The European Insolvency Regulation (EIR 2015) dictates that its overarching definition for “insolvency proceedings” are proceedings that are listed exhaustively in Annex A. To the national procedures contained in Annex A, the EIR 2015 should apply without any further examination by the courts of another member state as to whether the conditions set out in the regulation are met, while national insolvency procedures that are not listed in Annex A are not covered by the EIR 2015.
In a column for Global Restructuring Review (GRR) from February (in slightly adapted version published on https://bobwessels.nl/blog/2025-03-doc1-annex-a-and-the-erosion-of-european-insolvency-law/), I took a gloomy view of the way Annex A has been utilised. Presumably some ten member states have had their proceedings, as an implementation of the Directive 2019/1023 on Preventive Restructuring Frameworks (PRD 2019/1023) listed in the annex. What about the other member states? Doesn’t this lack of regulatory activity undermine the very foundation of the system for recognising foreign insolvency proceedings in the EU?
I could hardly have imagined that some two weeks before I wrote the column, the European Commission issued a proposal to replace Annex A – and Annex B, with national names of those who qualify as “insolvency practitioner” in the meaning of Article 2(5) EIR 2015. What’s on the table with this February 2025 proposal of the European Commission?
A first observation is that we enter again into the wonderful language landscape of the EU. The term “framework” included in the words “preventive restructuring frameworks” in Article 1(1)(a) PRD 2019/1023 does not have a specific meaning. In other languages the plural “preventive restructuring frameworks” has been translated as “präventive Restrukturierungsrahmen” (German), “los marcos de reestructuración preventive” (Spanish), “les cadres de restructuration preventive” (French), “quadri di ristrutturazione preventive” (Italian) or “preventieve herstructureringsstelsels” (Dutch). Where the word for “framework” differs, the term “preventive” seems to be a clear-cut translation in all these languages. Not all readers would mind, but I do: the parts in these non-Dutch language designations for “framework” are in Dutch “stelsel”, “kader” and “raamwerk”, which are translated in my Dutch-English dictionary as “system”, “frame”, “framework” or “outline”, respectively. This is all rather vague.
A second observation relates to the framework’s legal meaning. What, legally, is a “framework”? In Lewis Carroll’s “Through the Looking-Glass”, Humpty Dumpty provides certainty: “When I use a word, it means just what I choose it to mean – neither more nor less.” But, in European law, we need more. A “framework” as such is not a uniform legal figure of speech, as it is not a unique, unequivocally word or legal term that would fit in the categories that are known in EU private international law instruments. It is a figure of speech in its own right. The EU legislator helps: a “preventive restructuring framework” is composed of “one or more procedures, measures or provisions, some of which may take place out of court,” see Article 4(5) PRD 2019/1023. It is a collection, a hodgepodge if you will, of legal figures.
In my earlier column I signalled that new national proceedings of some ten EU member states have been listed on the latest known Annex A, published in early 2022. In the February 2025 proposal of the European Commission, it can be noted that, among other things, in Belgium two “new” proceedings are listed, being two “public” proceedings related to a restructuring compromise, Luxemburg added three new proceedings, as did Malta. For Spain, the existing four processes on the Annex of 2022 for all its listed proceedings have been replaced by four new ones: “Concurso de acreedores”, “Comunicación pública de apertura de negociaciones con los acreedores”, “Planes de reestructuración”, and “Procedimiento especial para microempresas”. A next quiz question: where the term “preventive restructuring framework” had been translated in “los marcos de reestructuración preventive”, only the third one mentioned has some resemblance in the letters used.
Looking at the newly proposed Annex A, it strikes that it now contains no less than 135 national names for insolvency proceedings, for 27 EU member states. Several countries, with respect, are infected with a national growth disease. According to the proposed Annex A, both Cyprus and Luxemburg have eight national proceedings, Belgium and Malta nine, Ireland ten and Italy no less than thirteen national insolvency proceedings. The proposal went to the European Council in July and it is on the agenda of the European Parliament, just following the ordinary legislative proceedings for a regulation.
In column mentioned I submitted that the system of the EIR 2015 working with these annexes had grown to become a mockery of a sound and efficient system of European insolvency law. But my objection is more principled. The commission writes in its proposal: “The amendments are of a purely technical nature.” This passage (cut and pasted from earlier proposals to review the annexes) demands more attention in the present day. This so-called technical amendment leads to several purely domestic, national insolvency proceeding from member states being promoted automatically to the EU’s top international league of insolvency proceedings. These proceedings will be recognised in other member states without further review. This also exposes a fundamental flaw in the system of working with annexes. In a proposal, an executive body makes a decision with powerful legal consequences. In my opinion, this can only be done when this body bases it decision on an internal independent review. Again, the list system is in urgent need of revision.
References
Proposal for a Regulation of the European Parliament and of the Council amending Regulation (EU) 2015/848 on insolvency proceedings to replace its Annexes A and B (COM(2025) 40 final, Brussels, 12.2.2025, 2025/0023 (COD).
This is a slightly adapted version of a regular column Bob Wessels is writing for Global Restructuring Review (GRR) on the topic of cross-border restructuring and insolvency in a European context. GRR is a subscription-only publication and the column appeared in GRR on 9 August 2025. See www.globalrestructuringreview.com.