Liquidity Decree - 10 proposals for reforming the insolvency system to deal with the COVID-19 emergency

In view of the process of converting Decree Law No. 23 of April 8, 2020 (Liquidity Decree) into law, Stefano Morri, lawyer, and the Morri Rossetti business crisis study group analyzed, in the light of the needs posed by the Covid-19 crisis, the regulatory framework of insolvency (contained in the R.D. March 16, 1942, No. 267, but not only) and elaborated a set of proposals for its improvement with a view to tackling a possible "insolvency pandemic", whose effect, if not governed, could be the decimation of Italian companies, with serious repercussions on income production and employment.

The legislator has already shown sensitivity to one aspect of the policies for reacting to the crisis, issuing some measures under the Liquidity Decree, which are welcomed but at the same time caught in their insufficiency and fragmentation.

The document, although without the pretension of upsetting established structures, attempts a minimal but at the same time organic intervention with the aim of favouring, streamlining and speeding up the agreed procedures for regulating the crisis, in particular the composition with creditors, and making the relationship with tax and contributory creditors certain and predictable, to encourage the raising of insolvency finance - also in the form of relations with strategic suppliers - to improve insolvency taxation, to reassure financial operators, called upon to provide liquidity in borderline situations and to stimulate the emergence of a credit and equity market.

The Study Group, aware of the decisive importance of the issue and at the same time of the inevitable possibility of perfecting the proposals it has developed, is open to discussion and comparison with anyone who is motivated by the intention of fostering the preservation of the value of the Italian industrial system and wants to put his knowledge and experience at the service of this high task.

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