The topic of the new law continues to ignite discussions among specialists in various fields. Probably many more people and their opinions will strengthen the discourse, which I consider to be a very good sign. For it shows how much change is needed in the restructuring of Polish companies.
The new Restructuring Law, which comes into force on 1 January 2016, is a milestone in the approach to saving companies out of crisis. It provides new recovery procedures, changing the culture of liquidation to the forefront of restructuring. And although many issues will change, the legislator does not close the way to introducing further improvements. During the work on the act, many good ideas were put forward, which were ultimately not adopted due to the extended time of their implementation. The legislator's idea was to implement new recovery procedures first, and then to refine subsequent changes. Otherwise, we would have to wait for years, and Polish companies would not be able to effectively defend themselves against bankruptcy.
I am not a defender of the Ministry of Justice or the act itself, but as a practitioner in the field of restructuring, I see the positive aspects of the changes and the opportunity for entrepreneurs who are currently in In a crisis, they can only benefit from the procedure arrangement, which is highly formalized. In particular, I would not demonize the specialization of a restructuring advisor.
The idea of the new profession is to provide comprehensive support to entrepreneurs whose companies found themselves on the brink of insolvency. The trustees, who until now had been mainly responsible for managing the bankruptcy estate, were delegated for this purpose. Nevertheless, it is worth emphasizing that the trustees' competences do not end there - this is a professional group that has also been performing restructuring tasks for a long time, often in out-of-court proceedings, but also those delegated by the court (arrangement proceedings). Therefore, it is not true that among the group of over 900 trustees there are no specialists in the field of restructuring processes. At the same time, I do not see any other professional group closer to this field to which the tasks of restructuring advisors could be entrusted.
The evolution of the receivership profession under the new Act is therefore the next stage in the natural process of development initiated by the 2007 Receivership Licence Act. It was at this point that many people who had been acting as receivers for sometimes 10,15 years decided not to upgrade their qualifications and obtain a licence from the Minister of Justice. This was the moment when the professional group underwent a far-reaching transformation. At the same time, it is worth pointing out that at the present time also many receivers do not intend to act as restructuring advisors. In addition, it is worth noting that a number of persons recognised in the environment, despite many attempts, cannot pass the exam for the licence of a receiver and obtain qualifications, which also proves that a person performing functions in proceedings must have extensive qualifications. Personally, among my fellow receivers, I notice people who only want to continue conducting liquidation proceedings and people who have already been preparing to provide services to entrepreneurs for at least two years. The new law introduces the possibility of choosing the adviser - until now the receiver was delegated by the court.
I also count this as a positive development. As in the case of legal services, the debtor or creditor will be able to decide for themselves the choice of their adviser. The new order therefore encourages the development of competition and the professionalisation of the profession. The best in the industry, who will be most effective in helping companies, will take the lead. Thus, it is the market that will verify the experience of advisers and entrepreneurs will be able to use their services as they see fit. The commercialisation of advisers' activities will shape greater diligence in their execution, which will also have a positive impact on the market.
Increasing the competence of specialists will also be facilitated by the consolidation of the market permitted by the legislator. The creation of restructuring companies, whose competitive advantage will be the exchange of knowledge potential and experience, is the new order of the market for restructuring advisory services. The benefits of this solution will be particularly felt by clients, i.e. entrepreneurs.
In response to the allegations concerning the lack of coverage for possible damages of the decisions of restructuring advisors, it is important to emphasise the fact that, like lawyers, receivers, and soon also restructuring advisors, there is mandatory liability insurance. It should also be recalled that, already today, receivers guarantee with their own assets for all actions concluded under their jurisdiction.
It should also be noted that the trustee is a profession of public trust, whose mission is to care for and support the realisation of the public interest. Hence the wide range of competences that a specialist in this field already has to handle. According to the new act, the tasks of receivers have been expanded
for restructuring advice, i.e. assistance in obtaining financing, determining the direction of strategic changes, cost restructuring and negotiations with creditors. The profession of a restructuring advisor will therefore be a set of interdisciplinary competences related to cross-sectional knowledge and experience in all aspects of the functioning of an enterprise, in particular the economic and legal environment.
I have conducted many restructuring processes. Working in the National Chamber of Trustees and the District Chamber of Trustees in Wrocław, I got to know the professional environment well, so I am not worried about the fate entrepreneurs and their companies after the New Year. I am sure that thanks to the new regulations and the possibility of cooperation with experts at risk companies will cope with problems more effectively. The support of advisors at the pre-trial stage may be particularly valuable. Professional support from restructuring practitioners will certainly improve this situation, especially in the sector small and medium-sized companies.
Therefore, it is worth discussing what else can be improved, but let's not cross out the New Restructuring Law even before it has come into force. I believe that the skillful application of new possibilities will bring many useful changes, will streamline restructuring proceedings and thus save many companies from bankruptcy, supporting the country’s economy and protecting jobs.
9 October 2015:
" Restructuring advisers will be vetted by the market
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