze leveranciers dat de door hem geleverde varkens hadden bijgedragen tot het behoud van het handelsfonds van het slachthuis en beriep zich op art. XX.58, in fine WER om bij (super)voorrang aanspraak te maken op de verkoopopbrengst ervan.

    De huisbankier van het slachthuis, tevens begunstigde van een pandrecht op het handelsfonds, was hier evident niet mee opgezet. Om een uitholling van haar onderpand te vermijden, betoogde de bank dat het handelsfonds tijdens de reorganisatieprocedure(s) alleen maar in waarde was gedaald en er bijgevolg van een “bijdrage tot behoud” in de zin van art. XX.58 in fine WER geen sprake kon zijn.

    Achtergrond

    Van oudsher worstelen de Belgische hoven en rechtbanken met de concrete toepassing van art. XX.58 in fine WER op universaliteiten, zoals bv. een handelsfonds.[2] De samenstelling van zulk ‘vlottend’ onderpand (in het Engels: floating charge) verandert immers voortdurend. Voorraden nemen af naarmate er bestellingen worden uitgeleverd, klantenvorderingen komen in de plaats, nieuwe schulden worden aangegaan voor het wederom aanleggen van voorraden, enz. Door dit veranderlijk karakter is het niet vanzelfsprekend om ex post na te gaan of bepaalde prestaties verricht vóór faillissement hebben bijgedragen tot het “behoud” van dit onderpand.

    In haar princiepsarrest van 28 februari 2014 (‘Fortemps’) stelde het Hof van Cassatie zich aanvankelijk nog soepel op ten aanzien van een leverancier van verpakkingsmateriaal voor tuinmeubilair.[3] Volgens het Hof hadden diens leveringen toegelaten dat de (later gefailleerde) tuinmeubelwinkel tijdens haar reorganisatie nog meubels kon verkopen en als gevolg hiervan het handelsfonds intact bleef. Niet geheel verrassend, lazen de lagere rechtbanken en doctrine in deze cassatierechtspraak een ruime invulling van het supervoorrangsrecht.[4]

    In het Alfacam-arrest van 22 februari 2018 nuanceerde het Hof echter haar eigen rechtspraak en oordeelde dat het louter bijdragen tot de verderzetting van de activiteit door de schuldenaar, met alle risico’s van dien, niet automatisch tot gevolg heeft dat de economische waarde van de handelszaak behouden blijft, maar dat het aan de leverancier is om zijn bijdrage tot dit behoud in concreto aan te tonen.[5]

    Beoordeling

    Op de hamvraag (pun intended)of de varkensleveringen in casu hadden bijgedragen tot het behoud van de economische waarde van het handelsfonds van het slachthuis, antwoordde het Hof van Beroep te Bergen ontkennend bij gebrek aan concreet bewijs.[6] Veel verder dan dat zijn leveringen de verderzetting van de slachthuisactiviteit mogelijk hadden gemaakt, ging het betoog van de varkensleverancier immers niet.

    (side note: de aanscherping in Alfacam volgde kort na het eerste vonnis dat de leverancier wél nog gelijk gaf en hem de supervoorrang toekende in navolging van Fortemps)

    Dat de leverancier ook nadien in cassatie bot ving, lijkt te bevestigen dat het Hof definitief haar eerder soepele opstelling in de Fortemps-zaak heeft verlaten voor de strengere benadering in Alfacam. In het licht van de paritas creditorum-regel en met het oog op de bescherming van klassieke zekerheidsfiguren tegen een al te verregaande uitholling, is een zekere terughoudendheid bij de toekenning van de supervoorrang van art. XX.58 WER  ongetwijfeld toe te juichen – al had de praktijk ook wel gebaat geweest bij een precisering, minstens enkele richtsnoeren[7], over wat deze concrete bewijslast juist inhoudt. Een gemiste kans?

    Prima facie lijkt het besproken arrest dus weinig tot geen nieuwe inzichten op te leveren.

    De aandachtige lezer merkt echter op dat het Hof niettemin van de gelegenheid gebruik maakte om – zonder weliswaar het arrest zelf te vernietigen – de zin en vooral de onzin van bepaalde argumenten opgeworpen in de beroepsprocedure op de korrel te nemen.

    Zo argumenteerde de curator van het failliete slachthuis onder meer dat van enige bijdrage aan het behoud van het handelsfonds geen sprake kon zijn, omdat de varkensleveringen niet “onmisbaar” waren voor de handelsactiviteit en de gefailleerde op eender welk moment op een andere leverancier beroep had kunnen doen. Terecht oordeelde het Hof dat de aanwezigheid van alternatieve leveranciers niet ter zake doet (of, anders gezegd, een leverancier moet in geen geval monopolist zijn om zich succesvol op art.XX.58 in fine WER te kunnen beroepen). Overigens, ook in het licht van de bijdrageplicht die onverkort geldt voor separatisten wat boedelschulden van hun subboedel betreft (vgl. art. 20,4° Hyp.W.)[8], is dit betoog van de curator volstrekt impertinent.

