THE DIRECTIVE ON THE HARMONISATION OF CERTAIN ASPECTS OF INSOLVENCY LAW

TOWARDS A MORE ATTRACTIVE EU CAPITAL MARKET

Abstract

The European Union has recognised that the that divergences in insolvency proceedings among Member States represent a significant barrier to the further development of the EU Capital Market. Therefore, on 21st April 2026, the Directive on harmonisation of certain aspects of insolvency law (hereinafter: Directive) entered into force. The Directive aims to introduce minimum harmonisation standards for certain aspects of insolvency law to encourage crossborder investments within the EU market and to ensure greater legal certainty, comparability, and transparency across Europe’s insolvency regimes. The EU covered 6 key areas of harmonisation: avoidance actions in insolvency proceedings, tracing assets, the pre-pack proceeding, directors’ duty, creditors’ committee, simplified winding-up proceedings for microenterprises and measures enhancing transparency of national insolvency laws. The deadline for transposing the Directive into national law is 22 January 2029, or 10 July 2029 for the introduction of the BARIS banking account system. Although all of the aforementioned represent very ambitious goals for the European legislator with significant potential, this paper aims to provide a preliminary assessment of the directive’s final text. This paper focuses on a critical analysis of the provisions of the Directive relating to avoidance actions in insolvency proceedings, pre-pack proceedings, directors’ duties, the creditors’ committee. These provisions are critically compared with the existing provisions of the Croatian Insolvency Act to provide de lege ferenda guidelines to the Croatian legislator for the transposition of the Directive into the domestic legal system. Finally, the paper also analyses potential issues in transposing the Directive into the Croatian legal system, which could result in a paradoxical effect, primarily reduced legal certainty and difficulty in applying the Directive’s established objectives in practice.