Post-IRCJ challenges: changing Japanese culture to enable early revitalization of troubled corporations

Takagi, A 2005, 'Post-IRCJ challenges: changing Japanese culture to enable early revitalization of troubled corporations', International insolvency review, vol. 14, no. 2, pp. 111-119.


Document type: Journal Article
Collection: Journal Articles

Title Post-IRCJ challenges: changing Japanese culture to enable early revitalization of troubled corporations
Author(s) Takagi, A
Year 2005
Journal name International insolvency review
Volume number 14
Issue number 2
Start page 111
End page 119
Total pages 9
Publisher John Wiley & Sons Ltd.
Abstract The Industrial Revitalization Corporation of Japan (IRCJ) was created in 2003 to restructure distressed debtor corporations with excessive debts before their bankruptcy with a view to deterring ever-increasing non- and poor-performing loans. The IRCJ successfully reorganized target debtor companies through the out-of-court workout with multiple financial institutions where unanimous consent of financial creditors is required. Since the lifetime of the IRCJ is limited, the IRCJ cannot rescue troubled corporations after the end of March 2005. From then onward, the out-of-court workout should be utilized more widely in Japan in order to revitalize distressed businesses at an early stage without impairing the rights of trade creditors and deteriorating the value of the businesses. To make the workout most effective, it is important to ensure that the statutory reorganization The Industrial Revitalization Corporation of Japan (IRCJ) was created in 2003 to restructure distressed debtor corporations with excessive debts before their bankruptcy with a view to deterring ever-increasing non- and poor-performing loans. The IRCJ successfully reorganized target debtor companies through the out-of-court workout with multiple financial institutions where unanimous consent of financial creditors is required. Since the lifetime of the IRCJ is limited, the IRCJ cannot rescue troubled corporations after the end of March 2005. From then onward, the out-of-court workout should be utilized more widely in Japan in order to revitalize distressed businesses at an early stage without impairing the rights of trade creditors and deteriorating the value of the businesses. To make the workout most effective, it is important to ensure that the statutory reorganization procedures, including the majority rule, are applied more flexibly and reliably
DOI - identifier 10.1002/iir.128
Copyright notice Copyright © 2009 John Wiley & Sons, Ltd.
ISSN 1180-0518
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