    Daarnaast bleek het gegeven dat het handelsfonds tijdens de gerechtelijke reorganisatie in waarde zou zijn verminderd, eveneens an sich onvoldoende om een beroep op art. XX.58 in fine WER per definitie uit te sluiten. Nochtans een vaak gehoord argument contra de supervoorrang is dat er van enig “behoud” van het handelsfonds enkel sprake zou kunnen zijn, als de waarde ervan gedurende de reorganisatieprocedure minstens behouden is gebleven.[9] De achterliggende idee is dat moet worden vermeden dat eender welke verlieslatende onderneming zomaar kan worden voortgezet in reorganisatie met tal van (super)bevoorrechte reorganisatieschulden tot gevolg, waarvan de rekening vervolgens gepresenteerd wordt aan de pandhouder op handelsfonds (die hun onderpand uitgehold zien). [10]  

    Deze vergelijking in de tijd (vgl. waarde van het handelsfonds bij aanvang van reorganisatie versus op datum van faillissement) lijkt echter nogal kort door de bocht:

    Ten eerste kent ons Belgisch insolventierecht een ‘open portaal’-benadering, wat wil zeggen dat het gamma aan reorganisatieprocedures openstaat voor (quasi) [11] alle ondernemingen, ook voor verlieslatende, met alle mogelijke gevolgen voor het handelsfonds van dien. De aanvrager- schuldenaar zal in zijn reorganisatieaanvraag moeten toelichten “welke maatregelen hij overweegt om de rendabiliteit van zijn onderneming te herstellen”.[12] De Belgische wetgever gaat er dus schijnbaar zelf vanuit dat de activiteiten van de aanvrager niet zelden verlieslatend zullen zijn.

    Ten tweede zal een zekerheidsschuldeiser van zodra het reorganisatieverzoek door de schuldenaar is ingediend, zijn onderpand in principe niet meer kunnen verzilveren (moratorium).[13] De pandhouder zal dus hoe dan ook de gevolgen van de verderzetting van de onderneming door de schuldenaar en de eventuele waardevermindering van het handelsfonds moeten ondergaan, ook zonder dat er per se sprake moet zijn van oplopende reorganisatieschulden (bv. door het verlies van belangrijke handelscontracten).[14]

    Kortom, dat de pandhouder op handelsfonds mogelijks de rekening van de (mislukte) reorganisatie gepresenteerd krijgt, valt geenszins de loyale leveranciers van de schuldenaar te verwijten. Deze risicoverschuiving is niets meer dan een inherent gevolg van het debtor-friendly reorganisatiebeleid waarvoor de Belgische wetgever destijds heeft gekozen.[15] Had de Belgische wetgever het anders gewild, dan zou hij verlieslatende ondernemingen in eerste instantie al niet toelaten tot de gerechtelijke reorganisatie, laat staan een moratorium voorzien dat deze zekerheidsschuldeiser tijdelijk zijn executierechten ontneemt.[16]

    Een zinvollere vergelijking bestaat er volgens de auteur dan ook in te kijken naar de reële waarde van het handelsfonds op het moment van faillissement vs. haar hypothetische waarde in de veronderstelling dat de betrokken leveringen niet hadden plaatsgevonden. Is deze hypothetische waarde gelijk of hoger, dan hebben de betrokken prestaties geen wezenlijk verschil gemaakt. Is de hypothetische waarde daarentegen lager, dan hebben de leveringen onmiskenbaar bijgedragen tot het behoud van het handelsfonds, zelfs bij een verlieslatende voortzetting (desgevallend hebben ze minstens de schade beperkt en dus in elk geval de pandhouder tot voordeel gestrekt).

    In dezelfde zin oordeelde het Hof van Cassatie in haar arrest van 10 juni 2022 dat de weigering van het supervoorrangsrecht niet was ingegeven door de waardevermindering van het handelsfonds gedurende de reorganisatie, maar wél volgde uit de vaststelling dat in het alternatieve scenario dat er geen varkens waren geleverd, het handelsfonds niet minder waard zou zijn geweest op datum van faillissement.

    Conclusie: geen baanbrekend arrest, maar wel een consequente handhaving door het Hof van haar eerdere rechtspraak met hier en daar een nuance over wat wel en vooral niet ter zake doet in de voorrangsdiscussie van art. XX.58 in fine WER.

