Legal framework of preventive restructuring in the EU: experience for Ukraine at the modern stage

The article describes the legal framework for preventive restructuring in the EU enshrined in EU Directive 2019/1023 and its significance for the adaptation of Ukrainian legislation. The author emphasises the importance of early warning procedures for insolvency aimed at preserving business viability, minimising losses for creditors and debtors, and protecting Ukraine's economic potential. Particular attention is paid to micro, small and medium-sized enterprises (MSMEs), which suffer the most from the consequences of the war due to the shortage of personnel, debt burden and limited access to finance. The author reveals the key provisions of the Directive, including cross-class cram-down, the best interests of creditors test and the possibility of maintaining debtor's control over the business, which contribute to the creation of a balanced early warning system with minimal judicial intervention. The author identifies the role of the EU legal framework in harmonising restructuring procedures, taking into account international recommendations of the World Bank, UNCITRAL and INSOL International, and emphasises the importance of simplified procedures for MSMEs, which allow to optimise costs, maintain control of owners and provide a ‘second chance’. The author identifies current challenges for Ukrainian business, including debt burden, falling demand and the staffing crisis, and emphasises that the introduction of effective mechanisms for preventive restructuring is important for stabilising the economy. It is noted that the adoption of Law of Ukraine No. 3985-IX of 19 September 2024, which introduces the relevant procedures, opens up new areas of research, in particular, on their adaptation to national conditions. It is determined that the development of criteria for the threat of insolvency, tools for its early detection and measures to counteract abuse remain important. It is emphasised that studying the effectiveness of innovations will help restore business solvency and economic stability of Ukraine.

preventive restructuring, insolvency, bankruptcy, EU Directive 2019/1023, early warning, European integration, military aggression, court procedures, creditors' rights, micro, small and medium-sized enterprises (MSMEs).