Carey
June 6, 2014 - Chile
New Chilean Insolvency Act
by Ricardo Reveco, Partner
In october of 2014, Law No. 20,720 will enter into effect. This act replaces the current bankruptcy law, and creates a new reorganization and liquidation regime for both corporations and natural persons. The main purpose of this new act (a) to ease the negotiation and approval of the debtor's reorganization agreement; (b) to improve the creditors' recovery rate in insolvency procedures, creating a more effective and efficient procedure; and (c) to regulate the effects of cross-border insolvency procedures.
Main Innovations
1. Insolvency Financial Protection in Case of Reorganization Agreements
2. Secured Creditors and Reorganization Agreements
3. Revocatory Actions
4. Voting Rights and Quorum
5. Cross-Border Provisions
6. Specialized Courts and New Insolvency Authorities
Footnotes: