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Leiden insolvency thesis wins annual BUREN thesis prize

On 23 November 2022, the BUREN Thesis Prize on Insolvency Law was awarded for the fifth time. This year, two Leiden theses were nominated for this prize, written by Carlijn van der Hek and Raghav Mittal. Both nominees presented the results of their research, after which the jury announced that the first prize was awarded to Carlijn.

All theses submitted for the BUREN Thesis Prize on Insolvency Law were reviewed by a jury, consisting of Dr. Erik de Kloe, academic lecturer at the Erasmus University Rotterdam, Prof. Harold Koster, professor of Company Law at the Leiden University and Mr Maarten Vermeeren, attorney-at-law and partner in restructuring and insolvency at BUREN. The other nominees included Zafar Sahikhi (who received an honourable mention), Esra Beelen and Miriam Nijhuis. The Leiden theses were supervised by Gert-Jan Boon and Reinout Vriesendorp.

Role of the supervisory judge in signaling bankruptcy fraud

In her thesis, written for the completion of the master of Company Law, Carlijn van der Hek discusses how bankruptcy fraud can be better detected and addressed. In practice, the task given by the Dutch legislator to insolvency practitioners to review the debtor’s conduct is not always considered useful. Carlijn conducts an interesting study on which role the supervisory judge has to play in this regard to signal and report possible bankruptcy fraud.

The jury report states: ‘The research conducted by Carlijn is not only useful, but also an enjoyable read. This is partially due to the versatility of the thesis. It includes a literature review, qualitative research on the scope and forms of bankruptcy fraud, as well as qualitative research on challenges faced by supervisory judges in signaling bankruptcy fraud.

Equity retention in SME restructuring: comparing Dutch and US approaches

Raghav Mittal – who wrote his thesis as a part of  the advanced master International Civil and Commercial Law (ICCL) in Leiden – reviews in detail how value can be retained by equity holders in SME restructuring proceedings. His thesis written in English is titled: ‘Prioritizing SME Debtor’s Equity Retention: Espousing Relativity over Fairness and Equitability? Comparing Relative Priority Rule with the Fair and Equitable Test’.

In his master thesis, Raghav reviews the possibilities offered by the European Preventive Restructuring Directive (2019/1023) and the US Small Business Reorganization, which is a part of the US Chapter 11 Bankruptcy Code (reorganization). He compares which of these frameworks offers the best option for maintaining value by equity holders. More specifically, presuming that there are justifiable grounds to do so, Raghav reviewed what the possibilities are under the so-called ‘relative priority rule’ of the Preventive Restructuring Directive and the ‘fair and equitable test’ of Chapter 11.

The theses of Carlijn and Raghav are available here.

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