    Deze blogpost is een verkorte weergave van “Reorganisatieschulden en het pand handelsfonds: Vele varkens maken de spoeling dan toch niet altijd dun” (TIBR 2024, afl. 2, p. 7-14), dat hier te raadplegen is, over de delicate evenwichtsoefening tussen de belangen van reorganiserende schuldenaars, loyale leveranciers en bevoorrechte schuldeisers in het kader van de toepassing van art. XX.58 WER en de conflicterende voorrangsrechten op een verpand handelsfonds.

     Jente Dengler
    Advocaat Monard Law
    Vrijwillig medewerker KU Leuven
    Instituut voor Handels- en Insolventierecht

    [1] Cass. 10 juni 2022, TIBR 2023, afl. 2, RS-33-35.

    [2] Vgl. voorrecht voor het behoud van de zaak (artikel 20, 4° Hyp.W.) dat enkel van toepassing is op specifieke goederen.

    [3] Cass. 28 februari 2014, Arr.Cass. 2014, afl. 2, 563.

    [4] Kh. Brussel (Nl.) nr. K/12/02682, 3 april 2014, DAOR 2015, afl. 113, 96 (m.b.t. onbetaalde RSZ-bijdragen voor tewerkstelling personeel); Kh. Gent (afd. Oudenaarde) 14 april 2016, A/2013/0968, onuitg. (m.b.t. levering van elektriciteit);

    [5] Cass. 22 februari 2018, RW 2018-19, afl. 23, 899.

    [6] Bergen 1 februari 2021, 2018/RG/15.

    [7] Voor een interessante illustratie, zie Antwerpen 21 juni 2018, RW 2018-19, afl. 23, 906.

    [8] E. DIRIX en R. DE CORTE, Zekerheidsrechten, Mechelen, Kluwer, 2006, 54; A. DE WILDE, Boedelschulden in het insolventierecht, Antwerpen, Intersentia, 2005, 558.

    [9] Dit argument werd o.a. ook opgeworpen in Gent 22 mei 2017, 2015/AR/3137, TRV-RPS 2018, afl. 7, 759.  Zie ook C. VAN DEN BROECK, “De voorrang van reorganisatieschulden in een navolgend faillissement”, TRV-RPS 2018, afl. 7, 705.

    [10] Zie ook S. BRIJS en A. VAN HOE, “De gerechtelijke reorganisatie door overdracht onder gerechtelijk gezag: conceptuele en juridische knelpunten”, TBH 2012, (319) 417.

    [11] Nuance: indien de schuldenaar kennelijk niet meer in staat is de continuïteit van zijn activiteiten te verzekeren, kan de voortijdige beëindiging van de gerechtelijke reorganisatie worden gevraagd (art. XX.62 WER).

    [12] Art. XX.41, §2, 8° WER

    [13] Art. XX.50 en XX.52 WER. Een uitzondering is terug te vinden in art. XX.59/1 WER dat evenwel niet lijkt te zijn ingegeven ter bescherming van de pandhouder op handelsfonds (Parl. St Kamer, 2022-2023, doc 55 3231/001, 39)

    [14] Zie bv. Gent (7e bis k.) 21 maart 2016 over het belang van een concessieovereenkomst voor de uitbating van een wegrestaurant langs de autosnelweg en ergo voor  de waarde van haar handelsfonds.

    [15] N. VAN LANDUYT, “Schuldvergelijking en rechtsmisbruik in het kader van de wet continuïteit ondernemingen”, RABG 2011, afl. 9, 674.

    [16] I.t.t. de traditionele openbare reorganisatieprocedures, is er bij de besloten varianten geen automatisch moratorium, maar kan de aangestelde herstructureringsdeskundige de rechtbank om een ad hoc moratorium verzoeken (art. XX.83/24 WER).

    Art. 1675/9, §3 Ger.W. doorstaat een (beperkte) grondwettigheidstoets

    GWH 19 september 2024

    In het kader van een collectieve schuldenregeling moet een schuldeiser aangifte doen van zijn schuldvordering bij de schuldbemiddelaar. Hij doet dat uiterlijk een maand na toezending van de beschikking van toelaatbaarheid (art. 1675/9, §2 Ger.W.). De schuldeiser krijgt standaard wel een tweede kans; indien hij niet binnen voormelde termijn aangifte van schuldvordering deed, brengt de schuldbemiddelaar hem ervan op de hoogte dat hij over een laatste termijn van vijftien dagen beschikt. Een derde kans is er echter niet. Indien de aangifte niet binnen die ultieme termijn werd gedaan, wordt de betrokken schuldeiser geacht afstand te doen van zijn schuldvordering. Gevolg daarvan is dat hij het recht verliest zich te verhalen op de schuldenaar en de personen die voor hem een persoonlijke zekerheid hebben gesteld. Hij herwint dat recht (slechts) in geval van afwijzing of herroeping van de aanzuiveringsregeling (art. 1675/9, §3 Ger.W.).

