The aim is to avoid bankruptcies and save jobs. Ireland already has an examinership system, modelled on the US rules that allows the courts to impose deals on creditors in order to save jobs.
The proposed EU rules go further. In a bid to encourage risk-taking start-ups, the proposal would make it easier for entrepreneurs in Europe to get a second opportunity after a business failure, as in the United States.
The rules proposed by the European Commission would allow troubled firms to stop paying suppliers and banks while restructuring their debt during a four-month “breathing period”, extendable to a maximum of one year in exceptional cases.
“Every year in the EU, 200,000 firms go bankrupt, which results in 1.7 million job lo…
Read the full article at: http://www.independent.ie/business/irish/eu-plans-chapter-11-style-debt-rules-35237502.html