Prepared by Cristian Sgaramella, Michele Giuliani and Carolina Notario
Once again, with the recent Ordinance No. 10356 of 20 April 2021, the Joined Sections ruled the cross-border insolvency, in particular facing the jurisdiction matter.
The decision of the Supreme Court arose from the appeal against the judgment of the Court of Appeal of Rome, pursuant to Article 18, Bankruptcy Law.
More specifically, according to the plaintiff’s defense, by virtue of the principles of Regulation (CE) No 1346/2000, the Court of Appeal would be wrong in determining the Italian jurisdiction in relation to the bankruptcy proceedings since the company, went bankrupt, had (i) established its registered office in London and, at the same time, (ii) ceased any kind of activity in Italy, also cancelling itself from the Register Office.
The raised objections gave to the Supreme Court the opportunity to resume the European principles and, above all, their practical implementation.
Firstly, the case was brought back to the correct referring legal framework, Regulation (EU) No 848/2015, as it is applicable to all insolvency proceedings opened as of 26 June 2017.
This clarification is particularly worth in relation to the delimitation of jurisdiction by the criteria established by the European legislation under Article 3 of the EU Regulation.
More in details, the prevision mentioned above, adopting the previous regulation, sets up the jurisdiction to open the main insolvency proceedings before the courts of the Member State where the “debtor’s main interest center” (COMI) is situated, and also confirms the presumption of coincidence between COMI and Registered Office.
In this regard, the Supreme Court highlights the significant changes brought by the rule recently come into force, where it introduces the definition of COMI, considered as “the place where the debtor exercises the management of its interests in a usual way and (above all) recognizable by third parties” and limits the presumption applicability only in those cases where the request for opening of insolvency proceedings is made three months (suspect period) after transferring the registered office to another Member State.
Having outlined the legal framework, the Joined Sections, motivating the decision, went beyond the literal application of the subject legislation, stating that this presumption does not constitute a dogmatic criteria and that it can be overcome by giving evidence of the fictitious transfer of the registered office.
According to the Italian Supreme Court, the COMI shall be identified by means of pragmatic evaluations and throughout a solid assessment of the current location of the company’s management, administrative and organizational activities, thus going beyond official indications.
Eventually, the Joined Sections conclude that it is “useless insisting on the cancellation of the company from the Companies’ Registry ” since, for the purposes of ascertaining the fictitious transfer of the registered office, there is no need for a prior pronouncement of the judge of the register formally restoring, the effective reality.
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