Highlights of the new Polish restructuring legal framework

Warsaw, 9 November 2017

The long-time debate on the new restructuring procedures in Poland yielded a specific piece of legislation. The new Polish Restructuring Law provides a brand new array of restructuring procedures implementing the so-called “second chance” policy for businesses.

Election of the Suitable Procedure

The Polish Restructuring Law introduces new procedures, allowing the restructuring of a debtor’s business and the possibility to choose the form of restructuring customized to the exact needs of a business and its financial situation.

The arrangement approval on more than 15% of the disputed claims requires the approval of the majority of the creditors. Such approval can be taken with at least 2/3 of the sums owed to voting creditors, even omitting all voting creditors having disputed claims (up to 15%). If no resolution is obtained then the decision is made by creditors holding at least 51% of the total sum of claims of voting creditors.

Partial Restructuring

Under the law, we note that a selected group or groups of creditors can enter into a restructuring arrangement of their claims. As a matter of principle, the common interest of creditors takes priority over the interest of a single creditor or group of creditors. The Polish Restructuring Law provides for instruments to balance and, where possible, jointly pursue these interests.