Austria implemented the directive on preventive restructuring frameworks more than two years ago, in July 2021. In a first ruling on the proceedings, the Vienna Higher Regional Court has reaffirmed the prerequisites for entering preventive restructuring and clarified the checks to be carried out by the courts at the opening of the proceedings. 

Decision

The Court held that:

• Preventive restructuring proceedings may only be initiated if the company is not insolvent under the Austrian Insolvency Code (Insolvenzordnung). 
• If the court finds, based on the application and the Austrian enforcement register (a register of pending enforcement proceedings) that the company is insolvent, the application for preventive restructuring proceedings must be rejected by the court.
• In this case, the court is not required to give the applicant the opportunity to rebut the court findings. 

Key takeaways

This decision highlights the importance of preparing the application for preventive restructuring proceedings thoroughly, any mistakes or ambiguous information may lead to the rejection of the application without the opportunity to rebut any findings of the court. 

Find out more

To discuss the issues raised in this article in more detail, please contact a member of our Restructuring & Insolvency team.

Oberlandesgericht Wien; case no. 6 R 200/22h