Insolvency Regulation and Pre-Crisis Alert as Self-Regulation: The Case of Italy

Recently, the European Union issued the “Business Insolvency Directive”, which places emphasis on early warning tools to detect insolvency. Among Member States, Italy was the first to take the opportunity to reform its national insolvency code, introducing a brand-new tool called “alert procedure”. This paper highlights and discusses some of its main features. More precisely, it analyses the role of crisis signals, chosen as early warning tools, and highlights the importance of business planning to timely detect crises. The analysis of Italy has the potential to shed light on how the definition and development of early warning tools can be addressed. It also offers the opportunity to debate how the provision of the new Insolvency Code might spur other countries to adopt similar systems and encourage companies to develop sound controls.