Hungary is currently drafting new insolvency legislation. At present, there is no law in Hungary that governs restructuring and reorganisation, as the legislation only extends to the formal procedures of liquidations, bankruptcy and voluntary dissolutions. Debt restructurings have, to date, only been made on a voluntary contractual basis, where the financing banks and the debtor have typically put in place a standstill agreement and subsequently agreed a restructuring plan, which, when successfully carried out, helped the borrower to restructure and continue its business.
It has now been decided in principle that the insolvency law should also include new reorganisation and restructuring procedures.
