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ARTICLE · 17 FEBRUARY 2025

Enhancing Malta's Restructuring Framework: The Role Of Early Warning Tools In Pre-Insolvency Restructuring

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On 23 December 2022, the Pre-Insolvency Act (Chapter 631 of the Laws of Malta) ("Pre-Insolvency Act"), came into force, introducing new preventive restructuring procedures.

MaltaInsolvency/Bankruptcy/Re-Structuring
Christina Gingell
Christina Gingell
Chantelle Mercieca
Chantelle Mercieca
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On 23 December 2022, the Pre-Insolvency Act (Chapter 631 of the Laws of Malta) ("Pre-Insolvency Act"), came into force, introducing new preventive restructuring procedures. The Pre-Insolvency Act marks a significant advancement in the Maltese restructuring framework, complementing the pre-existing debt restructuring mechanisms, which include:

  1. the company recovery procedure as established by Article 329B of the Companies Act (Chapter 386 of the laws of Malta);
  2. private workouts, a voluntary, out-of-court negotiation process between a debtor and its creditors aimed at reaching a settlement; and
  3. compromises or arrangements, a hybrid mechanism that blends elements of both in and out-of-court procedures.

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