The UK’s skinny Brexit deal could badly affect the rich diet of the London restructuring market after it lost the benefit of the EU Recast Insolvency Regulation (RIR) at the end of December. Lawyers and financial advisors had grown fat on high-profile European deals being shifted to the UK. But without a way to recognise UK judgments in the EU, they could face a reversal with tasty new menus with vastly improved fare from new Netherlands and German processes attracting favour, say legal experts.

Many high-profile law-firms were caught out by the lack of a failsafe in the EU/UK Trade and Cooperation agreement to replace RIR meaning there is a ‘no-deal’ in terms of insolvency recognition. Any proceedings opened after 31 December 2020 will require applications to the courts of each country where recognition is sought, lawyers concede in a plethora of client notes in recent days.

This could lead to an explosion of parallel processes. There is no going back to apply the law in each EU27 country that applied before, as RIR is now part of their domestic laws, notes South Square in their comprehensive briefing on the matter.