Insolvency 2025

LUXEMBOURG Law and Practice Contributed by: Laure-Hélène Gaicio Fievez, Fabio Trevisan and Carolina Vasselli, BSP

6.4 Recognition and Enforceability In accordance with the EU Insolvency Regulation (Recast) (which replaces and recasts the previous EU Regulation 1346/2000 of 20 May 2000), insol - vency proceedings opened in one member state are automatically recognised in all other member states, including Luxembourg, provided the debtor’s COMI is located within the EU. This automatic recognition streamlines cross-border insolvency management within the EU. For insolvency proceedings originating outside the EU, the situation is different. Luxembourg case law provides that a non-EU insolvency judgment can have universal effect in Luxembourg, but only under certain conditions. Specifically, such judgments must first be recognised through exequatur proceedings in Lux - embourg to enforce any measures relating to assets located in Luxembourg. This process involves: • verifying jurisdiction – ensuring the foreign court had jurisdiction according to Luxembourg’s conflict of jurisdiction rules; • defending procedural rights – confirming that the rights of defence of the debtor or other parties involved were respected; • respecting public policy – ensuring that recognition does not contravene Luxembourg’s international public policy ( ordre public ); and • preventing legal circumvention – confirming that Luxembourg law has not been circumvented (known as fraude à la loi ). Recognition of UK Insolvency Proceedings Post- Brexit Since the United Kingdom’s withdrawal from the EU, English insolvency proceedings are no longer subject to the automatic recognition granted under the EU Insolvency Regulation (Recast). Instead, they are treated as judgments from a third country. Con - sequently, English insolvency judgments seeking to enforce measures in Luxembourg now require the exequatur procedure, similar to any non-EU insol - vency judgment. 6.5 Co-Ordination in Cross-Border Cases Within the EU, the courts operate under the EU Insol - vency Regulation (Recast), which aims to facilitate

Regulation (Recast), particularly regarding cross-bor - der insolvency proceedings within the EU. 6.2 Jurisdiction As a member of the EU, Luxembourg applies EU regulations that influence domestic law. Thus, the EU Insolvency Regulation (Recast) provides a uniform framework for determining the jurisdiction and appli - cable law for insolvency proceedings within the EU, as outlined below. • Main proceedings – governed by the law of the jurisdiction where the centre of main interests (COMI) is located (eg, Luxembourg if the COMI is established there). For companies, this is generally their registered office. • Secondary proceedings – these can be initiated in another member state where the debtor has an establishment. Luxembourg law will apply to assets located within Luxembourg in such cases. 6.3 Applicable Law Under Luxembourg law, insolvency and restructuring proceedings are generally governed by the territorial - ity principle. This means that Luxembourg law applies to insolvency proceedings initiated in Luxembourg courts, provided that the debtor has sufficient ties to Luxembourg. As explained, the primary connecting factor is the debtor’s centre of main interests (COMI), a concept derived from EU law (eg, the EU Insolvency Regulation (Recast)). The criteria for the COMI in Luxembourg are as fol - lows: • registered office – the debtor’s registered office is presumed to be its COMI unless proven otherwise; • principal place of business – if the debtor conducts the majority of its operations in Luxembourg, this can establish Luxembourg as the COMI; and • stakeholder engagement – where creditors, employees and other stakeholders predominantly interact with the debtor in Luxembourg, this further supports Luxembourg jurisdiction. When the COMI is established in Luxembourg, its laws typically govern both procedural and substantive aspects of restructuring or insolvency proceedings.

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