    Het Grondwettelijk Hof oordeelde in een arrest van 19 september 2024 dat artikel 1675/9, §3 Ger.W. het eigendomsrecht niet onredelijk beperkt. Meer precies was de vraag of de sanctie waarin de paragraaf voorziet in geval van niet-tijdige aangifte van schuldvordering – het geacht worden afstand te doen van schuldvordering – en die de rechter moet opleggen in geval van onsuccesvolle wettige verwittiging van de schuldeiser, een onevenredige inperking van het eigendomsrecht vormt.

    Continue reading “Art. 1675/9, §3 Ger.W. doorstaat een (beperkte) grondwettigheidstoets”

    Rechtsmisbruik is geen zelfstandige grond voor weigering van kwijtschelding – Cassatie

    Cass. 28 juni 2024

    Louter op grond van rechtsmisbruik kan de kwijtschelding van een gefailleerde niet worden geweigerd. Zo bevestigt een cassatiearrest van 28 juni 2024.

    De Franstalige eerste kamer casseert een arrest van het Brusselse hof van beroep omdat het op grond van rechtsmisbruik weigerde een financiële consultant kwijtschelding te verlenen. De feiten illustreren nochtans de noodzaak van uitzonderingen op het “recht” op kwijtschelding. De man had al verschillende faillissementen achter de rug, waaronder een aantal als aandeelhouder en/of bestuurder van vennootschappen waarvoor hij zich borg had gesteld. Dat leverde hem in de periode 2015 tot 2019 een aanzienlijke schuldenlast op. Op 1 oktober 2019 wordt hij, ietwat cynisch, zelfstandig financiële consultant als natuurlijke persoon-ondernemer. Op Valentijnsdag 2020 doet hij aangifte van faillissement en dient hij een verzoek tot kwijtschelding in (het oude recht is immers van toepassing). Het passief is aanzienlijk en bestaat, zo luidt het verslag van de curator, voornamelijk uit de persoonlijke schulden die dateren van vóór de opstart van zijn nieuwe activiteit.

    Continue reading “Rechtsmisbruik is geen zelfstandige grond voor weigering van kwijtschelding – Cassatie”

    The Anatomy of Corporate Insolvency Law (Bork & Mangano)

    A post by professor Reinhard Bork

    Modern insolvency law has nothing in common with the grim reality depicted in certain Victorian novels of debtors subjected, not to insolvency proceedings, but to imprisonment even for indefinite periods. Since then, however, insolvency law has become a subject of extraordinary relevance and increasing intellectual fascination.

    On the one hand, academics, policymakers, lawmakers, judges, and practitioners have reoriented this field of law in order to facilitate the rescue of distressed companies for as long as possible. On the other hand, this evolution has reshaped some of the most traditional categories of our legal culture. For example, this new deal has introduced into the toolbox of insolvency practitioners a great number of devices that combine the flexibility of contractual workouts with the capability of insolvency proceedings to bind even the most recalcitrant of creditors – as a result, in some cases the traditional distinction between “contract” and “proceedings” has blurred. The same tendency in favour of rescue has persuaded some lawmakers to enable distressed companies to depart from the traditional criteria according to which the debtor’s assets must be distributed – traditionally, these criteria were considered as non-negotiable – and even to waive a milestone of every company law according to which a company’s shareholders are the company’s residual claimants. A further consequence of this new approach is that in the case of group insolvencies there has been a tendency to mitigate the traditional single-entity approach according to which there ought to be one set of insolvency proceedings for each distressed company.

    This finding does not relate to the insolvency law of a specific state, but to the world of all insolvency laws as a whole. Against this background, it can be an appealing task not to present and analyse a very specific insolvency law, but to ask a group of internationally outstanding scholars to examine certain core issues of insolvency law from an overarching, quasi supra-national perspective. Together with my co-editor Renato Mangano, I have now taken on this task in the book The Anatomy of Corporate Insolvency Law (Oxford University Press 2024).

    Continue reading “The Anatomy of Corporate Insolvency Law (Bork & Mangano)”

    De termijn tot aangifte van een schuldvordering in een faillissement kan niet omzeild worden langs de achterdeur (Cass. 12 april 2024)

    Een post door gastblogger mr. Vincent Verlaeckt

    1. Het Hof van Cassatie heeft in zijn arrest van 12 april 2024 (C.23.0415.F/1) bevestigd dat de aangiftetermijn tot het indienen van schuldvorderingen niet kan omzeild worden door een schuldvordering op te nemen in een proces-verbaal van verificatie dat wordt neergelegd na de aangiftetermijn van 1 jaar met het doel deze schuldvordering via de betwistingsprocedure alsnog te laten opnemen in het passief middels een vonnis.

    Continue reading “De termijn tot aangifte van een schuldvordering in een faillissement kan niet omzeild worden langs de achterdeur (Cass. 12 april 2024)”