9fin travelled to Milan to chat with restructuring practitioners about the latest reform to Italian bankruptcy law, enacted in July 2022. There has yet to be a big restructuring case in Italy to test out the changes but practitioners had diverging opinions about how it would be used in practice.

On 15 July 2022 the new Italian Corporate Crisis and Insolvency Code (CCI) (codice della crisi d’impresa e dell’insolvenza) came into force. This replaced the original Italian Bankruptcy Law, which came into place in 1942.

The reform in the law was intended to modernise the Italian insolvency regulatory framework by following up on requests by the European legislature promoting the harmonisation of the laws of Member States.

The EU directive sets out minimum standards which include debtors remaining in possession of their assets and day-to-day operation of their business; stay of enforcement; the ability to propose a restructuring plan that includes a cross-class cram-down mechanism and protection for new financing and other restructuring-related transactions. It doesn’t prescribe processes, instead it allows individual jurisdictions to amend their existing processes and protocols.