H.R. 5939House117th Congress (2021-2023)In Committee

Small Business Reorganization Technical Corrections Act

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Updated February 8, 2026 at 7:59 AM UTC

The Small Business Reorganization Technical Corrections Act updates the bankruptcy code to clarify several provisions of the Small Business Reorganization Act. It revises definitions of who qualifies as a small‑business debtor and a debtor, clarifies a trustee’s authority to run a debtor’s business, and adjusts the criteria for confirming a reorganization plan. The changes affect small‑business debtors, trustees, and bankruptcy courts handling these cases.

Key Provisions

Changes the definition of “small business debtor” to refer to a corporation described in clause (ii) rather than “an issuer.”
Updates the definition of “debtor” in §1182(1)(B) by adding “under this title” after “affiliated debtors” and replacing “an issuer” with “a corporation described in clause (ii).
Revises trustee authority in §1183(b)(5) to explicitly allow trustees to operate the debtor’s business and clarifies related language.
Amends plan confirmation rules in §1191(c) so a plan can be confirmed if the debtor can make all payments, or if there is a reasonable likelihood of payment with appropriate remedies such as liquidation of nonexempt assets.

Legislative Activity

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2 earlier actions

HouseCommittee Latest Action

Referred to the Subcommittee on Antitrust, Commercial, and Administrative Law.

Administrative State, Regulatory Reform, and Antitrust Subcommittee

November 1, 2022

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HouseIntro Referral

Introduced in House

November 9, 2021

HouseIntro Referral

Referred to the House Committee on the Judiciary.

Judiciary Committee

November 9, 2021

HouseCommittee

Referred to the Subcommittee on Antitrust, Commercial, and Administrative Law.

Administrative State, Regulatory Reform, and Antitrust Subcommittee

November 1, 2022

Bill Text

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Introduced in HouseIssued November 9, 2021

117th CONGRESS

1st Session

H. R. 5939

IN THE HOUSE OF REPRESENTATIVES

November 9, 2021

Mr. Neguse introduced the following bill; which was referred to the Committee on the Judiciary

A BILL

To amend title 11, United States Code, to make clarifications with respect to amendments made by the Small Business Reorganization Act, and for other purposes.

Short title

This Act may be cited as the Small Business Reorganization Technical Corrections Act.

Title 11 amendments

(a)

Definition of small business debtor

Section 101(51D)(B)(iii) of title 11, United States Code, is amended by striking an issuer and all that follows and inserting a corporation described in clause (ii)..

(b)

Definition of debtor

Section 1182(1)(B) of title 11, United States Code, is amended—

(1)

in clause (i), by inserting under this title after affiliated debtors; and

(2)

in clause (iii), by striking an issuer and all that follows and inserting a corporation described in clause (ii)..

(c)

Trustee

Section 1183(b)(5) of title 11, United States Code, is amended—

(1)

by striking possession, perform and inserting “possession—

(A)

perform

;

(2)

in subparagraph (A), as so designated—

(A)

by striking , including operating the business of the debtor; and

(B)

by adding and at the end; and

(3)

by adding at the end the following:

(B)

be authorized to operate the business of the debtor;

(d)

Confirmation of plan

Section 1191(c) of title 11, United States Code, is amended by striking paragraph (3) and inserting the following:

(3)

(A)

The debtor will be able to make all payments under the plan; or

(B)

(i)

there is a reasonable likelihood that the debtor will be able to make all payments under the plan; and

(ii)

the plan provides appropriate remedies, which may include the liquidation of nonexempt assets, to protect the holders of claims or interests in the event that the payments are not made.