Directive (EU) 2026/799: changes ahead in insolvency law

Legal Brief by João Mota da Costa

Directive (EU) 2026/799, published on 1 April 2026, establishes common rules on certain aspects of insolvency law, with the aim of improving the functioning of the internal market and reducing differences between national regimes that hinder risk assessment, debt recovery and cross-border transactions.

The Directive enters into force on the twentieth day following its publication, namely on 21 April 2026. However, most of its measures will have to be implemented by the Member States through national legislation by 22 January 2029.

The Directive does not seek to replace national regimes in their entirety. To a large extent, it constitutes minimum harmonisation, allowing Member States to maintain or adopt solutions that are more protective of creditors, provided that the limits established by European law are respected. Its scope is not universal either: certain financial institutions, public entities and individuals who do not carry out a business or professional activity are excluded.

In Portugal, the central question will be to determine in which areas the Portuguese Insolvency and Company Recovery Code (Código da Insolvência e da Recuperação de Empresas — CIRE) already provides equivalent or more demanding solutions, and in which areas legislative amendments will be required.

The following topics are particularly relevant under the Directive:

1. Acts detrimental to creditors

The Directive establishes common categories of acts that may be challenged or subject to avoidance for the benefit of the insolvency estate, namely payments or guarantees granted on preferential terms, gratuitous transactions or transactions carried out for consideration manifestly below market value, and acts performed with the intention of prejudicing creditors.

The CIRE already provides for a broad and demanding regime of avoidance for the benefit of the insolvency estate. Accordingly, implementation should not require the creation of an entirely new regime. It may, however, require a review of the interaction between the time limits and presumptions established in the CIRE and the European categories.

2. Asset tracing and investigation of the debtor’s estate

The Directive significantly strengthens asset-tracing mechanisms. Member States will be required to ensure that competent authorities and, in certain cases, insolvency practitioners have access to information concerning bank accounts, beneficial owners, land registers, vehicles, movable assets, security interests, attachments, intellectual property and other elements relevant to reconstructing the debtor’s estate.

The Directive also provides for the use of interconnection mechanisms between national registers, enabling cross-border access to asset-related information held in other Member States. Insolvency practitioners should be able to obtain sufficient information to identify assets, reconstruct financial flows and detect acts liable to prejudice creditors.

This area may require significant legislative and regulatory intervention in Portugal, particularly regarding the entities authorised to carry out searches, the levels of access and data-protection safeguards. The issue will not merely be to confer new powers on insolvency practitioners, but also to ensure that the various information systems are accessible in a rapid, secure and interoperable manner.

3. Pre-negotiated sale of businesses or assets

The most structurally significant change will be the creation of a pre-negotiated sale regime, or pre-pack. The Directive provides for a two-stage procedure: a preparatory stage, prior to the formal opening of insolvency proceedings, and an implementation stage, which takes place within the insolvency proceedings under the supervision of a court or competent authority.

During the preparatory stage, the debtor may seek interested parties and negotiate the transaction, but an independent supervisor must be appointed to ensure that the process is conducted transparently, competitively and with a view to obtaining the best offer. The selected offer must be justified and will, as a rule, be subject to approval in the insolvency proceedings.

The CIRE contains mechanisms for the liquidation and sale of assets, including the possibility of a direct sale in certain circumstances, but does not provide for an autonomous procedure with this specific configuration. Implementation will therefore have to define the role of the supervisor, the criteria for selecting the best offer, creditor participation and the protection of employees.

The Directive also provides that certain contracts necessary for the operation of the business may be transferred without the counterparty’s consent and that the purchaser will not, as a general rule, assume liabilities arising before the transfer, without prejudice to employment law and competition rules.

4. Duties of directors and timely response to insolvency

The Directive requires company directors to apply for the opening of insolvency proceedings within a maximum period of three months from the moment when they become aware, or should reasonably have become aware, of the company’s insolvency. It also provides for the possibility of civil liability for losses resulting from a failure to comply with that duty.

In this respect, Portuguese law already contains a particularly demanding solution: the debtor must apply for a declaration of insolvency within thirty days of becoming aware of the situation, or of the date on which it should have become aware of it.

The Directive should therefore not necessarily lead to an extension of the period applicable in Portugal. Its impact may instead be felt in the further definition of the criteria for determining knowledge of insolvency, in the liability of directors and in demonstrating that reasonable measures were taken to prevent further losses to creditors.

5. Creditors’ committees

The Directive seeks to strengthen the role of creditors’ committees, providing that they may be established at the initiative of creditors or by decision of the creditors’ meeting whenever their existence is appropriate in light of the size and complexity of the proceedings. Their composition should reflect, as far as possible, the diversity of the interests involved, including employees and cross-border creditors.

The CIRE already provides for a creditors’ committee, normally composed of three or five members, with supervisory and co-operative functions in relation to the insolvency practitioner. Portuguese implementation may therefore focus on rules concerning its operation, the circulation of information, electronic participation, the prevention of conflicts of interest and the possibility of assigning additional powers in relevant matters, such as the sale of assets.

6. Comparable information on national regimes

The Directive provides for the preparation of a common information sheet covering the main features of insolvency proceedings: the requirements for opening proceedings, the filing and verification of claims, ranking, distribution of the liquidation proceeds and the average duration of proceedings. This information must be made available in accessible language, updated where necessary and published through the European e-Justice Portal.

Although apparently simple, this measure is relevant for foreign creditors and investors, who will be able to compare more easily the risks associated with different national regimes.

In conclusion, the transposition of the Directive will require significant amendments to the CIRE, particularly in relation to pre-negotiated sales, access to asset-related information and the further definition of directors’ liability. In the remaining areas, any amendments that may be required should be capable of being incorporated and systematised with relative ease.

It will be essential to strike a balance between speed and transparency, preservation of the value of the business and equality among creditors, without losing sight of employee protection and the specific features of the Portuguese insolvency regime.