Robert J. Keach, of Bernstein, Shur, Sawyer & Nelson and co-chair of the American Bankruptcy Institute’s Commission to Study the Reform of Chapter 11, praised the introduction of bipartisan legislation to provide a viable option for small and medium-sized enterprises looking to reorganize under the Bankruptcy Code.
“The introduction of this bill is a key first step on the path to helping financially troubled SMEs who may simply avoid chapter 11 altogether,” Keach said. “We applaud the recognition of the need for SME reform and look forward to working with Congressional leaders and stakeholders to achieve these and other necessary fixes to the Code to help struggling small businesses.”
The “Small Business Reorganization Act of 2018” introduced yesterday by Senate Judiciary Chairman Charles Grassley (R-Iowa) and Sen. Sheldon Whitehouse (D-R.I.) is based on some of the Commission’s proposed reforms to reinstate reorganization under the Bankruptcy Code as a viable option for SMEs.
“The bill is a necessary vehicle for a serious discussion about needed reform and the Commission’s proposals,” Keach noted.
The legislation also incorporates important preference reform recommended by the Commission.
“The preference provisions, if adopted, would address abuses that all segments of the insolvency community agree need to be addressed,” said Keach.
Keach testified before the Senate Judiciary Subcommittee on Oversight, Agency Action, Federal Rights and Federal Courts in March, proposing reforms to reinstate reorganization under the Bankruptcy Code as a viable option for SMEs.
