Many hardware products are built with licensed code. It cannot be released because the company doesn’t own all of it.

There’s also more to a product than just some source code. You’d need the cloud domains, the private keys and certificates, and other bits. Releasing many of these to the public domain wouldn’t solve anything because you’d need someone to operate the cloud servers at the known address and trust with the private keys and certificates

All of this quickly begins to look a lot like requiring someone to operate the business again, which is obviously a silly thing to require in bankruptcy proceedings.

Forcing companies to release their IP if they go bankrupt is equally silly, because it renders the value of the company’s IP as $0 before anyone can be paid out.

The only thing this would incentivize is for companies to either relocate to countries with sane laws, or to shut off the servers and avoid bankruptcies by keeping the company technically alive but doing nothing other than staying as a registered business. It would act as a holding company to keep the IP in case someone wanted to buy it.