{"title":"Company Purpose in the Context of Business Sustainability and Insolvency Proceedings","authors":"Tu Linna","doi":"10.54648/eucl2021021","DOIUrl":null,"url":null,"abstract":"The organizational and operational company purposes of the debtor company terminate in liquidation proceedings. In addition, the nonfinancial sustainability elements vanish in a piecemeal selling. Through a selling as a going concern, the operational company purpose and sustainability elements may be transferred to a byer company. In restructuring proceedings, both the organizational and operational company purposes remain, but the shareholder primacy shifts to a creditor priority. When choosing between liquidation and restructuring proceedings, there are two tests: the viability test and the best-interests-of-creditors test. In these tests, all obligatory non-financial sustainability elements, such as environmental requirements laid down in the law, must be considered. Voluntary non-financial sustainability investments for implementing the company operational purpose are allowed also during the restructuring plan if they benefit the creditors.","PeriodicalId":11843,"journal":{"name":"European Company Law","volume":null,"pages":null},"PeriodicalIF":0.5000,"publicationDate":"2021-09-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":"0","resultStr":null,"platform":"Semanticscholar","paperid":null,"PeriodicalName":"European Company Law","FirstCategoryId":"1085","ListUrlMain":"https://doi.org/10.54648/eucl2021021","RegionNum":0,"RegionCategory":null,"ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":null,"EPubDate":"","PubModel":"","JCR":"Q3","JCRName":"LAW","Score":null,"Total":0}
引用次数: 0
Abstract
The organizational and operational company purposes of the debtor company terminate in liquidation proceedings. In addition, the nonfinancial sustainability elements vanish in a piecemeal selling. Through a selling as a going concern, the operational company purpose and sustainability elements may be transferred to a byer company. In restructuring proceedings, both the organizational and operational company purposes remain, but the shareholder primacy shifts to a creditor priority. When choosing between liquidation and restructuring proceedings, there are two tests: the viability test and the best-interests-of-creditors test. In these tests, all obligatory non-financial sustainability elements, such as environmental requirements laid down in the law, must be considered. Voluntary non-financial sustainability investments for implementing the company operational purpose are allowed also during the restructuring plan if they benefit the creditors.