|By Tommaso Foco | Ginevra Sforza |Portolano Cavalo Studio Legale
Following the approval by the Parliament of Law No. 155/2017 setting forth the principles for a thorough reform of bankruptcy law, the Italian Government is now working on the delegated law that is bound to replace the more than 70-years old Bankruptcy Act (1942).
The new law will consolidate in one single act the various changes to the Bankruptcy Act that have been made since 2005 and will provide a more efficient and modern set of rules for insolvency. In an effort to mark the distance from the 1942 Bankruptcy Act and to remove the social stigma that has been traditionally associated with the idea of bankruptcy, the new law will even replace the term “bankruptcy” with “judicial liquidation”. The distance with 1942 Bankruptcy Act, however, is far from being limited to a semantics. The principles driving the Government in reshaping Italian bankruptcy legal framework include the following:
(i) the new law will draw a clear distinction between “crisis” and the “insolvency” in order to provide businesses that are not in state of insolvency with a specific set of tools designed to allow recovery of the business (as opposed to liquidation and termination) so as to give honest but bust entrepreneurs a second chance;
Compliments of Portolano Cavalo Studio Legale, a member of the EACCNY