Small Business Reorganization Act (SBRA)

The Small Business Reorganization Act (SBRA), enacted in 2019, provides a streamlined bankruptcy process specifically for small businesses facing financial difficulties. It introduces a new chapter (11) pathway—Chapter 11 Subchapter V—that simplifies and accelerates reorganization, reducing costs and procedural complexities. This helps small businesses restructure debts more efficiently while maintaining control of their operations, increasing their chances of recovery and future stability. Essentially, SBRA offers a tailored, less burdensome legal route for small enterprises to reorganize instead of shutting down amid financial distress.