Insolvency: a survival guide
The collapse of Parmalat has forced European legislators to take a long, hard look at the laws governing insolvency. Moves are now afoot to bring these regimes more in line with a Chapter 11 style of bankruptcy legislation, as Oliver Holtaway discovers
In the days following the collapse of the Parmalat empire last November, Italian legislators rushed new bankruptcy laws through the Italian parliament. The food giant was clearly headed for insolvency, and while at that point 95% of insolvent Italian firms tended to end up in liquidation, Italian politicians were adamant that Parmalat would not. In order to save jobs (and therefore, they hoped, votes), legislators contrived a way to keep the company alive.
The entire incident was a wake-up call
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