UDC 347.736/.739(4-672EU)
Biblid: 1451-3188, 19 (2020)
Vol. 19, No 71, pp. 5-21
DOI:

Оriginal article
Received: 20 Oct 2019
Accepted: 15 Dec 2019

DIRECTIVE 2019/1023 OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL ON PREVENTIVE RESTRUCTURING FRAMEWORKS

DIMITRIJEVIĆ Duško (Institut za međunarodnu politiku i privredu, Beograd), dimitrijevicd@diplomacy.bg.ac.rs

In certain situations, enterprises and entrepreneurs may find themselves in considerable financial difficulty, which is often a result of over-indebtedness, technical and technological obsolescence, inadequate organizational structure, and a large number of employees, which all, more or less, affects their unproductiveness, unprofitability and uneconomic. For the financial recovery of such entities, on 20 June 2019, the European Parliament and the Council adopted Directive 2019/1023 on preventive restructuring frameworks. The said Directive is establishing an institutionalized reorganization model necessary for the preservation of the aforementioned entities in the internal national market. Unlike the bankruptcy procedure, which, as a rule, leads to disqualification, that is, the elimination of companies from the market, preventive restructuring provides a “second chance” for their survival in the economic systems of the Member States. Restructuring involves the implementation of preventive measures such as discharge of debt (which often involves writing off or rescheduling them), as well as implementing a reorganization aimed at changing the composition and structure of assets and capital, maintaining control of current operations and optimally regulating redundancies. In addition, special emphasis in restructuring is on the long-term viability of business entities and avoiding bankruptcy, which could endanger the interests of creditors and owners, as well as the economic system as a whole. The implementation of the Directive, therefore, contributes to the achievement of a plan of economic consolidation and social cohesion within and outside the European Union.

Keywords: Restructuring, bankruptcy, insolvency, discharge of debt, European Union