The last major revision to U.S. business reorganization laws occurred in 1978. Since then, companies’ capital structures have become more complex and rely more heavily on leverage, including secured debt in particular; their asset values are driven less by hard assets and more by services, contracts, intellectual property and other intangible assets; and their business structures and models increasingly are multinational. Moreover, there has been a growing perception that troubled companies are not using Chapter 11, or are waiting too long to use it, thereby undercutting its utility for stakeholders. This perception, in turn, is based on a growing view that Chapter 11 does not work efficiently for many debtors and is prohibitively expensive.

Accordingly, the American Bankruptcy Institute (ABI) established the Commission to Study the Reform of Chapter 11 (the Commission) to comprehensively evaluate U.S. business reorganization laws. The Commission is comprised of 18 Commissioners and four ex officio members, who are among the most prominent Chapter 11 professionals in the United States. They are supported by more than 200 other professionals who served on 13 topical advisory committees. The Commissioners held 17 field hearings to gather testimony while also considering hundreds of other written submissions. The process included perspectives and significant input from representatives of all major stakeholders in Chapter 11 cases.

The culmination of the Commission’s work is its Final Report and Recommendation, released on December 8, 2014 (the Report)...