A study by Irina Selevestru, licensed administrator, lawyer, and insolvency expert at CNI Moldinsolv, examines Japan’s example in the field of insolvency through the lens of a major reform adopted by the Japanese Parliament in June 2025: a new framework for preventive restructuring before insolvency, informally known as the Early Business Recovery Act (Law No. 67/2025). Below are the expert’s analysis and conclusions.

A Modern Mechanism for Early Intervention

The new law, expected to enter into force by the end of 2026, introduces a modern mechanism allowing companies in difficulty to intervene before becoming insolvent, restructuring their debts in an organized, fair, and controlled manner. This initiative is not merely a technical adjustment; it reflects a deeper economic philosophy: prevention is more valuable than bankruptcy, and restructuring is a tool for continuity, not a stigma.

Japan’s model is hybrid and sophisticated. It combines:

• Assessment by a neutral organization (technical expertise and objectivity)
• Court validation (legal legitimacy and procedural protection)

A central element is the introduction of the supermajority vote (75%), which allows restructuring plans to move forward without being blocked by isolated opposition. This resolves one of the biggest weaknesses of extrajudicial mechanisms: the requirement of unanimity.

At the same time, the procedure is generally confidential, reducing reputational damage and allowing companies to recover without triggering market panic.

The restructuring plan undergoes rigorous analysis: it must be feasible, fair, and more advantageous than liquidation. The court intervenes only at the end, confirming the legality and sustainability of the solution.

Why This Reform Was Necessary

The economic context made change unavoidable:

• Corporate debt increased by approximately 120 trillion yen after the pandemic
• The number of bankruptcies exceeded 10,000 cases in 2024
• Systemic pressures: inflation, high costs, labor shortages

Japan understood that insolvency can no longer be treated only reactively; it must be managed anticipatively.

Beyond the Law: Economic Culture Makes the Difference

What truly distinguishes the Japanese model is not only the legal architecture but the cultural and educational foundation on which it is built:

• Trust in legal mechanisms
• Acceptance of restructuring as a legitimate tool
• Understanding that business failure is part of the economic cycle, not a fault

This culture enables sophisticated instruments to function effectively. The law is not perceived as an adversary but as a stabilizing tool.

The Situation in the Republic of Moldova

Moldova: Missing the Essential Link – Entrepreneurial Education

In Moldova, the main problem is not necessarily the absence of legal norms, but the lack of adequate economic and legal culture in the field of insolvency.

Three structural deficiencies stand out:

1. Lack of Entrepreneurial Education

Entrepreneurs are not trained to understand:

• Restructuring mechanisms
• The difference between insolvency and bankruptcy
• The role of collective procedures

Without this education, reactions tend to be emotional rather than rational.

2. Acceptance of Disinformation

In the public space, insolvency is often:

• Incorrectly portrayed as “theft” or “abuse”
• Confused with liquidation
• Instrumentalized for pressure

This systemic disinformation generates:

• Distrust in institutions
• Procedural blockages
• Radicalization of creditors and debtors

3. Lack of Societal Training on Managing Failure

In mature economies, business failure is analyzed, managed, and reintegrated into the economic cycle.
In Moldova, failure is stigmatized, politicized, and exploited through pressure and protests.

Yet insolvency cannot be managed through disinformation, pressure, or protests.
It is managed through rules, expertise, and economic discipline.

Conclusion: Japan’s Lesson

Japan shows that modernizing the insolvency framework is not only about adopting new laws, but about building an ecosystem based on trust, competence, and responsibility.

What does this model teach us?

A functional market economy relies on:

• Education
• Accurate information
• Respect for rules

Disinformation inevitably leads to poor entrepreneurial education and disrupts one of the most sensitive areas of the economy: insolvency.

Managing business failure is not achieved through pressure, conflict, or emotional reactions, but through a continuous process of correct education, day by day, forming entrepreneurs capable of understanding, accepting, and responsibly using legal mechanisms.