WEALTH June 20, 2026 0 Comments

Why Ireland’s Hidden Rescue Tools Are Sitting Idle—And What It Means for Your Business Survival Right Now

Ever wonder why so many Irish firms seem to throw in the towel without even trying to fight for their survival? It’s puzzling, right? Especially when options like examinership and the Small Company Administrative Rescue Process (Scarp) are sitting there, seriously underused, yet brimming with potential to rescue viable businesses from the brink. Picture this: out of over 800 insolvencies last year, just 43 companies actually attempted these rescue channels. That’s less than 6 percent taking a shot at turning things around! With startups often tangled in complex ownership webs and capital harder to come by than ever, these processes offer a lifeline — a chance to restructure debts, attract new investment, and emerge stronger. But the clock’s ticking, and every delay narrows the window to save what could still be a thriving business. It’s high time entrepreneurs and investors alike got savvy about these tools before it’s too late. Ready to dive deeper into the under-explored world of Scarp and examinership? LEARN MORE

Many viable Irish firms are going to the wall without trying the rescue processes available. BDO’s Ian Barrett looks at the under-utilised roles of Scarp and examinership

Dozens of companies are potentially going to the wall without trying business-saving rescue processes.

Last year, only 43 attempts of corporate rescue processes were made out of 812 insolvencies.

Both examinership and small business rescues remain under-utilised processes when investment is required to save financially distressed but viable companies.

These processes must be explored as they provide viable startups with an opportunity to restructure debts and ensure their survival.

There is still an extremely low uptake of the Small Company Administrative Rescue Process (Scarp) and examinership, with both processes used only 43 times in 2025, which is around 5.3 per cent of all corporate insolvencies.

In 2024 the total number of Scarps and examinerships was even lower at 41, just under 4.7 per cent of all corporate insolvencies.

Around 20 per cent of new businesses in Ireland fail within their first year.

Many startups complete numerous funding rounds, resulting in fragmented ownership structures. This can be unattractive to potential new investors, especially for financially distressed companies.

A recent Scale Ireland survey showed that funding remains by far the biggest concern for startup founders and CEOs, with more than 80 per cent of respondents saying it is “difficult” or “very difficult” to attract capital.

In recent years various economic headwinds have caused some startups to not grow as planned, resulting in financial difficulties which threaten their survival.

There will be some startups dealing with current or new potential investors who do not have the appetite to provide further capital or debt to a startup which is facing insolvency.

In these situations, examinership or Scarp can provide a solution.

These are formal corporate rescue processes where an examiner or process advisor is appointed to formulate a rescue plan and ensure the continued survival of insolvent companies.

An investor, through examinership or Scarp, can acquire all or most of the share capital of the company.

The investor(s) provide the capital needed to restructure the company’s debts and operations, thereby creating a more sustainable business.

By investing through either of these processes, investors can benefit from the company’s preserved value while protecting jobs.

In essence, investors have a chance to acquire a potentially strong business at a significant discount.

Both examinership and Scarp are known as positive actions taken by a company to ensure its survival and avoid liquidation.

They are used frequently by investors to acquire financially distressed companies where the underlying business is viable, but has not fulfil edits potential.

Both processes are also attractive to investors as the company will have a clean restructured balance sheet, with debt and other legacy issues addressed through the rescue plan or scheme.

The company will be in a much healthier financial position and the rewards can be substantial for an investor who has acquired a potentially valuable business at a discounted value.

The burden of loss-making onerous contracts such as leases can also be removed through either process, allowing the business to potentially thrive.

Investment in a company through these processes may be challenging, given the limited due diligence that can be undertaken within a tight timeframe.

This makes advanced planning before commencing either process more important, meaning a successful outcome is more likely.

Early action and specialist advice are important to explore what options are suitable to ensure the future survival of the company and avoid liquidation.

As time goes on, the chances of exploring restructuring options diminish, leaving less time for planning in advance of starting an examinership and Scarp.

For too many otherwise viable companies, that delay proves fatal.