As of 15 July 2022, the Codice della Crisi d’Impresa e dell’Insolvenza (Legislative Decree No. 14/2019) came into force.
Among the new features of the discipline, we would like to point out the following:
Negotiated crisis resolution (Composizione negoziata della crisi)
The alert procedure initially envisaged has been definitively set aside, but the duties of punctual activation of crisis-combating instruments, first and foremost the negotiated resolution, which becomes a primary instrument through which to intervene to tackle the state of crisis, are not affected. The entrepreneur may apply to the relevant Chamber of Commerce for the appointment of an independent expert when it appears reasonably feasible to reorganise the company.
This instrument, applicable as from 15 November 2021, can be activated at the request of the entrepreneur, whether commercial or agricultural, with no size limitation in relation to its usability..
The financial intermediaries (banks, assignees of bank loans, etc.) are invited to participate actively in the negotiations ‘in an active and informed manner’. Access to the negotiated resolution does not, in itself, constitute a cause for suspension or revocation of credit lines, which may only be ordered if required by prudential supervisory regulations with a specific notice outlining the reasons.
Furthermore, creditors for whom the protective measures operate (Art. 18) may not unilaterally refuse to perform or cause the termination of pending contracts, nor may they anticipate their expiration or modify them to the detriment of the entrepreneur solely on the ground of non-payment of claims that pre-date the publication of the application for access to the negotiated resolution.
Organisational, administrative and accounting structures.
The duty of the individual and collective entrepreneur to establish an organisational, administrative and accounting structure appropriate to the nature and size of the business is contained in the recently amended Article 2086 of the Civil Code. These measures, according to the new Crisis Code, must make it possible to:
- detect any imbalances of a financial or economic-financial nature, related to the specific characteristics of the company and the business activity carried out by the debtor;
- verify the non-sustainability of the debts and the absence of any prospect of the company being able to continue as a business for the following twelve months and the warning signs (existence of payroll debts overdue for at least thirty days amounting to more than half of the total monthly payroll amount, existence of payables to suppliers overdue for at least ninety days amounting to more than the amount of the debts not overdue, existence of exposures to banks and other financial intermediaries which have been overdue for more than sixty days or which have exceeded the limit of credit facilities obtained in any form for at least sixty days provided that they represent a total of at least five per cent of the total exposures, existence of one or more of the debt exposures provided for in Article. 25-novies, first paragraph, to public creditors such as INPS, INAIL, Agenzia delle Entrate and Agente della riscossione);
- derive the information necessary to follow the detailed checklist and to carry out the practical test for the verification of the reasonable feasibility of reorganisation (i.e. through the Negotiated crises resolution).
The company organisation includes the following aspects:
- identifying the skills available, positioning them where they can be most useful;
- the adoption of appropriate production processes and technologies aimed at business efficiency;
- the development of an integrated system of human resources, know-how and technology.
In order to protect its assets, the company administration must focus on the following essential aspects:
- the contractual relationship with customers and suppliers;
- payment methods;
- investments;
- relations with tax offices;
- the correct payment of taxes.
Asking the entrepreneur to adopt a preventive approach to business crisis management therefore makes the role of planning tools such as the business plan and budgeteven more central.
Since companyaccountsmust act as an X-ray of the company’s state of health, they must be updated not so much because of a legislative obligation, but because they become an essential tool for assessing what action to take to ensure the best organisational and administrative level.
