Out-of-Court Restructurings

Out-of-court Restructurings will be conducted through discussions and negotiations with financial creditors, and usually trade creditors are not subject to standstill or restructuring plans under Out-of-court Restructurings. Out-of-court Restructurings are implemented on a confidential basis, which enables a debtor to minimize the decrease in its enterprise value. Our firm first seeks for the possibility of arriving at Out-of-court Restructurings when our clients are having financial difficulties. Various processes for Out-of-court Restructurings are available in Japan such as the Turnaround Alternative Dispute Resolution by the Japanese Association of Turnaround Professionals, restructuring assistance provided by the Small and Medium-sized Enterprise Revitalization Support Council, the Regional Economy Vitalization Corporation or the Resolution and Collection Corporation, Guidelines for Out-of-Court Workout and Special Conciliation. Ad hoc Out-of-court Restructurings without involving any of the associations or organizations described above are also possible. Our firm is able to advice on the most appropriate Out-of-court Restructurings scheme depending on the situation that our clients face, including creditor clients.

Our Newsletter related to this practice area
(1)Case study on whether making a request for moratorium to bank creditors in completely out-of-court restructuring proceedings is considered a suspension of payment - Judgement of the Osaka District Courton March 22, 2017 -
(2)Introduction to Special Conciliation Proceedings for Corporate Restructuring
(3)Guides for Use of Special Conciliation by the Japan Federation of Bar Associations - Rehabilitation Support Type, Business-Owner-Guaranteed-Obligations Restructuring Type, and Business Discontinuation Support Type -
(4)Serial Article: Trends in Bankruptcy Cases during the Novel Coronavirus Pandemic (3) - Out-of-Court Restructuring (SME Revitalization Support Council/Business Restructuring ADR
(5)How to Avoid Invalidation of Joint Liability - Contracts for Revolving Guarantees by Individuals and Avoidance of Gratuitous Acts

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