Many of our clients are international clients acting either regionally or even globally. The cross-border insolvencies bring a lot of complexity to the cases as it entails a close cooperation between the participants to the procedures in the relevant jurisdictions.

Our team members have handled one of the first cross-border insolvencies in Romania and have handled several cross-border reorganizations and bankruptcies, such as Nortel Networks, Alitalia, Goldplast.

According to Art. 3 Para. 1 of the Regulation (EU) 2015/848 (“Regulation”), the courts of the Member State within the territory of which the center of the debtor’s main interests is situated shall have jurisdiction to open insolvency proceedings (“main insolvency proceedings”).

The center of main interests shall be the place where the debtor conducts the administration of its interests on a regular basis, and which is ascertainable by third parties. In the case of a company or legal person, the place of the registered office shall be presumed to be the center of its main interests in the absence of proof to the contrary. That presumption shall only apply if the registered office has not been moved to another Member State within the 3-month period prior to the request for the opening of insolvency proceedings.

Also, according to Art. 3 Para. 2 of the Regulation, where the center of the debtor’s main interests is situated within the territory of a Member State, the courts of another Member State shall have jurisdiction to open insolvency proceedings against that debtor only if it possesses an establishment within the territory of that other Member State. The effects of those proceedings shall be restricted to the assets of the debtor situated in the territory of the latter Member State.

Given this, the recognition of the main insolvency proceedings shall not preclude the opening of the proceedings referred to in Article 3(2) by a court in another Member State. The latter proceedings shall be secondary insolvency proceedings, being governed by the provisions of Chapter III from the Regulation.