Examinership in the EU

When companies start slipping toward insolvency, liquidation often seems inevitable. Yet across the European Union, there is growing recognition that saving a struggling business can sometimes create far more value than dismantling it. Examinership stands as one of the most important, if understated, tools in this effort. It may not grab headlines like massive mergers or courtroom battles, but it plays a vital role in giving businesses a second chance to survive and thrive.

Examinership, most notably developed in Ireland but echoed in several European restructuring frameworks, offers companies a breathing space from creditor pressure. If a business can show it has a reasonable prospect of survival, the court can appoint an independent examiner. The examiner’s mission is to devise a plan to save the business, restructure its debts, and secure new investment, all while creditors are temporarily held at bay. The court-driven nature of the process ensures that there is oversight, but also that there is room for creative solutions beyond the typical binary choice of survival or liquidation.

In Ireland, examinership is grounded in the Companies Act 2014, with its roots in the Companies (Amendment) Act 1990. Courts take a cautious but supportive approach: they grant protection only when genuine prospects exist, and they expect strict adherence to a pre-stated timeline, typically 70 days, with limited extensions. The system recognizes that urgency is critical. Allowing businesses to drift through indefinite restructuring would not serve creditors or the wider economy.

Directors retain their formal roles during examinership, but their reality changes dramatically. They must work closely with the examiner, providing access to all necessary information and cooperating fully with the restructuring efforts. Their duty of loyalty, once centered mainly on shareholders, pivots sharply toward creditors when insolvency looms. This mirrors a broader trend across the EU, where directors are expected to step up and address financial distress early rather than allowing problems to spiral out of control.

The examiner’s task is not easy either. They must identify realistic paths to survival, often negotiating haircuts with creditors, securing fresh financing, or reworking shareholder structures. Creditors can object to the proposals, and their voices are heard at confirmation hearings. However, they cannot simply veto a viable restructuring plan. If the court is convinced that the plan treats creditors fairly and offers a better outcome than liquidation, it can approve it even over creditor opposition. This element reflects a crucial principle, that insolvency law must balance the interests of creditors with the larger goal of preserving businesses that still have economic value.

At the EU level, examinership aligns closely with the spirit of the Preventive Restructuring Directive (Directive (EU) 2019/1023). The Directive encourages Member States to create early intervention frameworks that keep businesses alive while ensuring creditor rights are respected. Across Europe, the move is clear: courts and legislators are reimagining insolvency not simply as a mechanism for orderly death, but as a tool for corporate healing where possible.

While examinership is rather closely associated with Ireland, similar procedures have taken root across the continent. France’s “sauvegarde” and Germany’s “Schutzschirmverfahren” are different in form but share the same DNA; a belief that timely, structured intervention can save jobs, protect supply chains, and maintain value for all stakeholders. These processes recognize that occasionally liquidation is a failure of imagination, not an inevitability.

The European Union’s ongoing harmonization efforts continue to push Member States toward earlier and more effective restructuring models. The focus is on debtor-in-possession procedures and strong protections for creditors and investors alike. Examinership remains a leading model for how structured, court-supervised corporate rescue can work in practice, blending accountability with the flexibility businesses need during moments of crisis.

Although examinership can be complex and expensive, it remains a powerful option for companies facing temporary but still severe challenges. It demands swift action, honest assessment, and shared sacrifice among all parties involved. Success is not guaranteed, but when it works, the rewards are substantial. Preserved jobs, stabilized businesses, and better returns for creditors than liquidation would ever achieve.

The spirit of examinership reflects a growing European consensus. Businesses are worth saving when possible. Insolvency law, when taken in use thoughtfully, is not just about ending companies. It is about giving them a fighting chance to recover, rebuild, and contribute again to economic life. That is a vision well worth striving for.