A3 Refereed book chapter or chapter in a compilation book
Executory contracts in insolvency: The Finnish perspective
Authors: Tuomisto Jarmo
Editors: Jason Chuah, Eugenio Vaccari
Edition: Second Edition
Publisher: Edward Elgar Publishing Ltd.
Publication year: 2023
Book title : Executory Contracts in Insolvency Law: A Global Guide
First page : 179
Last page: 193
ISBN: 978-1-80392-341-3
eISBN: 978-1-80392-342-0
DOI: https://doi.org/10.4337/9781803923420.00020(external)
Web address : https://www.elgaronline.com/edcollchap/book/9781803923420/book-part-9781803923420-20.xml(external)
The bankruptcy estate has, according to the Bankruptcy Act, a general power to continue contracts entered, but not fully performed, by the debtor before the bankruptcy proceedings. The debtor may, however, terminate the contract if it is of a personal nature or there is some other special reason why it cannot be required that the other party would perform the contract with the bankruptcy estate. There are also various special provisions which, in variable degree, modify the general rule of the Bankruptcy Act. The general rule in restructuring proceedings is that only the debts of the company in economic distress are adjusted in order to help the company out of its problems. Other kinds of obligation stay, as a rule, unchanged. According to the Restructuring of Enterprises Act, a commitment of the debtor, according to which a creditor or other contracting party of the debtor is entitled to terminate or to rescind a contract or unilaterally change the terms of a contract solely by reason of a request for the opening of restructuring proceedings or by reason of actually opening of such proceedings is invalid. A similar rule is supposed to apply to the bankruptcy proceedings.