Frankfurt Regional Court declines to recognize the effect of Projekt Fürst’s restructuring plan, but this should not impact the recognition of English Schemes of Arrangement.
At a glance – key takeaways
In a recent judgment, the Frankfurt Regional Court (Landgericht Frankfurt) held that an English Part 26A restructuring plan could not be recognized and given effect in Germany. It is important to note that the judgement is a provisional judgement only rendered in a special documentary procedure (“Urkundenprozess”) in which evidence is generally limited to documents and records. The provisional judgement is therefore subject to subsequent proceedings in which evidence which was previously barred is admissible. In addition, the judgement of the Frankfurt Regional Court (Landgericht Frankfurt) is subject to appeal at the Frankfurt Higher Regional Court (Landgericht Frankfurt) and, if admitted, the German Federal Court of Justice (Bundesgerichtshof).
As regards the substance of the provisional judgement of the Frankfurt Regional Court (Landgericht Frankfurt), the court refused recognition of Projekt Fürst’s restructuring plan as an insolvency proceeding pursuant to section 343 of the German Insolvency Code because such restructuring plan lacked full collectivity, i.e. did not constitute an arrangement affecting all creditors of the debtor. The Frankfurt court also refused recognition as an ordinary civil matter judgement pursuant to section 328 of the German Code of Civil Procedure because the required reciprocity between verdicts of German and English courts could not be proven in such special documentary procedure (“Urkundenprozess”).
Although the judgment, unless overturned in subsequent or appeal proceedings, may render the recognition of Part 26A restructuring plans in Germany more challenging, the recognition of Schemes of Arrangement under Part 26 of the Companies Act should not be affected. In the recent judgement in the matter of Standard Profil GmbH ([2025] EWHC 2313 (Ch), the English High Court held that the reasoning of the Frankfurt Regional Court, even if it was correct and confirmed in subsequent and appeal proceedings, should not have any bearing on the recognition of Schemes of Arrangement as such verdicts are capable of being recognized under the Hague Convention or the Hague Judgements Convention.
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