Documents considered by the Committee on 19 December 2017 Contents

9Coordination of insolvency proceedings in the EU

Committee’s assessment

Legally important

Committee’s decision

Cleared from scrutiny; further information requested

Document details

Proposed Regulation replacing Annex A to Regulation (EU) 2015/848 on insolvency proceedings

Legal base

Article 81TFEU; ordinary legislative procedure; QMV


Business, Energy and Industrial Strategy

Document Number

(38963), 11667/17 + ADD 1, COM(17) 422

Summary and Committee’s conclusions

9.1Regulation (EU) No 2015/848 on insolvency proceedings came into force in June 2017 to provide for the efficient administration of insolvencies where the debtor’s centre of main interest (‘COMI’) is in the EU (the 2015 Regulation). The 2015 Regulation provides for exclusive jurisdiction for the “main” proceedings in the Member State where the debtor’s COMI is situated, with the possibility of other “secondary” or “territorial” proceedings in any other Member States where the debtor has an establishment.

9.2Annex A to the 2015 Regulation contains a list of insolvency procedures for each Member State which constitutes a definitive list of national proceedings which qualify as “insolvency proceedings” in the context of the Regulation.

9.3In January of this year the Republic of Croatia asked the Commission to update the Regulation to reflect substantive reforms to their national insolvency laws. The proposed Regulation will make those changes to Annex A of the 2015 Regulation. The Government informs us that the proposal will now additionally reflect changes to the national insolvency laws of Belgium, Bulgaria, Latvia and Portugal. The Government agrees with the Commission’s assessment that the changes to the national insolvency procedures concerned properly fall within the 2015 Regulation.

9.4The UK’s opt-in applies to the proposal which has a Title V JHA102 legal basis. The Government had until 15 November to notify the UK’s decision to the Council Presidency.103 The eight-week deadline for this Parliament itself to consider the opt-in104 expired on 10 October, before this Committee was formed.

9.5The Government now informs us that the UK has notified the Presidency that it is opting into the proposal given the UK’s existing participation in the underlying Regulation. Accordingly, the Government has now laid a Written Ministerial Statement in Parliament.105

9.6We thank the Minister for her letter.

9.7Now that the Government has told us that the UK is opting into what is only a technical Regulation, we are content to clear it from scrutiny. However, we expect a response from the Minister to the rest of the questions we raised in our Report of 13 November in due course. Broadly, those concerned jurisdictional and enforcement issues relating to insolvency proceedings taking place in the UK and the EU after Brexit.

Full details of the documents

Proposal for a Regulation of the European Parliament and Council replacing Annex A to Regulation (EU) 2015/848 on insolvency proceedings: (38963), 11667/17 + ADD 1, COM (17) 422.

The Minister’s letter

9.8In a letter of 11 December 2017, the Minister for Small Business, Consumers and Corporate Responsibility at the Department for Business, Energy and Industrial Strategy (Margot James) says:

“Further to Richard Harrington MP’s Explanatory Memorandum dated 30 August 2017 the government has now considered the proposal and has concluded that it is in the UK’s interests to opt-in to the amendments given the UK’s existing participation in the underlying Regulation. The Foreign Secretary has now communicated the decision to the Presidency.

“I would note that since the initial proposal, a number of other Member States (Belgium, Bulgaria, Latvia and Portugal) requested changes to the annexes to the EU Insolvency Regulation in addition to the original request from Croatia. As with the original request from Croatia, these changes reflect amendments to those Member States’ national insolvency laws. The Commission therefore produced a revised proposal incorporating these additional changes.

“I have laid a written statement in Parliament communicating this decision. I would like to take this opportunity to thank your Committee for its detailed consideration of the Commission’s proposal and related documents.”

Previous Committee Reports

First Report HC 301–i (2017–19), chapter 8 (13 November 2017).

102 Strictly speaking after the Lisbon Treaty, Justice and Home Affairs measures are known as measures falling within the Area of Freedom, Security and Justice.

103 Protocol No 21 to the EU Treaties require the opt-in decision to be notified within three months after a proposal has been presented to the Council pursuant to Title V of Part 3 of the TFEU.

104 See the Ashton undertakings on Parliamentary scrutiny of JHA opt-in decisions.

105 See HCWS315, 6 December 2017.

22 December 2017