Clifford Chance

New German Restructuring Scheme - A Revolution of German Restructuring Law

8 January 2021

The long-discussed bill for the "further development of the German restructuring and insolvency Law (SanInsFoG)" entered into force on 1 January 2021. Its core is dedicated to a newly introduced pre-insolvency restructuring procedure (StaRUG or "German Scheme"), which for the first time allows for the restructuring of debtors by means of a restructuring plan outside of German insolvency proceedings whilst enabling cross-group cram-down decisions. The German Scheme has elements of the well-known British Scheme of Arrangement as well as the new Dutch Scheme and is in its implementation, largely adapted from the German insolvency plan procedure.

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