Debt Resolution and Business Exit

completed

The project consists of two main components: 1. Improving the regulatory framework for insolvency practitioners (IPs) through the development of a licensing scheme for practitioners, which will increase their skills and competencies in managing all aspects of the distressed firm, supervising operations and safeguarding its property and assets in accordance with national insolvency law and international best practices. 2. Developing informal business Out-of-Court (OCW) guidelines that would enable a debt restructuring plan to be developed on a bilateral or multilateral basis between the debtor and the creditor(s) without interrupting the business of the debtor. This would reduce the time and cost needed to re-organize within courts, reduce the stigma associated with insolvency proceedings, and assist in developing confidence in the fairness and accountability of the processes. OCW would be the first step in corporate restructuring. IFC would utilize the OCW toolkit that has been developed in Romania and Croatia and will enhance it to suit the local context in collaboration with the banking sector and financial institutions. The guidelines would cover the fundamental principles, the mechanics and application, the restructuring plan and communication strategy.