Recent draft-legislation in the European Union may significantly impact investors in distressed European credits. In order to promote investment in the European market, the European Commission issued a proposed directive on November 22, 2016 (COM(2016) 723), which is intended to harmonize the restructuring and insolvency regimes of EU member states by implementing regulations for pre-insolvency proceedings. The proposed legislation is currently being reviewed by the European Parliament and European Council. This review process could take up to two years. If approved, all EU member states would have an additional two years after adoption to bring their legal systems into compliance with the directive.