The amendment, effective as of 23 August 2025, brings Polish restructuring law closer to EU standards. The implementation of the Directive on preventive restructuring frameworks, also known as the Second Chance Directive, has introduced measures to make restructuring procedures more effective and enhance creditor protection.
The changes include new mechanisms aimed at facilitating the rescue of entities in distress. The act introduces new rules for confirming arrangements (the cross-class cram-down mechanism), the obligation to prepare a creditor satisfaction test, as well as other solutions important to both debtors and creditors.
Cross-class cram-down
This is a mechanism that enables an arrangement to be adopted despite opposition from some creditors.
Following the amendment to the law, if an arrangement is not approved by every class of creditor, the court may declare it adopted if:
- the majority of creditor classes voted in favour of the arrangement;
- at least one of the approving classes consists of secured creditors or creditors classified as ranking higher than satisfaction category II (in accordance with the rules laid down in the Bankruptcy Law;
- creditors holding at least half of the value of the voting claims (capital threshold limit) have voted in favour of the arrangement.
If the above conditions are not met, an alternative form of approval of the arrangement may be:
- a vote in favour of the arrangement by at least one class of creditor who would receive partial satisfaction if the business of the debtor in bankruptcy continued as a going concern;
- a vote in favour of the arrangement by creditors holding at least half of the value of the voting claims (capital threshold limit).
Creditor satisfaction test
The creditor satisfaction test will make it easier for creditors to decide how to vote and assess the profitability of accepting an arrangement under the debtor’s restructuring plan.
The test will compare the satisfaction of the creditor in the proposed arrangement with their situation in bankruptcy proceedings.
The legislature proposes indicating three valuation options in the test, concerning:
- implementation of the restructuring plan,
- sale of the enterprise in bankruptcy proceedings,
- sale of individual assets of the enterprise.
The satisfaction test will also verify whether the best-interest-of-creditors test has been satisfied and whether the cram-down mechanism has been applied.
Situation of secured creditors
Regardless of whether the creditor consents, claims secured by a mortgage, pledge, registered pledge, tax lien or maritime mortgage are covered unconditionally by the arrangement.
The amendment also guarantees that secured creditors will receive at least the same level of satisfaction as they would in bankruptcy proceedings or under the agreement establishing the security.
Standardisation of the duration of the procedure
The legislature has also removed inconsistencies between the announcement of the arrangement date and the duration of the procedure for confirmation of the arrangement and the submission of the application for confirmation of the arrangement.
The proposed amendment limits the setting of the arrangement date and also modifies the timeframe for submitting applications for confirmation of arrangements, setting it at four months from the date of the announcement of the arrangement date.
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