A creditors’ composition agreement has been approved for Pescanova, and section six of the insolvency proceedings (categorisation of the insolvency) has not been opened, as there is a type of creditor whose moratorium is less than three years and whose debt relief is below one third.
The composition proposal of Pescanova, S.A. has been approved with the vote in favour of 63.65% of the liabilities calculable for these purposes. Thus, as the judgment of Pontevedra Commercial Court No. 1 of May 23, 2014, legally approved the composition agreement, all effects of the declaration of insolvency are removed and replaced by those in the agreement, and the insolvency administration is concluded.
The judgment stated that was no reason to open section six (categorisation) of the insolvency proceedings, notwithstanding it should be open if the composition agreement is not fulfilled. The judge considered that the amended composition proposal (the one definitively approved) raises the amount of the claims treated individually, i.e., with no debt relief and with a moratorium of one year, to €100,000, involving 336 creditors out of 500, compared to the initial proposal’s provisions, which only did so for creditors with claims of less than €1,000. Therefore, the judge considered that (without analyzing the raison d`être or material fairness of this precept, as this did not correspond to him) article 167.1 of the Insolvency Act was fully applicable, which states that section six will not be opened on agreeing for one type of creditor debt relief of less than a third or a moratorium of less than three years, unless there is a breach of the agreement.