At present, insolvency-related proceedings are regulated by the Civil and Commercial Procedural Code. This legislation has been in force for approximately 60 years and its application is currently scarce.
The draft Insolvency Law was approved by the Congress of the Republic and is pending sanction (or veto), enactment and publication by the Executive. According to the opinion of the Commission of Economy and Foreign Trade of the Congress of the Republic, one of the main objectives of the law is to promote the reorganization of the debtor in order to keep the company in operation. Likewise, it seeks to create a simple and agile insolvency proceeding through which creditors must seek payment of their credits.
The most important aspects to understand the Insolvency Law are described below.