CRISIS PREVENTION AS A CHANCE FOR BUSINESS RECOVERY IN THE EUROPEAN UNION

DOI: 10.5937/etp2403053D

Abstract

With the entry into force of Directive No. 2019/1023 on
Frameworks for Preventive Restructuring, clear and transparent legal
instruments were introduced for crisis prevention in business
operations of economic entities throughout the single market of the
European Union. They involve early detection of circumstances that
may lead to insolvency and encourage a response without delay. The
key goal is to overcome the debtor's financial difficulties at an early
stage, and when possible, prevent insolvency and ensure business
sustainability. With the introduction of new instruments into the
national legislation, the area traditionally governed by the norms of
bankruptcy law, which are mostly of an imperative nature, has been
entered. This was done by defining the circumstances that precede the
reasons for bankruptcy and by providing instruments to protect the
debtor from enforcement. The new instruments, on the other hand, are
of a consensual legal nature, that is, governed by dispositive norms.
The authors of this paper analyze the preventive instruments, their
way of introduction into the legislation, as well as the particularity of the new legal regime in important economies in the EU, using the
normative and comparative law method. This article presents an
analysis of the application of the new regulations, which have been in
force for two years, and the results of their implementation.