Securities in Insolvency Proceedings in CEE

Project Details

Financing body

Jubilee Fund of the City of Vienna for the Vienna University of Economics and Business Administration

Oesterreichische Nationalbank (Jubiläumsfonds)

Description

Since the fall of the Iron Curtain, the economies and legal systems in the CEE region have experienced dramatic changes. After the end of communism, certain parts of the legal frameworks had to be set up from scratch, taking into account the rapidly changing economic and social environment and the challenges of rapidly growing market economies. The CEE countries managed, however, to blend into the international business world and were successfully integrated into the Common Market with amazing speed. Rather, the European economy as a whole has become more and more interconnected, and therefore international finance as well as international bank consortia are an integral part of the modern business world in the EU 28. Many bank loans are granted cross-border; other loans are made by national credit institutions, which, however, are subsidiaries of foreign based banking groups.
Consequently, insolvency proceedings in CEE, covering new and prospective future member states, have an impact not only in the respective countries, but also on the European economy as a whole, as receivables and claims of national and international creditors and investors alike are reduced to a quota and have to be written off in part or, in the worst case, in their entirety.
Therefore, the legal status of secured creditors during insolvency proceedings of debtors in CEE is of special interest for the economy and society on the national, but also on the European level. However, practical experience and a number of high-profile cases have shown that the predominant securities do not always provide the protection creditors expect. Additionally, in recent times, time-honored practices have been adapted, as far-reaching changes to the legal framework for securities and insolvency proceedings have been made in many CEE-countries within the last years. Literature dealing with these new issues is scarce. The findings are also of interest for group structures of international businesses.
StatusFinished
Effective start/end date1/01/131/01/16

Austrian Classification of Fields of Science and Technology (OEFOS)

  • 505048 Property law
  • 505031 Civil law