The question isn't exactly asking what the passage is saying about the first instance of the laws. Rather, it is asking what the author intended to convey by using the phrase in question. When we say that bankruptcy is better for creditors than one would expect, this implies that there is something counterintuitive about bankruptcy laws being good for creditors. That is, these laws are more favorable to creditors that one would expect on a first glance, which is what D says.
C is wrong because the effect can be positive for a group without that group having been involved in formulating the policy.
