LUXEMBOURG Law and Practice Contributed by: Laure-Hélène Gaicio Fievez, Fabio Trevisan and Carolina Vasselli, BSP
1.3 Statutory Officers Bankruptcy Trustee
Restructuring Proceedings Following the entry into force on 1 November 2023 of the Law of 7 August 2023, the following measures were introduced: • conciliation (conservative measure); • restructuring by mutual agreement ( réorganisation par accord amiable ) – out-of-court arrangement; and • judicial restructuring procedure ( réorganisation judiciaire ) – judicial measure. The purpose of the restructuring proceedings is to preserve the continuity of all or part of the assets and activities of the debtor. The debtor must establish that the continuity of its business is threatened at term. The judicial procedure can be opened with the aim of either (i) obtaining the creditor’s agreement to a reorganisation plan or (ii) selling, by way of judicial decision, the debtor’s assets and activities to one or more third parties. Liquidation Liquidation is not an insolvency procedure per se. Luxembourg has not listed in Annex A of the EU Insolvency Regulation (Recast), which contains the insolvency proceedings that each member state rec - ognises as falling within the Regulation’s definition of “insolvency proceedings” and therefore subject to its scope. The liquidation procedure is rather a sanction provided by Article 1200-1 of the Law on commercial companies dated 10 August 1915, as amended (LCC), imposed in case of a breach of this law. Proceedings can only be opened at the request of the public pros - ecutor. Alternatively, a shareholder can ask for judicial liquidation where there is a cause for liquidation on serious grounds ( pour de justes motifs ). The law of 28 October 2022 created a new procedure for administrative dissolution without liquidation that applies to all commercial companies falling under Arti - cle 1200-1 of the LCC that have no employees and no assets.
A particular type of statutory officer appointed within a bankruptcy is the bankruptcy trustee ( curateur ). Bankruptcy trustees are appointed by the court and, in practice, they are usually selected from a list of attorneys registered with the Bar of Luxembourg and Diekirch. A bankruptcy trustee ( curateur ) oversees the debtor’s estate, ensuring the proper collection, sale and distri - bution of assets to creditors. These professionals work with the debtor’s management to maximise creditor recovery and maintain fairness and transparency. Judicial Administrator In restructuring proceedings, judicial administrators aim to preserve the debtor’s business. Appointed by the court, judicial administrators manage or oversee the debtor’s reorganisation, ensuring the plan benefits creditors and supports business continuity. Supervisory Judge A supervisory judge ( juge délégué ) monitors insol - vency and restructuring proceedings, ensuring com - pliance with procedural requirements. In more com - plex cases, a creditors’ committee, formed with court approval, represents unsecured creditors’ interests and influences decisions. However, Luxembourg law does not provide for creditor committees outside those convened by the supervising judge, and such committees must be self-funded unless otherwise agreed with the debtor. 2. Creditors 2.1 Types of Creditors Creditors under Luxembourg law can be divided as follows. • Creditors of the bankruptcy ( créanciers de la fail- lite ) – these include the costs and expenses of the bankruptcy process itself, such as the fees of the bankruptcy trustee and procedural costs. They have the highest priority in payment. • Preferred creditors of the bankrupt estate –
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