The Reform of Italian Insolvency Law: A New Preventive Restructuring Framework

Italy recently enacted a new insolvency code (the "New Insolvency Code"), which takes effect August 14, 2020. The New Insolvency Code sets up, inter alia, (i) a new preemptive restructuring framework; (ii) new rules encouraging new and interim financings by both lenders and equity holders whose claims can be satisfied with priority over both secured and unsecured claims in case of subsequent insolvency; (iii) new tools providing for the repayment in full of dissenting creditors, but at the same time (iv) the possibility to satisfy a claim by equivalent and to extend any stay of individual actions or maturity extensions to dissenting creditors.

In particular, as a first in the Italian insolvency framework, the New Insolvency Code establishes new out-of-court proceedings providing for specific alert mechanisms, assisted negotiations with creditors, and procedures aimed at preventing crises (thus insolvency), as well as insolvency proceedings specifically tailored for groups of companies. The New Code will be in line with the newly enacted European "Harmonization Directive" no. 2019/1023, encouraging the prevention of crises, an easier recovery therefrom, and restructuring proceedings mainly based on the principle of continuation of distressed businesses.

Read the full White Paper.

Insights by Jones Day should not be construed as legal advice on any specific facts or circumstances. The contents are intended for general information purposes only and may not be quoted or referred to in any other publication or proceeding without the prior written consent of the Firm, to be given or withheld at our discretion. To request permission to reprint or reuse any of our Insights, please use our “Contact Us” form, which can be found on our website at This Insight is not intended to create, and neither publication nor receipt of it constitutes, an attorney-client relationship. The views set forth herein are the personal views of the authors and do not necessarily reflect those of the Firm.