1. “German Scheme” available from 1 January 2021 in (slightly) modified form
The German Federal Parliament finally adopted the long-awaited bill to introduce a new pre-insolvency business stabilization and restructuring regime into German law.1 The new law was published in the German Federal Gazette on 29 December 2020 and will enter into force on 1 January 2021.
The availability of the ground-breaking new “German Scheme” from 1 January 2021 onwards will significantly change the German restructuring landscape and elevate it to an internationally competitive level. In particular, the German Scheme will close the gap between consensual out-of-court restructurings and in-court restructurings since, in the past, the latter could only be implemented in Germany by means of comprehensive insolvency proceedings.
When compared to the draft bill for the new German Scheme presented by the German Government in October 2020, the final bill adopted by the German Federal Parliament differs from the previous draft in the following key respects: