Preventive Restructuring in 2026: Three Problems in Ukrainian Court Practice

Preventive restructuring is gradually moving from being a novel mechanism in Ukrainian law to becoming a fully fledged area of litigation. During the first year after the introduction of this instrument, most attention was focused on how to initiate the procedure and prepare a restructuring plan. Court practice in 2026, however, shows a much more complex picture.

Courts are now being asked to assess the credibility of debtors’ financial forecasts, verify creditor classes and claims, determine the permissible scope of protection against enforcement, and, once a plan has been approved, decide how existing enforcement proceedings should be treated.

At the same time, there is still no settled Supreme Court case law on the key issues. In June 2026, the Supreme Court itself described the practice surrounding the new mechanism as still developing. For the time being, therefore, the decisions of commercial courts and commercial courts of appeal provide the clearest indication of where the first major problems in preventive restructuring are emerging.

It is no longer enough to simply call a plan viable

One of the clearest trends in 2026 is the gradual tightening of judicial expectations regarding the economic justification of a restructuring plan.

This can be seen by comparing two cases: PJSC Dnipro Metallurgical Plant, case No. 904/5450/25, and LLC EUROENERGOTRADE, case No. 905/39/26.

In the Dnipro Metallurgical Plant case, the court approved the plan on 27 January 2026. It covered the claims of 92 affected creditors amounting to approximately UAH 1.31 billion. The plan provided for a two-year deferral followed by repayment of the debt. Its viability was supported by projected cost optimisation, improved energy efficiency, greater utilisation of production capacity, concentration on profitable business lines and the possible sale of non-core assets.

The court accepted that model, and in April the Central Commercial Court of Appeal upheld the approval of the plan.

The EUROENERGOTRADE case developed very differently. There, creditors effectively began scrutinising the debtor’s financial model in much the same way as an investor would examine a business before committing capital.

Ukrgasbank submitted the findings of a panel forensic economic examination. Creditors referred to the revocation of the debtor’s licences for electricity and natural gas supply, the financial condition of its principal debtors and pending litigation involving them.

One of the main sources of future plan funding was a substantial receivable owed by LLC KHIM-TRADE, whose own financial condition also raised concerns. As a result, the subject of judicial review is no longer confined to the debtor’s own financial position. If performance of the plan depends on collecting several billion hryvnias from a particular counterparty, creditors can legitimately ask whether that counterparty is actually capable of paying.

This substantially changes the way restructuring plans must be prepared. A cash-flow forecast can no longer be built merely on the formal existence of receivables or an anticipated asset sale. The actual prospects of recovery, timing, the debtor’s financial condition, pending litigation, asset liquidity and alternative scenarios all need to be assessed.

The same trend is visible in relation to creditor claims. In the EUROENERGOTRADE case, one creditor challenged both the amount and the origin of other creditors’ claims. The court ordered the production of documents concerning the chain of assignment, assignment and factoring agreements, notices and proof of payment.

This is a fundamental issue. An error in the amount of a creditor claim in preventive restructuring is not merely an accounting problem. It may affect voting power and, ultimately, the outcome of the vote on the plan. Court practice is therefore gradually developing a standard under which the financial model, creditor structure and even the chain of title to individual claims must be capable of withstanding full evidentiary scrutiny.

Six months of protection: an absolute cap or a period that can be restarted?

The second problem has already produced approaches that are difficult to reconcile completely. In the case of PJSC Cherkasy Khimvolokno, case No. 925/1544/25, the debtor sought an extension of additional protective measures specifically against one creditor, LLC Naftogaz Trading. The creditor objected, including on the ground that the restriction was selective. The Commercial Court of Cherkasy Region, however, held that the Bankruptcy Procedures Code expressly permits protective measures against an individual creditor or a class of creditors. In other words, a selective stay is not, in itself, inconsistent with the nature of preventive restructuring.

At the same time, the court articulated another important rule: the total duration of protective measures may not exceed six months from the date the procedure is opened.

Once that period expires, the measures terminate automatically and the court cannot extend them.

At first glance, that appears to provide a clear rule. The case of LLC Euro-Reconstruction, case No. 910/10713/25, however, complicated the picture. The procedure was opened on 8 September 2025, while, as the court itself noted, the previously imposed additional protective measures expired on 8 March 2026.

Nevertheless, on 10 June the Commercial Court of Kyiv again imposed additional protective measures, prohibiting several creditors and enforcement officers from pursuing compulsory enforcement.

The practice has therefore raised a question that still requires an authoritative answer under the Bankruptcy Procedures Code: is six months the absolute cumulative limit for protection within one preventive restructuring procedure, or may new measures be imposed after the previous ones have expired in certain circumstances?

Until an appellate or cassation court provides a clear answer, debtors should be cautious about relying on the possibility of “restarting” protection. For creditors, meanwhile, protective measures imposed after the six-month period may provide one of the strongest grounds for challenging the relevant court order. It is also significant that courts have begun to distinguish between the issue of protection and the substantive assessment of the restructuring plan itself. In the Cherkasy Khimvolokno case, objections concerning the plan’s economic model were essentially left for the plan approval stage. This means that it is not enough for a creditor simply to argue that the proposed restructuring is unsound. To challenge protective measures, the creditor must instead demonstrate that the restriction is unnecessary, disproportionate, or insufficiently connected to a genuine risk that enforcement would undermine the restructuring.

The plan has been approved. What happens to enforcement proceedings?

The third problem arises after the debtor has formally achieved its main objective: court approval of the restructuring plan. A particularly instructive example is the case of PJSC Kharkiv Tractor Plant, case No. 922/2471/25.

The Kharkiv Tractor Plant plan was approved on 17 December 2025 and provided for restructuring until March 2029: a three-year deferral followed by repayment of the relevant claims. However, part of the debt was already subject to compulsory enforcement.

In 2026, the company applied to the court seeking suspension of enforcement actions under writ of execution No. 820/5225/15, in which the claimant was the Office of Large Taxpayers of the State Tax Service. This created a conflict between two legal realities. On the one hand, there was an existing enforceable instrument. On the other, there was a subsequently court-approved restructuring plan that altered the timing of performance of the relevant obligation.

The court proceeded on the basis that, once the plan was approved, the terms governing performance of the obligation had changed. Continuing compulsory enforcement on the previous terms would therefore be inconsistent with the restructuring.

For creditors, the position is the reverse. If a claim is already at the enforcement stage, the key battle over its treatment may take place not after the plan has been approved, but much earlier — during the formation of creditor classes, determination of claim amounts, voting and judicial review of the plan.

Court practice is only beginning to reveal the true complexity of the procedure

The 2026 cases demonstrate an important transformation in preventive restructuring. The debate is gradually moving away from the general question of whether a debtor can be rescued before insolvency and towards much more practical conflicts: who is entitled to vote and with how many votes, whether the sources of plan funding are credible, how long enforcement may be stayed, and what happens to existing enforcement instruments once new repayment terms have been approved.

There is still no cassation-level authority capable of harmonising these approaches. The case law is developing in real time, and some first-instance decisions already reveal potential inconsistencies.

For that reason, the success of preventive restructuring today depends on much more than negotiations with creditors. A plan should be prepared with future litigation in mind: supported by a defensible financial model, a verified structure of claims, properly constituted creditor classes and a clear understanding of how its provisions will operate not only at the negotiating table, but also in enforcement proceedings.

These issues are likely to shape the next stage of Ukrainian preventive restructuring practice.