Vol 15 (2018) - Issue 6

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Hard Choices: Restructuring and Insolvency Dealmakers Face Uncertainty Ahead of Possible 'Hard Brexit'

Summary
The UK Government has issued guidance on the prospect of a 'no deal' Brexit, including the possible future of the cross-border European restructuring and insolvency landscape. In this article, the authors consider the potential practical implications of this scenario.

Introduction
A 'no deal' Brexit would negatively impact the UK’s restructuring and insolvency framework, the force of which depends, in part, on its pan-European reach. Losing the ability to deal with insolvencies via a single process, with automatic recognition across the EU, would make it more complex, lengthy and expensive to resolve cross-border mandates, with the prospect of parallel proceedings. This would jeopardise the prospect of rescue and reduce returns for stakeholders – and undermine the UK’s status as a leading global restructuring hub. We – like the UK government – hope for a post-Brexit agreement that reflects the principles of mutual cooperation enshrined in the current EU framework.